- Включить нумерованное содержание?
- Да
Содержание
In this theoretical part, we will look at how the Facebook Ads algorithm works. The algorithm's operation necessitates knowledge of the basics, including how to get cheap leads and what to do in a situation where a lead becomes more expensive. Therefore, it is very important to understand the mechanics; this is the basis of an effective offer promotion strategy.
Facebook Ad Auction
After creating an advertising campaign in Facebook Ads and completing the verification stage, the ad goes to an auction. This auction considers many factors, including advertisers' bids, ad relevance to the target audience, and expected performance. The winner is the ad that best meets the auction criteria. This ad will appear on pages every time a user views their news feed or uses other Facebook services.
Forming an audience for displaying an advertisement
You must understand and visualize for yourself that the audience is formed in accordance with the funnel principle, which allows you to weed out some of the users at each stage.
This brings us to the concept of bidding in the Facebook advertising auction.
Bid in an advertising auction
The bid is a complex indicator that reflects the overall value of advertising for a potential user. It is important to understand that the bet is not just a sum of money or a specific number.
The bid is determined as follows: [Advertiser Bid] x [Estimated Action Rate] + [User Value] = Total Value (Final Bid)
It's important to understand that overall value is not a monetary amount but rather an abstract metric determined by Facebook's algorithm. The advertiser's task is to maximize the values of the variables in the formula in order to get more favorable conditions for his advertising.
Variable value in the rate formula
To understand how this formula works, let’s look at the meaning of all the variables:
Advertiser rate is the only variable that is set by the amount of the budget for the day, based on which we can predict the displaying formula.
Since the advertiser’s bid is set when creating an advertising campaign (AC), there are several strategies, and it is important for us to understand each of them:
Auto-bid (minimum price per lead)
This strategy, previously known as ABO (Automatic Budget Optimization), now has a new name, ACB (Advantage Campaign Budget), but the essence remains the same. The basic idea is that the ‘advertiser's bid’ depends on several factors that determine your position in the auction.
When using the "floor price" strategy, the value of the ‘advertiser’s bid’ variable becomes flexible and can be increased to compensate for other indicators in the formula, allowing the ad to be displayed. If you have low targeting frequency and low user value, Facebook may increase your "advertiser bid" to give you a chance to win the auction.
Lead price limit
A type of strategy in which the variable “advertiser’s bid” remains constant. This means that all parameters also remain the same, and Facebook cannot artificially increase one of them, as happens with the minimum price.
When you use the 'lead price limit' strategy, Facebook automatically optimizes how you allocate your budget across different audiences and ad campaigns to maximize the number of leads at your given cost.
Price per result (Limit price)
The strategy is a mixture of "floor price" and "lead price limit". Unlike "floor price", where Facebook can significantly increase your bid, in the "lead limit" bid, it doesn't touch it at all. With a "cost-per-result" strategy, Facebook has the ability to slightly increase your bid, but not significantly relative to the value you set manually. This is done so that the final price of the result is approximately equal to the value you set.
You can study the betting strategy in more detail on the official Facebook website in the section “About bid strategies”.
What strategy should a beginner in the field of arbitrage choose?
The answer is generally obvious, but still, so that you are not tempted to choose, we specify. At the initial stage, when you do not have experience creating advertising campaigns, in order to influence all the values of the variables, we recommend that you use an auto bid—the minimum price per lead.
The goal is to raise the approximate frequency of actions and provide high value to the user. This will allow you to pay less.
The approximate “frequency of actions” is an algorithm that allows you to determine whether displaying an advertisement will lead to the desired result. Some advertising materials simply match a person's interests, while others have a high likelihood of the user taking the targeted action. The ratings are based on associations and data about the performance of your advertising campaign.
For us, who work mainly with conversions, such indicators as leads (conversions) and clicks are important, which are displayed in the CTR and CR indicators, respectively:
In the Facebook help, there is a separate item on optimization:
Your daily budget should be at least 10 times the average cost of your target action. For example, if you are optimizing the display for a link transfer and the average cost per click is $5, your daily budget should be at least $50
Ad Quality (User Value) is an indicator that reflects users’ perceptions of the advertising after it has been shown. It is determined by assessing the number of positive and negative reactions to the advertising material.
Positive reactions include likes, clicks, reposts, comments, the percentage of video watched to the end, as well as the time spent by the user on the site. These reactions indicate active interaction with the advertisement and interest on the part of the audience.
Negative reactions include hiding advertisements from the feed and reporting content. If Facebook's artificial intelligence detects manipulation attempts, such as calls to "like this post" in the ad’s text or buying likes or comments through third-party services, this could also negatively impact the quality of the ad.
Based on information about these variables, we can conclude that effective advertising does not always depend on a high bid and a large budget. Even with a small budget, you can achieve success if the advertising material is of high quality and relevant to the audience.
How to influence an auction so that your ad always wins
Since our field is indirectly related to the field of Internet marketing, we have key metrics that are indicators of the relevance of your ad, and based on these metrics, we can optimize it, thus increasing the chance of winning the auction.
CTR: the ratio of shows to clicks and the percentage of users who saw your advertisement, clicked on it, and went to the site.
CR: the ratio of those who clicked on the ad to those who bought your product.
CPM: price per 1000 shows. The more you narrow your target, the higher the CPM, since the relevant audience is expensive.
Assessing the quality of advertising usually shows parameters above average or below average... Dy focusing on them, you can understand how interested the audience is in your creative.
A few strategies you can use to increase your CTR:
How the algorithm works to optimize an active advertising campaign
With an active advertising campaign, it is important to determine the target action that Facebook will consider key for optimization. This means that as your ad runs, Facebook collects data about those who interact with it and take the targeted action. Based on this data, the algorithm optimizes the ad’s showing by selecting an audience similar to those who have already shown interest and made a purchase.
The more information Facebook has about your audience, the more effective your advertising campaign will be. Facebook gathers information about users during the learning phase, which is a period during which Facebook tests different audience segments to determine which performs best.
The training period continues until you receive a sufficient number of conversions (targeted actions). According to FB help, you need 50. During this period, the price per result may fluctuate. For example, today the cost per lead could be $1 and tomorrow $5. Therefore, it is important to evaluate the cost of results over the course of the campaign to understand the average cost per result.
What can throw off optimization and education algorithms?
According to Facebook's official help, the training phase is only reset if "significant changes" are made.
These changes include changes to targeting, ad creative, optimization events (pixel events), adding a new ad to an ad set, and changing your bidding strategy. A budget change can also be a significant change, although this depends on the size of the change. Small changes, such as increasing the budget by a small amount, usually do not reset the training phase.
What are the targeted actions to optimize an advertising campaign?
Targeted actions play a key role in optimizing Facebook advertising campaigns. They determine what specific action the advertiser expects from the audience. This allows the platform to fine-tune ads' dispay and show them only to those users who are most likely to take the desired action. As a result, the use of targeted actions helps to achieve more effective results and increase the conversion of advertising campaigns.
So that you correctly associate how the campaign is optimized for the target actions:
There are only 4 main targeted actions that arbitrageurs use:
One of the unspoken rules when setting up an advertising campaign in the field of arbitrage is to “spread it broadly." That is, when creating an advertising campaign, you do not specify the target settings, thus “narrowing” it, and there are a couple of reasons for this:
First reason. The reason why we don't recommend narrowing our targeting is that it can lead to an increase in cost per 1000 views (CPM), which makes our traffic more expensive. However, in 99% of cases, this does not lead to an improvement in the conversion rate (CR); therefore, narrowing the target may not be profitable for us.
The second reason concerns that Facebook automatically tests various audience parameters such as age, geography, gender, and ad placement location. If Facebook sees that your ad is getting more conversions from one audience segment than another, it may stop showing our ads to the segment that isn't converting.
Thus, when setting up a target, you only need to select the geography and gender of the audience. Perhaps lower the age range a little, for example, by setting the range from 25 to 58 years.
When is the best time to launch an advertising campaign?
On Facebook, the advertising budget is distributed by calendar day, which means that the closer to the end of the day, the faster it is spent. Because Facebook strives to spend all of a given budget within a given time frame (and there is little time left), this may result in participation in less profitable auctions where the price per result may be higher.
Therefore, it is very important to set up a newly created advertising campaign at 00:00 by the geo of its running. This way, you will be one of the first to enter the auction, and your budget will be distributed over the next 12 hours and spent evenly.
Conclusion
In conclusion, it can be noted that the Facebook algorithm plays a key role in the optimization and effectiveness of advertising campaigns on this platform. The algorithm uses various data and signals to determine which ads to show to a specific user based on their interests, behavior, and preferences. This allows advertisers to achieve higher relevance and performance for their ads, improving metrics such as CTR, conversions, and ROI.
Let's move on to practice
Now let's move on to practice and try to launch an advertising campaign: [Day 7] Setting up and launching an Advertising Campaign
Facebook Ad Auction
After creating an advertising campaign in Facebook Ads and completing the verification stage, the ad goes to an auction. This auction considers many factors, including advertisers' bids, ad relevance to the target audience, and expected performance. The winner is the ad that best meets the auction criteria. This ad will appear on pages every time a user views their news feed or uses other Facebook services.
Forming an audience for displaying an advertisement
You must understand and visualize for yourself that the audience is formed in accordance with the funnel principle, which allows you to weed out some of the users at each stage.
- First stage: Facebook selects audiences based on your chosen targeting criteria, such as age, gender, location, and interests.
- Second phase: From the previous audience, those users are selected who are online at the time the advertisement is displayed and can see it.
- Third stage: Facebook determines from the previous audience those who, according to the system, are most likely to take the desired action, for example, follow a link or make a purchase.
This brings us to the concept of bidding in the Facebook advertising auction.
Bid in an advertising auction
The bid is a complex indicator that reflects the overall value of advertising for a potential user. It is important to understand that the bet is not just a sum of money or a specific number.
The bid is determined as follows: [Advertiser Bid] x [Estimated Action Rate] + [User Value] = Total Value (Final Bid)
It's important to understand that overall value is not a monetary amount but rather an abstract metric determined by Facebook's algorithm. The advertiser's task is to maximize the values of the variables in the formula in order to get more favorable conditions for his advertising.
Variable value in the rate formula
To understand how this formula works, let’s look at the meaning of all the variables:
Advertiser rate is the only variable that is set by the amount of the budget for the day, based on which we can predict the displaying formula.
Since the advertiser’s bid is set when creating an advertising campaign (AC), there are several strategies, and it is important for us to understand each of them:
Auto-bid (minimum price per lead)
This strategy, previously known as ABO (Automatic Budget Optimization), now has a new name, ACB (Advantage Campaign Budget), but the essence remains the same. The basic idea is that the ‘advertiser's bid’ depends on several factors that determine your position in the auction.
When using the "floor price" strategy, the value of the ‘advertiser’s bid’ variable becomes flexible and can be increased to compensate for other indicators in the formula, allowing the ad to be displayed. If you have low targeting frequency and low user value, Facebook may increase your "advertiser bid" to give you a chance to win the auction.
Lead price limit
A type of strategy in which the variable “advertiser’s bid” remains constant. This means that all parameters also remain the same, and Facebook cannot artificially increase one of them, as happens with the minimum price.
When you use the 'lead price limit' strategy, Facebook automatically optimizes how you allocate your budget across different audiences and ad campaigns to maximize the number of leads at your given cost.
Price per result (Limit price)
The strategy is a mixture of "floor price" and "lead price limit". Unlike "floor price", where Facebook can significantly increase your bid, in the "lead limit" bid, it doesn't touch it at all. With a "cost-per-result" strategy, Facebook has the ability to slightly increase your bid, but not significantly relative to the value you set manually. This is done so that the final price of the result is approximately equal to the value you set.
You can study the betting strategy in more detail on the official Facebook website in the section “About bid strategies”.
What strategy should a beginner in the field of arbitrage choose?
The answer is generally obvious, but still, so that you are not tempted to choose, we specify. At the initial stage, when you do not have experience creating advertising campaigns, in order to influence all the values of the variables, we recommend that you use an auto bid—the minimum price per lead.
The goal is to raise the approximate frequency of actions and provide high value to the user. This will allow you to pay less.
The approximate “frequency of actions” is an algorithm that allows you to determine whether displaying an advertisement will lead to the desired result. Some advertising materials simply match a person's interests, while others have a high likelihood of the user taking the targeted action. The ratings are based on associations and data about the performance of your advertising campaign.
For us, who work mainly with conversions, such indicators as leads (conversions) and clicks are important, which are displayed in the CTR and CR indicators, respectively:
- eCTR - this is the predicted click-through rate
- eCR - predicted conversion rate.
In the Facebook help, there is a separate item on optimization:
Your daily budget should be at least 10 times the average cost of your target action. For example, if you are optimizing the display for a link transfer and the average cost per click is $5, your daily budget should be at least $50
Ad Quality (User Value) is an indicator that reflects users’ perceptions of the advertising after it has been shown. It is determined by assessing the number of positive and negative reactions to the advertising material.
Positive reactions include likes, clicks, reposts, comments, the percentage of video watched to the end, as well as the time spent by the user on the site. These reactions indicate active interaction with the advertisement and interest on the part of the audience.
Negative reactions include hiding advertisements from the feed and reporting content. If Facebook's artificial intelligence detects manipulation attempts, such as calls to "like this post" in the ad’s text or buying likes or comments through third-party services, this could also negatively impact the quality of the ad.
Based on information about these variables, we can conclude that effective advertising does not always depend on a high bid and a large budget. Even with a small budget, you can achieve success if the advertising material is of high quality and relevant to the audience.
How to influence an auction so that your ad always wins
Since our field is indirectly related to the field of Internet marketing, we have key metrics that are indicators of the relevance of your ad, and based on these metrics, we can optimize it, thus increasing the chance of winning the auction.
CTR: the ratio of shows to clicks and the percentage of users who saw your advertisement, clicked on it, and went to the site.
CR: the ratio of those who clicked on the ad to those who bought your product.
CPM: price per 1000 shows. The more you narrow your target, the higher the CPM, since the relevant audience is expensive.
Assessing the quality of advertising usually shows parameters above average or below average... Dy focusing on them, you can understand how interested the audience is in your creative.
A few strategies you can use to increase your CTR:
- Compelling Title and Description: a title and description that will interest your audience and make them want to know more.
- Relevant Image or Video: the image or video should grab attention and generate interest in your product or service. A creative should be bright and juicy!
- Targeting: setting up a target so that the ad is shown to those users who are most likely to complete the target action. Although arbitrageurs play broadly, when scaling, this is more than relevant.
- Call to Action (CTA): an attractive call to action in an ad.
How the algorithm works to optimize an active advertising campaign
With an active advertising campaign, it is important to determine the target action that Facebook will consider key for optimization. This means that as your ad runs, Facebook collects data about those who interact with it and take the targeted action. Based on this data, the algorithm optimizes the ad’s showing by selecting an audience similar to those who have already shown interest and made a purchase.
The more information Facebook has about your audience, the more effective your advertising campaign will be. Facebook gathers information about users during the learning phase, which is a period during which Facebook tests different audience segments to determine which performs best.
The training period continues until you receive a sufficient number of conversions (targeted actions). According to FB help, you need 50. During this period, the price per result may fluctuate. For example, today the cost per lead could be $1 and tomorrow $5. Therefore, it is important to evaluate the cost of results over the course of the campaign to understand the average cost per result.
What can throw off optimization and education algorithms?
According to Facebook's official help, the training phase is only reset if "significant changes" are made.
These changes include changes to targeting, ad creative, optimization events (pixel events), adding a new ad to an ad set, and changing your bidding strategy. A budget change can also be a significant change, although this depends on the size of the change. Small changes, such as increasing the budget by a small amount, usually do not reset the training phase.
What are the targeted actions to optimize an advertising campaign?
Targeted actions play a key role in optimizing Facebook advertising campaigns. They determine what specific action the advertiser expects from the audience. This allows the platform to fine-tune ads' dispay and show them only to those users who are most likely to take the desired action. As a result, the use of targeted actions helps to achieve more effective results and increase the conversion of advertising campaigns.
So that you correctly associate how the campaign is optimized for the target actions:
There are only 4 main targeted actions that arbitrageurs use:
- Traffic is a targeted action in which an advertisement will be shown to an audience that, according to the Facebook algorithm, is likely to click on a link and go to the site.
- Engagement is a targeted action in which the audience is more likely to interact with a promotional post, such as liking, commenting, or sharing it.
- Lead is a targeted action that makes the audience more likely to fill out a lead generation form.
- Sales: Facebook will show ads to audiences who are more likely to make a purchase on the site.
One of the unspoken rules when setting up an advertising campaign in the field of arbitrage is to “spread it broadly." That is, when creating an advertising campaign, you do not specify the target settings, thus “narrowing” it, and there are a couple of reasons for this:
First reason. The reason why we don't recommend narrowing our targeting is that it can lead to an increase in cost per 1000 views (CPM), which makes our traffic more expensive. However, in 99% of cases, this does not lead to an improvement in the conversion rate (CR); therefore, narrowing the target may not be profitable for us.
The second reason concerns that Facebook automatically tests various audience parameters such as age, geography, gender, and ad placement location. If Facebook sees that your ad is getting more conversions from one audience segment than another, it may stop showing our ads to the segment that isn't converting.
Thus, when setting up a target, you only need to select the geography and gender of the audience. Perhaps lower the age range a little, for example, by setting the range from 25 to 58 years.
When is the best time to launch an advertising campaign?
On Facebook, the advertising budget is distributed by calendar day, which means that the closer to the end of the day, the faster it is spent. Because Facebook strives to spend all of a given budget within a given time frame (and there is little time left), this may result in participation in less profitable auctions where the price per result may be higher.
Therefore, it is very important to set up a newly created advertising campaign at 00:00 by the geo of its running. This way, you will be one of the first to enter the auction, and your budget will be distributed over the next 12 hours and spent evenly.
Conclusion
In conclusion, it can be noted that the Facebook algorithm plays a key role in the optimization and effectiveness of advertising campaigns on this platform. The algorithm uses various data and signals to determine which ads to show to a specific user based on their interests, behavior, and preferences. This allows advertisers to achieve higher relevance and performance for their ads, improving metrics such as CTR, conversions, and ROI.
Let's move on to practice
Now let's move on to practice and try to launch an advertising campaign: [Day 7] Setting up and launching an Advertising Campaign
Последнее редактирование модератором:
