“How much should I spend on ads?” This is the question nearly everyone has, and I’m always appalled at how many people have been told ads aren’t worthwhile unless you can budget thousands toward them every month.
The reality of ads is that they are a tool available to you in the growth of your business on social media, and you can choose to use them as much or as little as suits you. So, how much money should you budget toward ads each month?
However much you can afford.
It’s really that simple. Ads can drive traffic into a funnel and sell thousand dollar courses every day, or ads can push your latest content to your warm traffic, or ads can tell you if your new offer is a good fit for your demographic.
I have seen “success” with $1k per day and $5 per day budgets.
Determining how much you can afford to spend is a different question. Here’s how you figure that out:
- Literally, how much can you afford to spend on ads every month even if you got no return? Divide that by 30 and you have a “testing budget”.
- Are you offering a sale at any point in the funnel or are you just building your list? For a funnel with no paid offer, you can never spend more than the testing budget.
- If you are offering a sale, you start with the testing budget for a few weeks and evaluate if you are making a profit, then increase from there.
- When you have run ads enough that you know your average cost per lead and your average conversion rates, base your ad spend on the strategy projection.
- It is also 100% okay to spend $20-$50 here and there to push a new post or a new lead magnet if you can’t add an ongoing budget line for ads.
Your budget is ENTIRELY based on what you can afford. It is good and worthwhile to collect data by running ads even with a lower budget or a short testing period.
What is more important is being able to read the metrics that you get back from your ads. Because it doesn’t matter if you spent $40 or $400, if you can’t tell what worked and what didn’t, You are still at square one.
Learn to Read Your Ad Metrics
The first thing Facebook asks when you create an ad is what Campaign Objective do you want? They are asking literally, “what is your goal for this ad campaign?” or “what would you like us to get for you?”
- If you want views on a blog post or podcast, choose TRAFFIC
- If you want likes, comments, and shares on a post, choose POST ENGAGEMENT
- If you want people to watch your video, choose VIDEO VIEWS
- If you want opt ins to your lead magnet or sales, choose CONVERSIONS and make sure you have the Facebook Pixel installed correctly. (Here is a video tutorial I did about that!)
Then use the Columns dropdown menu to see more details about how your ads performed.
I use Performance and Clicks most often, but if you are looking at video or engagement metrics, those column presets are very useful.
Make a system for tracking your ad performance, even if it’s just a Google Drive spreadsheet that you plug in the numbers so you can compare them later. Note down these metrics:
- Cost per result
- Cost per click
- Click through rate (link)
- Click through rate (all)
There are other important metrics, but these will tell you a lot about how your targeted audience is engaging with the ad you are showing them. You can use industry benchmarks like these to determine how your ads are performing.
The ultimate goal is to be running ads that give you a solid return on investment. And you can do that with any size budget when your targeting, offer, ad creative, and landing pages are optimized and effective.