Facebook’s ad system is one of the most powerful pay-per-click (PPC) platforms. It can give you incredible reach, helping even small businesses with tight budgets increase brand awareness, lead generation, and potential sales.
But how much do Facebook ads cost? Does the ad system work for every type of business? And how do you know if Facebook ads are actually worth it for you?
In this post, we’ll go over everything you need to get started (and find success!) with Facebook ads, whether you’ve used the Meta Ads Manager platform before or not. Here's what we'll cover:
- What are Facebook ads?
- The difference between Facebook ads and post sponsoring
- Why Facebook ads work
- How much Facebook ads cost
- Types of Facebook ads (formats vs placements)
- How to create Facebook ads in three steps
- Best practices for targeting, creative, budget, and measurement
What are Facebook ads?
Facebook Ads — sometimes called Meta Ads — is the ad system Meta uses to place ads throughout the Facebook desktop and mobile app. As users are scrolling through their feeds, watching videos, or even checking out their friends’ stories, they may see paid ads from brands and businesses they don’t follow.
Facebook ads look something like this:
Any Page can run Facebook ads through their Meta business account, and you can run Facebook and Instagram accounts at the same time.
What’s the difference between Facebook ads and Facebook post sponsoring?
Facebook ads and Facebook post sponsoring are both paid promotions that you can run through Meta, but they work a bit differently.
Facebook Ads allow you to generate new creative copy, images, and visuals in a variety of formats, and run them as part of targeted campaigns across Facebook. You can get exceptionally detailed control over bidding strategies, optimization, and audience targeting.
Facebook sponsored posts allow you boost an existing organic post that has already been published on your page. You can pay to promote this, and you can still set your budget, schedule, and audience targeting.
If your goal is to boost reach and visibility on a high-value organic post, sponsored posts can be an invaluable asset. However, if you want to develop full-fledged campaigns with expanded targeting abilities and better chances of clicks to your site, ads are the way to go.
Loomly makes it easy to create and manage sponsored posts through our streamlined dashboard
Do Facebook ads actually work?
Having worked with small businesses and startups on Facebook ads for nearly a decade, this is a concern I hear a lot: Will they actually work for me?
While there’s no guarantee for positive return on investment (ROI) with any marketing campaign, there are many small businesses who have successfully run and profited from Facebook ads even when they have limited experience and budget.
Keep in mind that Facebook currently has around 2.9 billion monthly active users, and their ad system helps you reach them. A good or average click-through rate (CTR) is around 2.5% on Facebook, which means that 2.5% of all users who see your ad will click. While 2.5% of users seems tiny, if you’re showing your ad to thousands of users a month at a relatively low cost, this can deliver meaningful results over time.
Also worth noting is that you’re paying for guaranteed visibility and, depending on what you’re bidding on, specific outcomes. Facebook only charges you when users take the desired action that you've outlined for your ad. This may include receiving around 1,000 views, video views, clicks to your site, or a conversion sale action.
While clicks to your site don't guarantee a purchase, it is a good start — especially since Facebook does uses machine learning to show your ads to relevant users who are most likely to take your chosen conversion action. When you first launch your campaign, Facebook will test how your ads perform with different audience segments across different placements. This helps them find which users are most likely to take the action you want, such as clicking on an ad, or watching a video. They’ll then optimize ad delivery to similar users to improve your visibility amongst the right audience.
How much do Facebook ads cost?
There are multiple factors that impact the cost of Facebook Ads. You’ll notice that even in a single campaign, your cost per action (CPA) and cost per click (CPC) will change from day to day.
This is because Facebook works on a bidding system. If there are other advertisers trying to reach the same audience, you end up bidding against each other. The ad that Facebook deems most relevant and that has a more competitive bid will score the placement. Keep in mind that more relevant scores have a direct correlation with more placements and lower ad pricing.
All this said, here are a few solid benchmarks that can give you a very baseline idea of what to expect with Facebook ad cost:
- Facebook ads cost approximately 63¢ per click.
- Facebook ads cost approximately $9.78 per 1,000 impressions.
