How to Reduce Wasteful Facebook Advertising Spend
Campaign Optimization Best Practices
There are a number of best practices to consider when optimizing Facebook ad campaigns. Follow these tips to ensure you are making the most of your Facebook advertising spend.
A|B Test MAI vs. AEO vs. VO
MAI is ideal for brand new accounts in order to build upconversion history. After MAI, you should transition to App Event (AEO) and Value (VO) bidding. For new accounts, VO will not initially be available until you have enough AEO optimization data.
AEO needs slightly higher quality audiences than VO, while VO needs broad audiences. VO is a more finite audience than AEO and will reach audience saturation more quickly. VO should be more efficient for new audiences and new creative, and AEO may be more efficient for you as the VO audience pool becomes oversaturated. As a bit of context, on average, we’ve seen AEO is 2-3X the cost of a mobile app install, and VO is 2-3X the cost AEO.
Use Both Bid Types
Is there value in running multiple bid structures in case some burn out or perform differently as the marketplace or algorithm changes? For instance, if AEO underperforms versus VO, should you allow X% of spend on AEO in case it starts performing better?
In our experience, you’ll need to have both bid types setup in unique campaigns and be prepared to move the budget between AEO and VO.
Guidance to Maximize Your Bids & Budget Spend
Test Different Bidding Structures: Automatic bids focus on the lowest cost, while manual bidding gives you more control over your CPA to stay within your target cost. You can test both of these bidding models depending on the ads you’re running. VO is auto only, while you may find that AEO is better for manual bidding. Stay tuned as VO manual bidding will be coming soon for Facebook advertisers.
Running Multiple Bid Structures
Is there value in running multiple bid structures in case of some burnout or perform differently as the marketplace or algorithm changes? For instance, if AEO underperforms versus VO, should you allow X% of spend on AEO in case it starts performing better?
In our experience, you’ll need to have both bid types setup in unique campaigns and be prepared to move the budget between AEO and VO.
Test Bid Types with Auto-Bidding
We recommend you test bid types with and without auto-bidding. Manual bidding will require manual bid adjustments to maintain scale, which may trigger significant edits if you change more than 30%, but it can be more efficient in certain circumstances.
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- MAI – auto and manual bid both available
- AEO – auto and manual bid both available
- VO – the auto bid is the only current option, but the manual bid is in beta and coming soon
Increase Your Bid Amounts Incrementally to Find the Sweet Spot: Higher bids will give you more access to high-quality inventory, so try bidding high to capture paying users on AEO. Test a 10% change on your bids. If no significant edit was triggered, make a 20% change. Incrementally increase your bid until you find the tipping point. You can run this test on small and big budgets separately because smaller budgets will absorb a greater percent change without triggering the significant edit.
Pausing Ads / Ad Sets: Campaigns, ad sets, and ads should never be paused if you intend to spend additional money with them in the future. Any pause is considered a significant edit and restarts the learning phase.
Audience and Placement Targeting: When running AEO or VO bidding, it’s a Facebook best practice to run both broad targetings with all placements and auto-bidding. This allows Facebook to dynamically adjust bids and find the right audience regardless of the product they are using.
Test Audience Types to Maximize Reach Open Question
We recommend you test different audience types with different bid types to maximize reach while hitting financial goals. Here are the Facebook best practices:
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- MAI – lookalike audiences
- AEO – interests with wide-open age targeting 18-64+ (testing required to determine if targeting expansion is helpful)
- VO – broad audiences to maximize reach, use wide-open age targeting 18-64+
Manage Your Daily Spend Effectively: To land at the desired daily spend level without pausing your budget or triggering a significant edit, you can utilize CBO and set the desired daily budget at the campaign levels, or set auto-bidding. This ensures all your daily budget will be spent.
Starting Budget Recommendations for Ad Sets for Non-CBO Campaigns: Brand new accounts with no existing historical data should use a multi-ad structure. At least 2-3 ads minimum to start, within a single ad set, with budgets set at $100-$200 for the entire ad set.
Existing accounts with sufficient historical data should use a multi-ad structure with higher budgets (>$200 for the entire ad set). There is an obvious advantage to launching non-CBO ads with existing historical data because you already have a general sense of which ads work and do not work.
Best Practices for Scaling Volume
You can safely continue scaling an existing CBO budget after all ads have completed the learning phase, but there’s a spend threshold where ROAS will be impacted and you will have to either: (1) launch new audiences under new ad sets within the same campaign, or (2) launch new ads within the existing ad sets.
Best Practices for Significant Edits
You’ll have a positive impact on your campaigns if you make significant edits when pushing a new ad and re-setting the learning phase, or if you’re deleting a negative ad to avoid it counting towards your history.
Additionally, if you build up a negative history with an ad that stops performing well, you would benefit from the significant edit. It also makes sense to pause an ad and re-launch if it performed well and then stopped performing well at some point.
