Facebook ad bidding will be reasonable, I don't believe it!

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Recently small editors and small partners found that many customers will encounter a lot of balance, but advertising can not run out of the situation! Does this have much to do with people not understanding Facebook's ad bidding mechanism? So we're going to have a full profile of the Facebook auction today? Hope to help you maximize the efficiency of delivery.

What is the Facebook bidding mechanism?

Although Facebook's number of users is very large, but its number of users is not unlimited, the corresponding ad layout also needs to consider the user experience, so that there is a limit to the number of advertisers want to run ads, then you need to compete to win the exposure of ads.

In general, Facebook weighs the experience of advertisers against its own users, calculating through Facebook's own system that it will cast ads to people who may need them, not to say which advertiser pays a high price to display his ads, but to consider the advertiser's overall value.

As we all know, the most important factor affecting our ads is the choice of your audience, for example, whether your ads are well-made or not, and whether the discount is great value for money. It's hard to persuade an unmarried woman to buy children's clothing. So if the audience is accurate, the advertising performance will certainly be greatly improved, but the specific display of our ads to which users, is determined by Facebook's system algorithm.

So when we look at every Facebook bidding mechanism and choose the ad mix that works best for us, we get the best results.

Facebook has five bidding strategies.

√ 最低费用（Highest Value or lowest cost）

Cost Cap

Ad spend return guarantee (Minimum ROAS)

Bid cap

Target cost

Facebook supports both automatic bids (minimum fees) and manual bids (fee caps, ad spend return guarantees, bid caps, target fees). Advertisers can choose the right bid based on budget requirements and delivery expectations.

最低费用（Highest value or Lowest cost）

The lowest fee is the most common way for e-commerce advertisers to bid. With this strategy, you only need to set a budget, and you'll try to spend all of your budget by the end of your ad group's scheduling, while maximizing the value you get from your purchase. This bidding method is sure to cost you all your budget, and then you give as much results as possible to the budget.

Advertising costs return the bottom.

You need to set a budget and set bids (where bids represent conversions), control ad spend returns within your budget terms, and get the highest sales. In layman's terms, Facebook will use the data to target ads that have been used to make more purchases.

Ad Spend Return Guarantee is to help ensure that the bottom ROAS for a single optimization event is higher than a certain amount, and when you enter the ad spend return guarantee, Facebook strives to get the maximum purchase value so that ROAS is higher than the amount you enter.

Of course, if you set a high base value, you may not be spending your budget. However, if you're interested in the rewards you want from advertising. If you have a specific goal, you can select this item.

For example, if you're trying to attract new customers and are willing to lose a small amount of money in the short term, and over time this loss can be compensated by new customers, you can set the ad spend return guaranteed to 0.75, which is equivalent to a 75% return on advertising spending, which means you spend $100, which can generate at least $75 in shopping conversion value.

Target cost

You'll need to set a budget and set a bid to pay for the average cost per result you expect, which means That Facebook will try to help you get as much results as possible while keeping the average cost per performance no higher than the expected average.

The cost of a particular individual effort may be higher or lower than this average fee bid, but ultimately the average cost per effective will be equal to or lower than the average fee auction that you set up.

For example:

The budget is $50 and the average fee bid is set to $10. The system could end up costing $48, with six results, an average of $8 each. Of these six results, there may be $2 once and $12 once. But the final average of $8 is still $10 set by Hell.

This option can help you achieve a stable cost of single results.

Cost Cap

You need to set a budget and set a bid, which is the maximum amount you are willing to pay for each result. If you use this type of bidding, we'll try to help you get as much results as possible at a cost equal to or below the auction. The system will give priority to helping you get the highest quality users, and then when the highest quality users run, then look for not so high-quality users, while trying to make the cost lower than the set average amount.

Because the system will get users in the order of price from low to high within your bid. If your average cost per optimization event reaches the set value, which means that users at this stage are already done, you must raise your bid or you will not be able to spend money and your ads will stop running, which is the biggest difference between the cost cap and the target fee.

For example:

The same budget is $50, and the fee auction is set to $10. It's possible to end up with only four results, at a cost of $24. Because some effects above $10 exceeded the bid setting, it failed to launch successfully. This is in contrast to the target cost, with an average individual effectiveness cost of only $6 and a reduction in the cost per transaction, but with fewer opportunities for delivery.

Bid Cap

You need to set a budget, and set a bid, strictly according to the bid you set, so if the final conversion unit price does not reach the set value, the system will limit the bid per bid because of your bid, resulting in your ads not spending money.

For example:

If you set your bid to $5 and a $5.01 spot gets 10 purchases, we won't try to get those 10 purchases (but if you set a $5.1 bid, we might try to get those 10 purchases)

We recommend that you set a bid cap only when you have to control a single effectiveness charge, and we recommend a fee cap for the rest of the time.

Overall:

E-commerce generally choose the lowest cost, although the cost will be more frequent, but the effect is also better.

And in terms of cost and conversion.

Cost: Target fee auction.

Effect conversion unit price: Target Fee Auction.

Facebook optimizes events.

Optimize events to maximize your estimated ad action rate, and we can choose how your ads are optimized based on your ad goals.

For example:

When our ad goal is conversions, our optimization goals can be conversions, landing page views, link clicks, impressions, and more.

As shown in the figure below, where the conversion volume can be used to purchase, add to the shopping cart, initiate checkout, add payment information, and so on. This is when we use manual bidding, the goal of the bid becomes the target of the optimization event of our choice.

How Facebook ads are charged.

Facebook has developed a variety of ad charging methods for different advertising targets, and advertisers can choose the right way to maximize the effectiveness of their ads according to their needs.

Impression: Charges for your ad's impressions, which means that when your ad shows up, Facebook charges.

Link Click: Pay per click, a model in which people only charge if they click on your ad Facebook.

Installation Charges (App Install): Charges per installation.

User Behavior Charges (CPA): Charges based on user behavior, such as "joining a shopping cart," "buying behavior," and so on.

However, these charging methods are not free to choose, different advertising targets corresponding to different charging methods, see the figure below: