Back in September, we wrote about everything you need to know about Ad bidding on Facebook. It’s many months later, and we are starting to see the implications of the increasing technical savviness of advertisers on Facebook, as well as the effects of the sheer number of advertisers on the platform. They are clearly having an effect on ad bidding and delivery. So, what does one do to be successful in this environment?
First, let’s try to understand the “problem”. It’s clear that advertising on Facebook has moved beyond being something that only more experienced digital marketing professionals do.
The user-friendliness of the Facebook Ads platform as well as EdgeRank changes have increased advertisers. With the increase in advertisers comes competition – and with competition comes a necessity for higher bids. Just like when EdgeRank changes lowered organic reach – it is getting a lot more expensive to get paid reach. If you are budget-conscious (you all should be) it’s in your interest to keep bidding as low as possible but find ways to increase ad delivery. Ad quality has also increased overall, and this is a good indication of how sophisticated ads are getting. Facebook even launched a special metric to tell advertisers how good their ads are – Relevance Score.
So Should You Do?
Now, let’s look at the “solution”. If you are not making your daily budget, you probably need to bid higher. Makes sense, right? Facebook uses maximum bids meaning that whatever your CPC limit is, you’re not going to pay more.
Higher bids will reach higher quality audiences that are more likely to convert. If you are after great ROI, you should be prepared to pay for it. Remember that Facebook doesn’t want to swamp people with irrelevant ads. It will serve the best to the best in order to maximise your ROI.
To do this though, Facebook needs massive audiences to serve lots of impressions to. This is where “optimised CPM” (oCPM for short) comes into play. We talked briefly about oCPM before. Facebook will optimise your CPM according to your ad objective. The platform’s algorithm knows who is more likely to convert – whatever your objective – and will serve ads as relevantly as possible.
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Again, in order for it to work, you need hight ad delivery rates and good conversion rates. Higher bids will generally help you get the delivery, whereas to increase conversions you might have to look at what your conversion action actually is, and whether it’s “too much to ask” of people. Obviously, you will be bidding a lot higher if you are making money from conversions. But there is a big chasm between buying something expensive, and receiving something for free after signing up to a newsletter – and a lot in-between.
Finally, make sure you renew your ad materials as often as necessary if you notice that your ad frequency is high and you’re not getting the Conversion Rate (CVR for short) that you deserve.
- Facebook Will Now Track Online And Offline Sales Driven By Ads
- The 2014 Social Media Ads Cheat Sheet
- With Web Tracking, Facebook Will Offer More Relevant Ads To Users