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How much should you spend on Facebook Ads?


This simple, logical formula will help you plan your social ads spend.

Facebook advertising offers a relatively low cost, highly effective form of advertising. For many growing businesses, Facebook ads is the most powerful advertising method available, as it allows for clear measurability, and access to very targeted audiences at a relatively low cost.

While there is no one-size fits all formula to help a business calculate their budget for a Facebook ads spend, we have created a formula below that will help businesses begin to set concrete marketing and spending projections for their efforts.

A Few Helpful Statistics to Note:

  • Average Facebook Ad Click-Thru Rate: 0.9%
  • Average Website Conversion Rate 1.0%-10.0%
  • Average Facebook Cost Per Click $0.64
  • Average Facebook Cost Per 1,000 Impressions: $5.99
  • 6 to 8 touches to make a sale
  • Conversions with remarketing is 4x higher than native efforts


Step 1: Determine your goal for Facebook Advertising

Are you looking to build brand awareness? Consider measuring impressions or reach. Are you seeking to get online conversions such as contacts, sales, or sign-ups for your email list? Measure things like website click-thru. (Click here to view our guide to measuring marketing success for more measurement ideas.)


Step 2: Gather Data

You’ll need to find the following pieces of data about your own marketing:

  • How many visitors does it take to convert (contact or email sign-up) on your website?

Configure Google Analytics Goals to determine this. If you don’t have that figure, assume a 1-3% conversion rate for initial estimation purposes. If you get direct sales through your site, you’ll want to adjust your numbers below to accommodate.

  • What is your sales process conversion rate for individuals who contact you or sign up for your email list? Once someone signs up for your email list or contacts you, what is the likelihood that they will become a customer or client?
  • How much valid (non-spam) traffic does your website receive each month from sources other than Facebook, such as Google, referral traffic, or email marketing?


Reverse Engineer Your Path

Let’s say that you’ve decided your business requires 10 sales per month. You’ve gathered your data and figured out that:

  1. You have a 1% conversion rate on your website. Therefore, for every 1,000 visitors that you receive, 100 of them sign up for your email list or contact you for more information.
  2. You have a 25% sales process conversion rate. For every 100 people that sign up for your email list or contact you, 25 of them become customers or clients.
  3. You receive 500 visitors per month from sources such as email, search engine traffic, and referrals.

From this data, you can glean that it will take 1,000 qualified visitors to achieve 10 sales per month. (Note: this will strongly depend on your sale process, but this should bear true, as it is based on your historic performance data.)


  • 1,000 Visits Per Month x 1% Conversion Rate=100 contacts per month
  • If, of 100 contacts, 10% end in a sale – 1,000 visitors should yield 10 sales per month.
  • If you get 500 visitors per month from sources such as email, search engine traffic, and referrals, you will need an additional 500 visits from qualified, interested parties.
  • Facebook Ads yield 0.9% click-thru rate. Therefore, it will take 55,555 website impressions to achieve 500 qualified website visitors to bring you to that goal of 1,000 qualified website visitors each month.
  • Average cost per 1,000 impressions = $5.99
  • Therefore, $329.45 per month would be the LOW end of your budget, assuming that your visitors are warm, well-qualified, well-targeted leads. This is assuming that you can convert someone in just 1 impression or interaction, because they are already familiar with what you have to offer. Remember that earlier statistic, 6 to 8 touches to close a sale…
  • If your audience is not established and has not had any interactions with you in the past, you will only be reaching non-fans to sell, drive traffic, and grow your lists. That is less effective and more expensive than targeting fans who expect (and desire) to see your content. You will need to multiply the number above times 6 or 8 in order to engage each individual enough to get them to convert. Therefore, you can expect that the HIGH end of your budget would be $1,976.70 to $2,635.60 per month


