Facebook Bidding Strategies and How select the right one for your Business


With over 2.7 billion monthly active users, Facebook offers a massive audience for businesses to target. The platform's ability to target specific demographics, interests, and behaviors has made it a must-have for businesses looking to increase their online visibility and reach.

The most apt “Bidding technique” is something that many Facebook advertisers disagree on. This is acceptable because there is rarely a clear "correct" or "wrong" answer. You test and choose what works best for you.

And with over 10 million active advertisers on Facebook competing for the same pool of buyers, having a compelling ad design and ad copy alone just doesn’t cut it anymore.

One element of success you must get right is your ad bidding strategy.

Ad bidding is an important component of your overall Facebook advertising strategy. A proper ad bidding strategy is required to ensure the success of your ad campaigns. Without it, even if your ad wording and audience targeting are perfect, you could lose money on your campaigns.

Using the incorrect bidding technique can result in spending too much for conversions or advertisements not being delivered due to too low bidding.

Factors affecting Ad Delivery

The three major criteria that determine ad delivery are as follows:

Your bid - This is the utmost amount you are willing to pay to win a bid. Facebook's system is designed to allow you to pay the smallest amount possible while still winning the auction. For example, if your highest-bidding competitor sets their maximum bid to $1 and you set yours to $1.5, you'll only have to pay $1.01 to win the bid, rather than the full $1.5 sum.

Relevance score - The relevance score of your ad is established by weighing all good interactions with your ad, such as liking, commenting, or clicking on it, against any negative interactions, such as concealing the ad or ignoring it. The relevancy score of your ad is very significant to Facebook. A high relevance score indicates that your ad will encourage individuals to spend more time on Facebook.

Estimated action rates-  are a feature of Facebook's ad distribution system that works behind the scenes. If the system predicts that your ad will receive a large amount of clicks, it will prioritise it over other ads.

Ad delivery options

Facebook currently offers two ad delivery options: standard and accelerated. Standard delivery is designed to distribute your ad spend evenly throughout the duration of your campaign (e.g. If you set a $140 budget for a 7-day campaign, Facebook will try to spend around $20 every day). This is the default delivery option.

Accelerated delivery tries to spend your ad budget and get the best results as quickly as possible. Using accelerated delivery might be useful when you’re in a rush to get your ads in front of people (say before the BFCM Sale).

Facebook Bidding Strategies

In general, we can categorise Facebook bidding strategies into three types: goal-based bidding, spend-based bidding, and manual bidding.

Goal-Based Bidding

Minimum ROAS

Users can use this strategy to set a minimum ROAS for each bid. As a result, the Minimum ROAS strategy is ideal for advertisers seeking greater control over the purchase value generated by advertisements. However, keep in mind that a functional pixel or SDK set up to track conversion events is required to use the minimum ROAS bidding strategy.

Cost cap

Users can use this strategy to set their desired Target cost-per-action (CPA). As a result, it gives you more control over the cost of your results. If you want to keep your costs under control, Facebook recommends this strategy as the default. The cost cap strategy is ideal for advertisers with specific CPA targets.

Spend-based bidding

Lowest cost

Users can use this strategy to maximise delivery and the number of conversions possible for a given budget. You have no control over your costs per result in this case. Despite the fact that the algorithm makes bids to obtain the lowest cost for the target action, it will spend the entire budget because the manual bid is not used here.

Facebook Bidding Strategies-Lowest Cost

This strategy is ideal for advertisers who do not yet know how much each prospect is worth and would like some "advice" from Facebook without being constrained by the manual bid. Overall, the lowest cost strategy saves time because Facebook does the bidding for you, but you have no control over your CPA, which means advertising can become very expensive over time.

Highest Value

This bidding strategy enables users to concentrate on increasing conversion value. In other words, the algorithm will direct its resources towards making the most valuable purchases while spending the entire budget. This strategy is ideal for advertisers who want to maximise their return on investment (ROI) and are willing to spend the entire budget but are unsure of the minimum ROI and bid amount.

Manual bidding

Bid Cap

Users can use this strategy to specify the maximum amount that can be spent in an auction. Simply put, the bid cap strategy gives users more control over their bids during an auction. It is critical to understand that the auction bid and the cost per result (or CPA) are not the same thing. As a result, unlike the Cost Cap and Target Cost strategies, the algorithm will not place a higher bid in the auction in this case. This strategy is ideal for advertisers who want to control costs while reaching as many users as possible through auctions.

You can also find more information in the official Facebook bid strategy guide that provides an overview of the available Facebook bidding strategies.

Which method you should use is determined by your specific offer as well as your overall aims. Before attempting to use the other two tactics, most advertisers should probably start with the lowest cost strategy and gather some data.

Best Practices to Improve your Facebook Ads Bid Strategy

Test different ad objectives within an ad campaign

Selecting the appropriate objective to bid on offers you complete control over how Facebook charges you for your advertisements.

