“92% of social marketers use Facebook for advertising.”
Ads are no doubt an important part of social media marketing, especially Facebook ads. With an average of 1.9 billion daily active users on the platform and the presence of all levels of buyers and sellers, digital marketers can reach out to any target audience here.
However, if your Facebook ads are not intentionally optimized to have a low CPC, you can exceed your budget before realizing it. No matter the size of your business, ad optimization is a must to reduce costs and improve your ROI.
Here are 5 simple ways to lower your Facebook ad costs –
1. Analyze the relevance score
A relevance score is provided by every campaign that is run on Facebook. This score reveals the relevancy of the ad to the target audience and directly affects your CPC, so it is important to understand and analyse it.
While the exact algorithm used to calculate the relevancy score is not known, positive interactions such as clicks, engagement and saves improve your score while actions like hiding the ad have a negative impact on the score.
Facebook gives priority to ads with a high relevance score, which would eventually lower the CPC – significantly. Keep a track of the score on all your ad campaigns and make adjustments or pause ads that continue getting lower scores.
2. Concentrate on a higher CTR
A higher CTR would automatically lead to a higher relevancy score, which would lead to a lower your ads cost.
A few tips to increase the CTR of your Facebook ads are –
- Desktop newsfeed ad placements always tend to have a higher CTR.
- The CTA button in your ad should be highly relevant and encourage the user to click on it. In some cases, a Learn More CTA button can bring more results than a Buy Now button if there are target audiences who have not been able to trust your brand completely.
- A simple and brief copy is a must so that the audience knows for sure why they are clicking on the CTA and what to expect later.
- The frequency of your ad, meaning the total number of times the same audience sees the same ad should be kept as low as it can be. A higher frequency would lead to a decrease in the CTR.
3. Ensure campaigns are highly targeted
Running highly targeted campaigns can be considered to be the most effective way to increase your CTR. The advantage of targeted campaigns is having a niche audience that have particular wants and your Facebook ads can be crafted accordingly to meet their demands. For example, if you are running ads for a pet food brand, the target audience would comprise only pet parents.
There are different types of targeting options like age, location, gender, interests, behaviour, etc. In the user behaviour option, you can further personalize the targeting – for example, a user’s birthday in the next 3 months or a user who has recently purchased electronic goods.
In this context, retargeting is also a good option to increase CTR and lower your CPC. Showing ads to the audience who are already familiar with your brand increases the chances of them clicking and interacting with your ad.
4. Conduct A/B testing of ads
As a thumb rule, you should always do A/B testing of all Facebook ads if you want to keep the cost low – even if what you’re offering seems one-of-a-kind or hard to resist. Create two or more versions of the same ad campaign using different copy, visuals and video. Even the headline and the ad description should be different.
Split testing ads helps gain an insight into the preference of your target audience, thus providing proven and logical results instead of experiments and gut feelings. It will also help your brand run ad campaigns with higher CTRs and pause the lesser performing ones. The result would be less frequency, less spending and more engagement.
5. Ad placements
According to a study by Hootsuite, “The placement of the ads can change the click-through rates (CTRs) by as much as 400% or more, and can more than double the cost of running your ads.”
It is important to select the ad placements depending on the purpose of your ad campaign. For example, mobile ads are more effective when the objective is to download an app or make a purchase.
Here are the four most important ad placement options on Facebook the purpose it can serve –
- Newsfeed ads – It generally has a high CTR and low CPC, and it works better for audiences who are not yet familiar with your brand or products.
- Right column ads – These ads have a lower conversion rate, but have almost 3x more engagement than newsfeed ads and are quite cost-effective to reach a larger audience.
- Mobile feeds – They have a high CTR and are effective to create awareness and encourage more conversations.
- Marketplace ads – Placing ads on the marketplace is affordable compared to Google, and are effective in targeting audiences who are actually looking for something.
The equation is simple, the better your ad performance, the lower its cost. Though there are numerous factors that affect the cost of your Facebook ads, with strategic adjustments, you can achieve more results at a lower cost. To know more about the best ways to lower your Facebook ad costs and its implementation, leave us a message and we’ll get back to you!