Manual Bidding For Facebook
Have you ever been to a live auction? There’s something absolutely electrifying about live bidding and the auctioneer’s call-outs! An auction is one of the most fun and competitive ways to buy things. Although they had largely fallen out of favor in the mainstream marketplace, the evolution of the internet in the late 90s brought them back to the limelight with sites like Ebay, causing a surge in their popularity.
It turns out that competing for something against fellow shoppers, even online, triggers something primal in our brains that makes it especially gratifying to buy (or win). The ability to bid on something online makes the experience essentially frictionless, which really adds fuel to our competitive fire.
The World’s Largest “Secret” Auction:
So what does all that have to do with Facebook Ads?
I’m glad you asked.
Many people who run ads on the Facebook platform are completely unaware that behind the scenes, the world’s largest “secret” auction is happening. And everyone on the Facebook platform is taking part! Advertisers (like you) are “bidding” for the opportunity to show their ads to Facebook’s users. And due to the limited amount of “eyeball real estate” the competition can get pretty fierce.
Most people have no idea that they can basically “flag down” the auctioneer (Facebook), and manually bid on the audience they specifically want their product in front of. Or more accurately, they can manually OUTBID their competition for the same premium audience.
Once you understand this, you can absolutely DOMINATE your competition, because 99% of them are using automatic bidding, which is essentially allowing the auctioneer to bid for you!
Now there’s a time and a place for automatic bidding, BUT, when you really want to ensure that your audience sees your product first, you can simply take over the controls and outbid your competition.
Used correctly, this can offer you an incredibly powerful competitive advantage, and those who know how to correctly deploy it can use it to not only dominate awareness in their niche, but also overpower their competition with brute force bidding strategies.
So how does manual bidding actually work?
Most people, when given the choice between something manual and automatic, will choose automatic. It just sounds easier, and the idea of controlling all the variables sounds complicated and intimidating. That being said, although it sounds complicated, it doesn’t have to be.
There are really only a few basic variables that control your ad placement, such as Price and Relevance. How much you bid per action (price) is an excellent cost control tool. For example, if you are selling a product that costs $10 and you know 1 in 4 clicks convert, you’d want to set your bid cap at $2.50 (or less). That way, you can control your total cost and manage it within your predicted range of profitability.
Much like any manual market manipulation strategy, there are many complicated blueprints for deploying a “perfect” manual bidding campaign. But the reality is that due to the manual nature of the strategy, the best plan is to test, test, and test some more until you eventually hone in on a deadly effective deployment. For the purposes of this tutorial, we will only cover the basics of manual bidding, but there are many guides out there (such as the HCom Training) that can offer advanced strategies with blueprints for manual bidding.
“A bid represents what you’re willing to pay to achieve your desired result from someone in your target audience. However, your bid is not the cost of your chosen optimization event. If you want to directly control for the cost of an outcome, then use cost cap or target cost.” – Facebook Blueprint
Facebook offers a phenomenal overview to bid strategy here: https://www.facebook.com/business/m/one-sheeters/facebook-bid-strategy-guide
Although the options can seem overwhelming, there are only a few important bid strategies you need to be familiar with to get started.
Cost vs. Control
Facebook created a flowchart to clarify the opportunities and outcomes. Your first decision is really deciding whether it’s more important to you to manage your cost per action or control.
As pictured in the diagram, if you want to proceed with no cost control, simply set to lowest cost (autobid) and allow the algorithm to work its magic.
However, if cost control is part of your strategy, you can deploy one of these options:
- Cost cap: Get the most results possible while staying within the CPA benchmarks
- Bid Cap: Maximum results without exceeding your bid cap.
- Target Cost: Seek only results that cost close to your predetermined goal.
That being said, there are a few things to consider when deploying these options:
Cost Cap is great for getting high volume, but your cost may increase as your budget increases. In other words, Cost Cap aims to minimize cost by delivering the cheapest results first.
Bid Cap is best for controlling bids in the auction, however, you should note that the bid is different than the cost per result. Remember, with bid cap bid strategy, your bid control sets the maximum amount you’re willing to pay to reach your target audience, it’s not the cost you ultimately pay.
Target Cost is best for keeping your cost consistent, however, if your costs stay fixed as your budget increases, you could miss out on cheap results. Facebook recommends that you consider starting with the ideal average cost you’d like to pay and increasing it from there as needed.
Ultimately, using a manual bidding strategy can accomplish quite a few advantageous things, such as optimizing your ad spend, allowing you to strategically scale a campaign or even outbidding your competition directly when necessary.
However, it’s important to fully understand your manual strategy and deploy it due to an intelligent evaluation of your intended outcome.
Remember, manual bidding is a powerful tool to have in your arsenal when used effectively. So invest the time it takes to get familiar with it, and then use it to dominate your niche and scale to the moon!
Choosing the Right Bid Strategy
*(courtesy of Facebook Blueprint: https://www.facebook.com/business/m/one-sheeters/facebook-bid-strategy-guide)
Available bid strategies
Who sets the bid?
When to use
|Lowest cost (auto bid)||Brand awareness, reach, traffic, engagement (post engagement, page likes, event response), app installs, video views, lead gen, messages (excludes sponsored messages), conversions, product catalog sales||Want to spend full budget
Need to understand what bid/cost to use for other bid options
|Hands-off; Facebook manages bidding
Reach all lowest cost opportunities while spending your budget
|No control over your cost
Costs can rise as you exhaust least expensive opportunities or as you increase budget
|Bid cap||Advertiser||Reach, traffic, engagement (post engagement, page likes, event response), app installs (installs, events, link clicks, video views), video views, lead gen, messages, conversions, product catalog sales||Want to set a max bid across auctions to control cost and reach as many users as possible at that bid||Maximize volume at specified max bid
Can increase competitiveness against other advertisers targeting similar audiences
|Need to spend more time managing bids to control cost
Costs can rise as you exhaust cheaper opportunities or increase your budget
May not spend full budget
Bid is not the cost you’ll see in reporting
|Cost cap (100% availability)||Traffic, app installs, event responses, lead gen, offsite conversions, and catalog sales with the following ad delivery optimizations: landing page view, link clicks, page likes, post engagement, replies, video views, product catalog sales w/ link click an offsite conversions||When you want to maximize cost-efficiency
When you need to keep cost within a specific threshold
|Maximize conversion volume within your acceptable CPA/CPI
Minimize your cost when possible without manually adjusting your bids
|Cost may rise as you run out of cheapest opportunities
Learning phase requires more aggressive exploration
May not spend full budget once you hit the cap
|Target cost||Traffic, app installs (installs, app events, video views), lead gen, conversions, product catalog sales||When you want to maintain a consistent cost||Cost predictability
Get the most conversions possible at the target cost
|Lose out on all cheaper results
May not spend your entire budget
|Value optimization with min ROAS||App installs, conversions and catalog sales||If ROAS is the primary measure of success and you’re able to pass back transaction values to our platform||Focus campaign performance on the bottom line and ROAS
Get the most opportunities while maintaining minimum ROAS
|Specific to value optimization
Setting the benchmark too high may lead to under-delivery
|Highest value||App installs, conversions and catalog sales||Want to get the highest ROAS, want to spend full budget and when unsure of min ROAS/bid amount||Hands off; Facebook manages bidding
Achieve highest value results while spending your budget
|Specific to value optimization|