On November 2017, Facebook introduced campaign budget optimization for businesses to have, “an easier way to manage their ad budgets and ensure optimal results.” Through campaign budget optimization, marketers can set one central campaign budget that Facebook will optimize across all ad sets in real time.
Currently, campaign budget optimization is still an optional setting for new campaigns. However, by September 2019, all Facebook ad campaigns will be migrated to campaign budget optimization. It will no longer be an option. It will become every marketer’s default.
With this change taking place in a few months, we will discuss whether Facebook Campaign Budget Optimization Default will be good or bad for your business.
Facebook Ads are an Integral Part of Most Marketers’ Campaign
For December 2018 alone, Facebook had 1.52 billion daily active users on average. Also, the social network had 2.32 billion monthly active users as of December 31, 2018. For this reason, 93% of marketers use Facebook advertising regularly. This means, approximately 3 million businesses have been using Facebook to market their business.
Facebook marketing has been proven to be so effective that according to the 2018 Social Media Marketing Industry Report, two in three marketers have stated that Facebook is their most important social platform.
The report also shows that Facebook ads are used by 72% of marketers, followed by Instagram which was used by only 31% of marketers.
What is Campaign Budget Optimization?
As stated earlier, Facebook launched campaign budget optimization as an option for businesses to control marketing budget at the campaign level. You have to turn this on if you want to use this feature.
If you choose to activate it, you can control the daily or lifetime budget for your campaign. If you have multiple ad sets within your campaign, Facebook’s algorithm will optimize the budget distribution across those ad sets.
How Does Campaign Budget Optimization Work?
This option is available in the “Guided Creation” workflow and in the “Quick Creation” editor. See photo.
Then you activate it, you will have a “campaign budget” instead of an ad set budget. You can also choose to have a “daily budget” or a “lifetime budget.”
Under Campaign Bid Strategy, you can choose between “lowest cost” and “target cost.”
In addition to this, Campaign budget optimization also allows you to set ad spend limits.
Setting ad limits, however, decreases the flexibility of your campaign but it allows you to have some control over your ads delivery.
To help users have a visual illustration of how campaign budget optimization can help a campaign, Facebook provided this example.
How It Works
With campaign budget optimization, advertisers allow Facebook to distribute their budget across ad sets to get the best results for their campaign.
In this example, the business has three ad sets and an overall budget of $30. If you don’t activate Campaign Budget Optimization, Facebook will spend $10 for each ad set regardless of the ad set’s performance. This resulted in 10 conversions.
With Campaign Budget Optimization, however, Facebook will react to the performance of each ad set and give priority to what it picks up as your top performing audiences and when it has exhausted the use of that audience, it will move on to other audiences. So, in the example, Facebook spent varying amounts between the three ad sets. The algorithm determined that ad set 2 had the most favorable opportunities to drive conversion before moving to ad set 1 and ad set 3. This resulted in 15 conversions.
Facebook does clarify that the example was used “for illustrative purposes only.” What business owners want to know ultimately is:
How will Facebook Campaign Budget Optimization Default Benefit Business?
Facebook has provided some benefits that campaign budget optimization provides:
⦁Less time needed to manage campaigns.
⦁ Since campaign budget optimization is automated, you don’t need to manually change budgets among your ad sets whenever you feel the need to reallocate your budget. This gives you more time to dedicate to other aspects of your business.
⦁It allows you to get more value from your marketing campaigns.
⦁Campaign budget optimization works continuously in real time. Consequently, you don’t spend too much time and money on poor-performing ad sets and capture the best results for your budget. Overall, this lowers your total cost per result.
⦁The campaign management process is simple.
⦁ With campaign budget optimization, you have fewer budgets to track and modify during the optimization process.
⦁Spending is more efficient.
⦁ Campaign budget optimization helps you spend more efficiently across audiences by finding the lowest cost opportunities across all ad sets and their target markets.
⦁Despite the benefits stated here, there are some drawbacks to using campaign budget optimization.
Disadvantages of Using Campaign Budget Optimization
There will be some limitations for marketers.
⦁ Since Facebook will automate some parts of your campaign, there will be some platform limitations for advertisers. Once you have published a campaign, you will no longer be able to daypart, use accelerated delivery or change your bid strategy. In addition, you won’t be able to use the import and export functionality with Power Editor to build campaigns using a template.
⦁These are not significant limitations, but they may hinder your use of more advanced strategies in the future.
⦁It’s not recommended for short-term campaigns and campaigns with one target audience.
⦁ To make campaign budget optimization really effective, Facebook’s bidding engine needs time to have a significant increase in activity to enable it to collect data. It is best, therefore, to make sure there is enough time to build a conversion history that will help improve campaign performance.
At present, there are no statistics on the popularity of this marketing tool. Presumably, not too many business use campaign budget optimization. Making it the default in all marketing campaigns on Facebook will not be easy for several businesses that have set methods on how they do their marketing campaigns. For new, less-experienced marketers, and advertisers with simpler campaigns; however, Facebook campaign budget optimization default will be useful.
Are you ready for the Facebook Campaign Budget Optimization Default?
As cliché as it sounds, this change is inevitable. The good thing is, you still have a few months to experiment with this feature before it becomes the default, especially if you’ve never used it before.
Give campaign budget optimization a chance. If you have doubts, check out BuzzFeed’s success story regarding their use of the Facebook campaign budget optimization tool for its branded content ads:
“We enjoy using the Facebook campaign budget optimization tool because it simplifies the optimization process while also giving us the lowest cost per performance, helping us to further connect BuzzFeed brand partners to our audience. And because the tool automatically distributes budget to the top-performing ad sets in real time, we’ll no longer have to manually optimize each ad set.”
Henry Van Zant Distribution Lead, BuzzFeed