Facebook campaign budget optimization how marketers must prepare for September 1, 2019

Budget optimization for Facebook campaigns: how marketers should prepare for September 1, 2019

If you use Facebook's Ads Manager, campaign budget optimization (CBO) becomes mandatory for all advertising campaigns from September 1, 2019.

If you use an API tool such as AdRules, you have until September 2020 before it is mandatory.

If you advertise on Facebook, this change will affect you. It applies to both new and existing advertising campaigns.

If you don't want rude awakening on September 1 when CBO is activated in Ads Manager and your Facebook campaigns start to behave very differently, you should now start testing the campaign budget optimization.

Example of campaign budget optimization for Facebook AdsManager

Although no one likes mandatory, sudden changes, this is not all ruin and gloom. There are a number of important benefits to CBO. After 1 September you must give up some control over your campaigns, but with CBO:

1. You will have less to manage

If you spend hours every week adjusting bids or if you pay someone else every week to adjust bids, much of that bid optimization work is over.

When campaign budget optimization is activated in Ad Manager, Facebook automatically shifts the advertising budget to the most effective ad. You determine the definition of what & # 39; effective & # 39; means by specifying a goal for each campaign. Goals that are fairly late in your sales funnel, such as a purchase or a download, usually work best with CBO.

Because all that bidding work is done by the Facebook algorithm, you may be able to hire less expensive people to manage your campaigns or have your team members work on more networks or accounts. Or if you have carried out those bidding operations yourself, you may find that you suddenly have extra hours off every week. We recommend using those free hours to develop better ads, to study your competitors' ads, or to set up a more efficient creative test machine.

2. You get a better return on advertising spend (ROAS)

Although there were some early reports that CBO did not work as well as human-managed campaigns, the algorithm has become considerably smarter than when it was first launched.

We have found that if a campaign is set up correctly and the bids are high enough, CBO can generally achieve better results than a person.

CBO also reduces how often your campaigns are put into "learning mode". This means that you will not be penalized if the Facebook algorithm reassesses your campaigns.

But you must give campaign budget optimization time to work. The algorithm needs about 50 conversions per ad set per week before it collects enough data to speed up your campaigns. And speaking of stepping up campaigns if you want to scale up your campaigns, CBO is extremely effective. Especially if you continue to feed the new, high-quality audience.

3. You can still manage spending (to a certain extent) with advertising spending limits

If you set a minimum spending for an ad set, Facebook will dutifully spend at least that amount. And if you set a maximum spending limit for ads, Facebook will not exceed that limit.

This is a way of sorting a & # 39; governor & # 39; to adjust to your expenses. It may force Facebook to run ad sets longer than would otherwise be the case, but if you are not yet ready to give up control, advertising spending limits are a way to facilitate this new campaign management approach.

Those of you who also advertise with Google's app campaigns may already have a head start. Facebook follows the leadership of Google in some ways by requiring advertisers to switch to automated budget optimization.

You could potentially bypass CBO by creating dozens or even hundreds of campaigns, each with one ad set. But that would work against the algorithm. And by the way, CBO works well. There are not many good reasons to try to bypass it. Especially when you use it in combination with other Facebook best practices and Facebook's simplified campaign structure recommendation.

Start testing campaign budget optimization now

The benefits of CBO have been proven, but you must now start testing to see how it works well for your accounts. We have a few months left until the change in Ads Manager, but you may need to run several weeks of tests to master this new budgeting strategy.

You may also need to change how you have defined goals. The use of CBO for clicks is a waste of potential. Look instead at the end of the buyers' journey. We optimize not only for app installations, but also for specific app events such as purchases. And not just for two-dollar purchases, we focus on people who are likely to spend $ 20 or more.

When you start testing and measuring CBO, don't get too attached to the results of individual ad sets. Look at the campaign level, as this image illustrates:

Comparative study of having versus not having campaign budget optimization

Also prepare to increase your advertisements. For CBO to work, it often needs different creative resources for each ad set. Adding some video & # 39; s and elements for dynamic ads also helps.

Also pay attention to your audience. Many advertisers have discovered that CBO works best for them if they create separate campaigns for different audiences, such as a campaign for a cold audience and another campaign for a & # 39; warm & # 39; audience, such as a retargeting audience.

Prepare for things like "The Breakdown Effect" to make your report look a little strange at first. & # 39; The breakdown effect & # 39; occurs when discount stimulation (how often your ads are shown) crosses with discount bids and it seems like the system is charging you too much for conversions. What actually happens is that the system first tries to find the most affordable conversions, and then it tries to find more expensive conversions.

Graph shown

If you perform many tests, this analysis pattern is probably known. It is similar to how one cell of a test may initially look like a winner, but as the data increases, that early winner falls away and it is demonstrated that another cell performs better in the long term.

Final thoughts

Facebook is evolving. Everyone knows this, but the CBO change for Ads Manager in September is another example of how it happens again. And because the Facebook advertising platform is evolving, advertisers must also evolve with it. If you still advertise on Facebook like a year ago, you lose money and miss a better ROAS.

Brian Bowman is the CEO of ConsumerAcquisition.com.

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