There are two more things to consider when it comes to cost. You can set your total or daily ad budget, which limits how much you’ll spend in total. You can also choose to set limits or target values that tell Facebook how much you’re willing to spend for certain types of actions. Fore example, you could set limits to spend only $.30 per click and a total of $25 per day. In other words, your ad spend doesn't have to be a surprise at the end of the month — you can set limits to keep Facebook ad costs within your budget.
Types of Facebook ads
When people want to know about different types of Facebook ads, they’re typically referring to one of two things: Facebook ad formats, which determine how the ad shows up, or Facebook ad placements, which determine where the ad show up.
Let’s look at each.
Facebook ad formats
Facebook offers a plethora of creative ad types, but there are four core ad formats you should know about:
- Story ads
- Photo ads
- Videos ads
- Carousel ads
1. Story ads
Stories are used by more than one billion people every day across Facebook, Instagram, and WhatsApp. Users spend between 24 and 32 minutes watching Story-based content each day.
Statistics also show that:
- 31% of users have visited a store to buy a product after seeing it in a Story.
- Users visit websites shown in stories at a rate of 15% to 25%
This means there are a lot of engaged eyeballs there, making them an excellent place to share your ads.
2. Photo ads
Photo ads are quick, easy, and effective. By creating intriguing creative assets, you can drive high levels of clicks and traffic.
At a high level, there are three key things to remember when creating Facebook photo ads:
- Your designs need to adhere to Facebook’s guidelines
- High-quality creative can make or break your campaign
- Your images need to stand out in a busy newsfeed
3. Video ads
Video ads can be an advertiser’s secret weapon. Research shows users spend up to five times longer looking at video content on Facebook and Instagram than they do static content.
4. Carousel ads
Facebook’s carousel ads are a fantastic storytelling tool. They are best used when your ad has a focus on:
- Multiple products
- Long-form copywriting
Because these components would be restricted by both photo and video ads. Here is how a carousel ad looks in action:
Much like Photo ads, you need to create contrast and use high-quality digital assets to grab your audience’s attention. You can use multiple captions to tell a follow-along story.
We find this four-slide strategy to be effective:
- Hook: a stand-out slide to capture user attention
- Info: a slide that talks about one specific benefit or feature
- Info: a slide that talks about a second benefit or feature
- CTA: a strong call-to-action to interact with your ad
Facebook ad placements
There are multiple different ad placements, which determine where your ad will appear on Facebook or Instagram. On-platform placements include the following:
- Facebook and Instagram feeds: Your ad will appear in between organic posts, often in photo, video, or carousel format. They often have great visibility and solid CTR rates.
- Right column ads: These ads appear on the right hand side of the Facebook desktop app. They have lower CTR rates, but they also cost less than most other placements, so they can keep your average CTA low.
- Video ads: These ads may play before or during a video that users are already watching on Facebook.
- Story ads: These are technically an ad format and a placement, showing up between organic Stories that you’re already watching.
- Instagram Explore: Ads may appear in a users’ personal Explore page when you click on a photo or video.
- Facebook Marketplace: These ads appear on the Marketplace homepage, or when you’re browsing the Marketplace feed. Your ads may also appear in search next to Marketplace results.
- Messenger sponsored messages: You can send paid promotional messages to users who have already messaged you in recent history.
In most cases, it’s best to leave all platforms enabled when creating ads — this is the default setting. It allows Facebook to find the right balance of high engaging and cost-effective placements to drive results at your target cost per action (CPA).
How to create Facebook ads
Running Facebook Ads comes down to three key steps: Setting up your Meta Pixel (it's easier than it sounds), creating your campaigns, and tracking progress and optimizing campaigns.
Let’s go through the process.
Step 1: Set up tracking
Your Meta Pixel is a snippet of code you place on your website that lets your website and Facebook communicate with each other. When users click on your Facebook ad, that code fires on your website and it tells Facebook which users clicked. This can help you track conversion data, which can in turn help Facebook send more relevant users your way. You can also set up the tracking pixel to record events that are meaningful for your business; for example, a retail business might record when users add something to their cart.
The Meta tracking pixel can also track users who visited your website for retargeting repurposes. You can target users who visited certain product pages via specific ads, for example.
You can also set up Facebook Conversions API, which pulls data from your own first-party tracking and doesn’t rely on Facebook’s Meta Pixel.
Here are guidelines for how to install both features:
Step 2: Create your ad
Creating an ad on Facebook has never been easier, as the self-service campaign creator really walks you through every step.
First, you’ll choose an objective. This tells Facebook what you want this specific campaign (and all of the ads within the campaign) to do.
Think about the immediate action or result you want to drive — that may be awareness, traffic, or sales. Facebook will show your ad to users most likely to take the chosen action. For this example, we’ll create an Awareness campaign.
The next step is to create your Ad Set. This is the backstage stuff that plays a crucial role in the success of your Facebook ad:
- Budget and schedule: how much you will spend over time
- Audience: the users your ad will target
- Placement: where your ad will display
Before you play with these controls, you can choose to run A/B tests on your campaign. This is often a good idea, especially when you’re getting new campaigns up and running.
You’ll be asked to name your campaign. I strongly recommend choosing something descriptive that will be easy to organize as you scale your campaigns, like “Black Friday Campaign_Bundle Sale.”
Now it's time to set a daily or lifetime campaign budget. You can also choose to enable an Advantage campaign budget, which distributes budget across ad sets based on potential results.
Daily budget refers to the average amount of money you want to spend, per day, for the duration of your campaign. Let’s say you want to run an ad for seven days with a daily budget of $10. Facebook will take the $70 allocated for this ad set and spread it evenly over the next seven days.
Lifetime budgets work with a similar process. You first select the duration of your campaign — this can be any number of days, weeks, months, or years. Then select the budget you want to spend over that time period. For example, you want to run an ad for one month with a budget of $500.
Facebook will use that $500 and spend an amount of it each day. The amount will change based on the quality of opportunities available, such as high or low traffic days. You could spend $50 in one day and $20 the next, but you will never spend more than your budget.
You can also set a start date and, if you want, an end date.
Once you’ve defined your budget and schedule, you’ll choose your audience controls.
For audience targeting, you have multiple options, including the following:
- Location
- Demographics like age and gender
- Custom audiences, including retargeting based on site activity, on-platform activity, or lists
- Interest-based targeting
- Lookalike audiences, which target users similar to established custom audience members and are great for reaching high-value cold audiences
You can choose to include or exclude certain audiences. If, for example, you want to exclude brand-aware audiences from seeing an ad meant for new customers, you can do so.
As you adjust your audience controls, keep an eye on the Audience definition. This tells you your estimated audience size, and how broad or targeted it is.
When choosing placements, you can use Advantage+ placements, which is the default setting. Meta will automatically use as many placements as possible. If you choose, however, you can select only manual placements.
You can also choose to customize your bid. Many users will skip this, leaving it up to Meta, but you can choose from different bidding strategies.
Finally, it's time to create the ad itself. You’ll be asked to choose ad formats, and enter in the relevant copy, images, and/or videos. You’ll also select a CTA button and add the URL you want to send users to. Keep reading for tips on developing your ad creative.
Once you do this, preview the ad campaign, double check for typos, and submit it for approval!
Step 3: Track ad progress and KPIs
Once your ads have started running, it’s important to track their progress often.
You can access your ad analytics through your Ads Managers. The default dashboard shows common KPIs like cost per click (CPC), total campaign cost, number of clicks, impressions, and metrics like frequency (which tell you how often users have seen a single ad). You can learn more about Facebook Ad metrics here.
Facebook ads best practices
Looking for inspiration to help make your ad campaign a success? Let’s look at a few more best practices to get the most out of your campaigns.
To give you some inspiration, we’ll be using examples from the Facebook ads library, which is a great resource to tap when you're writing and designing ads. You can look for ads within your industry and if you're lucky even examine your direct competitors' ads!
Audience targeting tips
Audience targeting is complex, so testing is an important part of the process. That said, here are a few tips to keep in mind:
- You want your audience to be narrow enough to be relevant to people seeing the ad, but not so narrow that the campaign becomes cost prohibitive or you risk alienating potential audience members.
- You can (and should!) test layering different audience controls, such as adding age, location, and interest targeting.
- Create specific campaigns for specific audience segments, and consider how to best reach each og them.
- Keep an eye on current privacy policies — Apple’s iOS 14.5 directly impacted pixel use, which impacted retargeting for some users; stay up to date on these changes and best practices to maintain good targeting practices, like using the Conversions API.
Facebook ads creative tips
Sometimes you spend so much time fiddling with audience controls that you forget what your audience is really seeing: your ad creative. Here are some best practices to keep in mind.
Have a unique hook
Start your ad copy strong with a great hook. Put a key benefit or pain point right at the beginning of your copy to draw users in and make them feel seen.
Follow the 20% rule
Facebook has long had their infamous 20% rule, which required that an image shouldn’t be made up of more than 20% text. While that rule is long gone, it’s still considered a general best practice for engagement purposes.
Add social proof
Research shows that ads containing social proof have 300% more conversions and spend less to achieve their marketing objectives.
Social proof is basically a third-party endorsement of your product or service, like a testimonial or a statistic that showcases results you can deliver.
Maintain brand consistency
Brand consistency is a proven way to build trust and recognition with your audience. It's also one of the most crucial factors for consumers when choosing which brands to buy from.
For Facebook ads, this means that the branded elements your users see in your ad should reflect what they see on the page they click through to. These elements include:
- Logos
- Typography
- Color schemes
- Messaging
They do not need to be a one-for-one match. But your site should look and feel like what users have experienced on Facebook.
Ensure your landing page matches the ad
It’s critical to ensure that each ad matches the landing page it sends users to once they click. This sounds easy, but it can get confusing if you've built multiple landing pages for different audience segments or offers.
If users click on your ad, the landing page they arrive on should make sense. Make sure these elements are aligned:
- Products of services featured
- Pricing
- Offer
- Key features or benefits advertised
Spending and duration tips
When considering spending and ad duration, these are the best practices to keep in mind:
- Schedule accurate start and end dates for seasonal or short-term ad campaigns.
- Determine your max total ad spend, and divide that up between your different campaigns.
- Set automated rules to help monitor and track ad spend, preventing you from accidentally overspending.
- Sticking to default bidding options is a good idea at first, but once you're more comfortable, try manual bids to see how they can impact your overall ROI.
Measure and optimize tips
When it comes to measuring, assessing, and optimizing your campaigns, keep these tips in mind:
- Keep a close eye on costs and performance regularly, because things can change quickly.
- Don’t automatically discount higher-cost campaigns; sometimes campaigns with higher cost per click (CPC) or cost per action (CPA) also drive higher quality clicks or leads, which can net higher ROI.
- In my experience, it takes around two weeks to four months for Facebook to really "learn" your business and your audience, so give Meta some time for self-optimization.
- Watch your frequency; if it gets too high (above a 3 or a 4), it may be time to switch up your campaigns to prevent users from experiencing ad fatigue.
Test Consistently
Regular A/B testing is at the backbone of Facebook advertising. A/B testing Facebook ads is when you run two versions of the ad with minor differences in creative or targeting. The winning ad helps you determine ad elements that you can apply to your entire campaign or across the board.
It can be useful to start with a smaller budget and test the following criteria, but make sure you only test one factor at a time to understand what impacts ad performance:
- Targeting options
- Images
- Videos
- Formatting
- Copywriting
- Calls to action
Most experts recommend allocating a certain percentage of your budget to tests. The most common number I’ve seen from multiple agencies is about 10% of the budget once you’ve got some solid campaigns established.
Final thoughts
While Facebook ads require upfront investment, it’s a pay-to-play platform with an extremely user-friendly self-service platform. Even small businesses without technical ad experience can run campaigns on a tight budget.
Make sure that you account for a ramping up period, giving new campaigns an average of two weeks to a month so Facebook’s machine learning can figure out who to show your ad to and when. After that, you can start making adjustments, run more tests, and switch up your strategies.
Want to dip your toes into Facebook ads with a few quick boosted posts? Get started with Loomly’s post sponsoring here!
