This question fills my Instagram DMs on a weekly basis.
Having worked in the Facebook ad game now for over a decade, I’m fortunate to work on high-level campaigns with 4-5 figure monthly budgets. But you can achieve results with a lot less, if you know how.
As an online business owner new to Facebook advertising, you want to know how much it’s going to cost you and what you will get in return. It’s a fair question. But unfortunately, there’s no magic number or ‘golden rule’.
If your business has a clear marketing budget, this can be a great starting point. You can allocate a percentage to Facebook ads and begin to calculate your targets.
If you simply have no idea how much to spend, then you’ll need to consider these 3 things:
- Your goal
- Your targets (and timeframe)
- Your conversion rate
Let’s break those 3 categories down a bit further…
Start with the end in mind
To decide how much to spend, you need to know what you want to achieve ie, what ad objective you are looking to run. Using Facebook ads to increase your page engagement is a very different objective to driving email sign ups, or sales. The time and budget required to achieve success varies greatly.
Many businesses who are new to advertising make the assumption that because they are running ads, they will see incredible results right away. This is rarely the case. On average, a consumer will visit your website up to 15 times before deciding to take action. So, consider what you are asking of your audience, and how much time you may need to invest in getting them to know, like and trust you before they convert.
Set specific targets
With a clear goal to work towards, you also need to set specific targets. For example, generating 100 new email subscribers each month.
Setting targets not only helps you to measure whether your campaign was a success or not, but it also helps to inform your budget. In some instances, targets will be set for you – by your boss or team. If not, there are several tools you can use to help you:
- Previous Facebook ad campaign data (if you have any)
- Your conversion rates (website traffic, leads, sales etc)
- Industry averages – if you’re a new business with little data available, look at the average cost per result for your industry (and target country) as a starting point
Knowing your numbers helps too.
- How many visits your website gets per month
- Your average cost per click
- Your conversion rates
- Your cost per lead
- Your monthly sales
You can then easily work out your targets based on your averages. Remember, estimated targets are fine too. You can always update them as you collect more data in your campaign.
No matter how much experience you may or may not have with Facebook advertising, the same advice applies when it comes to budgeting – start small.
It can take months before your campaign really starts to generate great results and you see a return on your investment. A huge factor within this is the need to test. Test your audiences, your adverts, your messages, your offer. You will not find your dream audience or create the perfect advert straight away. In fact, I advise businesses to allow for at least 3 months before a new campaign starts to work well.
With this in mind, it’s important to start small with your budgets. Once you have more data available and can see what’s working, you can scale up as needed.
The worst thing you can do as a novice advertiser is throw a tonne of money at a new campaign. Facebook will quickly spend it, leaving you with little to show for your efforts.
Minimum monthly spend
If you’re still unsure how much to spend on Facebook ads but want to start small, I recommend £300 per month (£10 per day) as a minimum.
This allows you to run A/B tests, to experiment with ads, and to gather enough data to learn from. Anything less than this will yield fairly low numbers which won’t give you much insight to learn from.
Remember, you want to generate and gather as much data as possible. The more data you have, the more informed your decision-making process will be the next time you come to plan your ad campaign.
If you’re keen to grow your audience and impact through Facebook and Instagram ads, download my free Audience Growth Guide for the 7 strategies I recommend to my clients!
I help digital coaches & entrepreneurs to grow their audience and make more sales online, through the magic of funnels and ads!