Let’s face facts here, Facebook is a pay-to-play social network. There are countless well-intentioned posts on social media saying that success on social media is all about community and quality content. While there is some truth to that, the reality is that most social networks are moving to a more pay-to-play environment. Facebook is leading the way in this arena. If you have a Business Page on Facebook (and you should), then you should be spending money on Facebook.
Why Businesses Need to Spend Money on Facebook
You could create the perfect piece of content, post it at the absolute perfect time, and have it seen by the exact right audience, and that audience might all engage with the content, then follow your Page, then share it with all their friends, then they may all like your page, and…
So, that won’t happen. Or, to be fairer, it is highly unlikely to happen. The more likely scenario is that, even if all other aspects of your Facebook marketing are solid, you’ll struggle to reach more than a handful of people if you do not spend money on Facebook. With more than 2.9 billion people on Facebook, and 2.5 billion pieces of content posted daily to Facebook, it is hard to reach people and compete for attention. The way to ensure that people see your business on Facebook, and to ensure your targeted audience is reached, is to pay for it through Facebook ads and boosts.
How Much Money to Spend on Facebook Ads
This is where we get into less of a black-and-white area as the suggested ad budget will vary substantially based on many factors, such as the overall marketing budget, the type of business and industry, your goals, and several other factors. The typical marketing budget for a company ranges from 5-12% of its revenue, with newer growth companies closer to 12% (or beyond for startups). Then, typically, a business will spend that same percentage on their Facebook Ads budget. For example, a company that spends 10% of their revenue on marketing would spend 10% of their marketing budget on Facebook Ads. With the above percentages as a guide, you can experience some success with as low as $1 per day on Facebook ads, though even for the smallest businesses, $5 per day is a more reasonable minimum, $10 per day if you’re looking to grow, and $20 per day if you’re an e-commerce business or selling directly online. For small or medium businesses looking for aggressive growth and are in sound financial standing, $40 per day is advisable. For large businesses, or e-commerce businesses looking to grow aggressively, the budget would be substantially more and vary greatly. If you are unsure what your budget should be, start small and increase the budget over time.
How to Allocate your Facebook Budget
This will also vary depending on all of the factors that contribute to why Facebook Ad budgets vary. This is where the opinion of the social media marketing professional giving their advice comes in. There are nine main types of Facebook Ads:
- Instant Experience
How you allocate your budget amongst those ads depends on many factors. For those in real estate or professional service, they made spend more heavily on lead ads. If they have the ability to produce video, they may spend more on video ads. For most businesses, especially small businesses, the bulk of their ad budget will be spent on Image ads.
Facebook Ads Audiences.
Facebook image ads are the most straightforward and easy to implement on Facebook. One quality high resolution (ideally text-free image), a catch 5-10 word headline, and you’re good to go. However, the audience you select is also paramount, even if you’re doing a type of ad as easy as a boosted post. In fact, with boosted posts, businesses often select either “people who like your page,” or “people who like your page and their friends,” and essentially throw their money away into the over-flowing Facebook bank account and see little results, if any. Here is the basic rule: You always want to take the time to select a targeted audience. When boosting a post, this option will be as, “people you choose through targeting,” as seen in the screenshot. However, we suggest setting up audiences through Facebook Ads Manager and creating what Facebook is now calling “Core Audiences,” or “Saved Audiences.” With a Saved Audience, you can select your target audience from all sorts of criteria, such as age, location, income range, job titles, interests, and more. If you have an established page, the Custom Audience options might be good, and the Lookalike Audiences are great options for businesses with good email lists.
Managing Facebook Ads
It is important to actively monitor your Facebook Ads. Ideally, you will be A/B split testing your ads and need to monitor which ads are performing the best. And, especially if you’re just starting out, you will want to be checking in on the performance of your ads to make sure there are no issues and that the budget is being well spent. You might make an error setting up an ad, and the ad does not reach anyone, or the ad may be going through significant spending with no results, and you can pause and adjust the ad.
Professionally Managed Facebook Ads
If you’re looking for a professional to manage your Facebook Ads, there are plenty that specializes in Facebook Ads. Note that if you already have internal marketing people, or you have a digital marketing agency handling your social media marketing, Facebook Ads will likely be an add-on.
Managing Facebook Ads requires experience and will take at least a few hours per week, and likely an hour or two per day for ad any budget over $1,000 per month. Typically ad specialists will start around $500 per month, sometimes with a start-up fee for the specialist to invest time learning about your company and designing the initial creatives and audiences. And, most experienced Facebook Ads specialists start at $1,500 or more per month. Then, that price will increase depending on the budget and specifics of your ads. For example, video ads will take significantly more time and resources, and can cost you $1,500-$2,500 per month for someone that specializes in video ads. (this does not include the actual ad budget).
If you have internal marketing employees, but who do not have significant Facebook Ad marketing experience, there are courses, conferences, and seminars that they can attend to learn. They can learn the basics to decently manage your Facebook Ads within a month or two. But, remember, if you are giving them the extra responsibility of Facebook Ads, and putting them in control of that budget, compensate them for that additional time. You don’t want an under-compensated unhappy employee managing your ads budget.
Facebook is pay-to-play. It can be frustrating to find out that Facebook is another item line in the budget that you need to spend on, but the reality is that having a Facebook Page is a must for most businesses, and you’re highly unlikely to experience any success on Facebook without spending a bit of money. So, open up the checkbook, spend a little bit on Facebook Ads, and see how your online presence and business grow.