How the Facebook Ad Auction Works

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So how much does Facebook advertising cost ? It varies depending on the type of strategy you want to set up . When you create a campaign or a sponsored ad, Facebook offers you two options to manage your budget:

Low-cost bidding strategy : This option is the most convenient in terms of cost benefits. It involves automatic campaign management, where the social network itself allocates your resources. It is the favorite among companies because it allows you to obtain a greater number of responses at the lowest cost.
Target Cost Bidding Strategy : Also known as manual campaign management, this strategy is favored by those with a lot of experience managing ads.
Its purpose is to reach the established cost per click. It is a very suitable strategy to obtain a greater number of conversions , to promote the installation of an app, to generate leads or to distribute free ebooks.

Consider that setting a high budget increases the total value of your ad. But the best practice is to first set up an ad that is relevant and high quality and then set the type of investment.

To work better on these aspects, however, it is necessary to know how the ad auction works on Facebook .

Do you know how auctions work?

Someone puts an item south africa cell phone number list up for auction and people bid for it. The winner is the person who is willing to pay the highest amount.

This also happens on Facebook, where there is not a product at auction but advertising space.

The price of the campaigns, therefore, is not fixed but is influenced by supply and demand .

When setting up a sponsorship, Facebook's algorithm carefully evaluates three aspects of the ad:

Bid : The bid refers to the budget you are willing to invest to reach your target and invite them to interact with your ad. This is a very important variable in the eyes of the algorithm.
Estimated Action Rates : Estimated action rates assess how likely it is that your target audience will interact with your ad. The higher the estimated action rate, the greater the chances that your audience will receive a well-profiled message.
Ad quality and relevance : These factors are determined by how users interact with your ad (interactions can be both negative and positive).
If the ad receives a high score it has a greater chance of success in the auctions.

To win the auction, your ad must score higher than your competitors . If you win the auction, your campaign will be shown to your target audience .