To locate the ad objective that produces the best results for you, test multiple ad objectives inside the same campaign until you find the one that matches your campaign aim.

Facebook currently allows you to choose an objective for ad delivery optimization. The currently available objectives include:

Conversions – This is the default option. When using the Conversions objective, Facebook will try to deliver your ads to users who are the most likely to convert.

Brand Awareness – Designed to deliver ads to people who are most likely to pay attention to them.

Leads – Allows you to show your ads to people who are most likely to give out their information (e.g. their email address).

Landing Page Views – Designed to show you ads to people who are most likely to view your landing page.

Link Clicks – This option will make Facebook optimize your ads to get as many clicks from users as possible.

Post Engagement – The Post Engagement optimization delivers your ads to users who are most likely to interact with your ads by liking, sharing, or commenting.

Impressions – If you use the Impressions objective, Facebook will try to show your ad to as many users as possible.

Daily Unique Reach – This option allows you to deliver your ads to every member of your audience once per day. This is a great option if you’re offering a limited offer to a small remarketing audience.

It is vital to know that Facebook only charges you when the target of your chosen ad aim is met.

Furthermore, if you're wondering what the most common Ad objectives are among agencies and SMBs, we learned in this Databox's recent study on Facebook Ads performance that conversions are the most common Facebook ads objectives for agencies, followed by traffic, lead generation, and brand awareness, while brand awareness is the most common Facebook ads objective for SMBs, followed by conversions, traffic, and lead generation.

Place highest emphasis on rigorous testing

What is effective for one business may not be effective for another, and what is effective for one campaign may not be effective for another. The only way to discover your optimal bid approach is to do extensive testing, monitor results, and improve as you go.

You will be able to create standards for future campaigns based on data and enhance your ad bids with the knowledge gained by doing continuous tests over time.

Consider going for the lowest cost bid

On Facebook, the default bid method is the lowest cost and requires no manual control or effort. With this bid strategy, Facebook concentrates on providing you the best outcomes for your ad budget, i.e. you let Facebook make the decisions for you.

This method is recommended if:

  • You have a strict budget and specific objectives.
  • You have the time to keep track of your bids.
  • You've determined who your intended audience is.

Build custom audiences

Spending time gathering consumer data is an efficient method to improve your Facebook marketing bidding strategy (your ideal audience pain points, demographics, and interests). Make use of your newly acquired knowledge to target certain audiences with your advertisements.

When you run bids on specialised audiences, you have a better chance of lowering your cost per result while increasing conversions and ROAS.

Consider Minimum ROAS bidding strategy

The lowest ROAS bidding approach gives you more budget and revenue management. It is an excellent tactic for advertisers who want to be conservative when bidding and managing potential losses.

With this bid technique, you speak indirectly to Facebook in order to bid for the biggest revenue-generating prospects.

Here's how the minimum ROAS bidding technique works in practise:

Assume you have a $1000 advertising budget and your goal is to earn $1500 as a reward for your efforts. As a result, your return goal is 150% and your ROAS would be 1.50.

However, in order to avoid receiving few to no impressions, you must set a realistic target. If you set an unachievable objective and Facebook fails to meet it, your ad delivery may be terminated.

This ad bid approach is best suited for marketers who have access to historical data (to predict conversion rates and marginal cost) and have revenue-based targets.

Challenge your competition with a higher bids

Ads with high anticipated action rates, ad quality, and large bids generally win Facebook ad auctions.

With this in mind, it makes sense to adopt a high ad bidding strategy, since it increases engagement and allows your ad to be noticed by viewers that are more likely to take action.

You'll also be able to receive immediate insights on the performance of your ad campaign with this bid strategy. If you're spending a lot of money but getting little to no results, there's something wrong with your campaign that has to be fixed. Based on this information, you may examine your a and alter your offers to achieve the desired results.

Leverage the INSPECT Tool

The inspect tool on Facebook assists you in identifying ad performance issues and gaining insights into your ad set distribution (auction competition, audience saturation, audience overlap, and so much more).

Use this tool to acquire a more comprehensive picture of the impact of your ad bidding strategy on the increase or fall of your ad expenditures. Adjust and optimise your ad bidding strategy based on the knowledge gathered from utilising this tool.

Consider duplicating existing ad campaigns

Consider replicating an existing campaign rather than increasing your investment in the ad campaign to create big returns (ROI) while bidding with a limited budget. Maintain elements such as ad copy, landing page, placements, and so on, and assess the chosen target audience to avoid audience overlap.


To be able to run profitable Facebook campaigns, it’s important that you understand how Facebook’s bidding system works and considering there are a limited number of ad spots available, it is crucial to put your best foot forward when placing a bid.

Depending on your objectives, you will need to select an ad distribution type and optimization method, as well as a bidding strategy. As always, extensive testing is required to determine which combination of delivery type, optimization, and bidding approach works best for you.

Combining this knowledge with leveraging customer personas, leveraging funnel content and taking advantage of sales like the BFCM will help you generate maximum profits from your business.

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