Ways to reduce your cost

The numbers above may seem impossible to budget for. Remember that over time, you can reduce your cost by keeping your audience engaged. You can also reduce your cost through retargeting (which has been shown to be up to 4x more effective, and 50% less expensive than ads without pixel retargeting). Here are other ways that you can reduce the cost of your Facebook ads spend:

  • Quality targeting
  • Long-term relationships with a warm and active audience
  • Retargeting with Facebook Pixels (increase conversion by 4x, reduce cost by as much as 50%)
  • Increase traffic from other sources by improving your search rank, email quality, and referral traffic

If you’re looking for other ways to grow your business through a comprehensive strategy, consider our small business coaching program, available to businesses nationwide. Click here for more information on marketing and business coaching.

If you want to learn more useful information like this, consider our Liftoff Business classes, available in person (in St. Louis) or online. Click here to view our schedule.



NEW CLASS: Learn Facebook Ads March 31st

Join us for a Facebook Ads Workshop to learn Facebook ad strategies and how to utilize Facebook ad tools to drive successes toward your business goals. There are a variety of ways to advertise on Facebook. This course will walk you through the various options for ads, as well as help you create ads on Facebook that will accomplish the marketing objective you have for your business. •Know how your bid is calculated and how to win a spot in the ad auction •Understand how you show ads to people throughout the day •Understand the kinds of factors that affect ad delivery •Learn how to create and manage Facebook ads tailored to your goals. Cost is $25.00. Space is limited. RSVP

everything you need to know about Facebook retargeting

Everything You Need to Know about Facebook Retargeting

Facebook Ads have become an increasingly valuable marketing tool, but one aspect that too many people are overlooking is the power of Facebook Retargeting. If you aren’t using it, or are still unsure of what it is and how it works, allow us to educate you.

What is Facebook Retargeting?

Retargeting isn’t new to the internet, Google calls this practice Remarketing and has been doing it for years, but Facebook only started using this tactic in 2012. Facebook Retargeting involves a customer visiting your website and not completing the desired action, such as making a purchase or contacting your company. That customer will later see an advertisement for your company on Facebook, prompting them to return to your website and, hopefully, follow through with the desired action.

How does this marketing principle work?

This is actually just a version of a basic sales principle. When a customer is interested in a product or service, they research it, but studies show that most consumers need a bit of a nudge to actually purchase something. Before, this was accomplished by a follow-up phone call or even an email. Facebook Retargeting allows you to complete the “follow up” by targeting your consumers on a website that most Americans already visit at least once a day.

Once a consumer leaves your website, if you don’t do any follow up, you can only hope that they will have the personal motivation to come back and make a purchase. However, retargeting gives you the chance to remind the consumer that you want their business. When a visitor views your site, a code is inserted into their browsing history. This code is later triggered while the consumer is on Facebook, prompting Facebook to show that consumer an ad for your company.

Facebook Ads already allows you to narrow in on consumers with specific interests, ages, locations, and more, but retargeting with pixels lets you hone in on an audience that you know has already shown interest in your company in the past.

Mobile Retargeting

Facebook Retargeting also gives you an incredibly valuable marketing tool that allows you to target people on their mobile phones. The large majority of Facebook users access Facebook on their phones while away from their computers, and many of them check out Facebook on their mobile devices more often than on their computers, so you have a unique opportunity to get your company’s ads in front of a solid audience.

Why it works for consumers

One of the main reasons Facebook Retargeting is so effective is that consumers don’t mind being targeted. While the idea of placing a code into someone’s browser and following them around the internet may sound a bit stalker-ish, consumers overwhelmingly report that they do not mind when they see retargeted ads on their Facebook. The chart below shows that the majority of consumers are neutral to the use of Facebook Retargeting, and 30% of consumers would actually be quite happy to see the ads. (Source)

It seems like Facebook users actually like getting a reminder to go back to a site they were previously browsing. Facebook Retargeting gives you a chance to gently remind consumers that the products they left sitting in their online cart are still there, waiting for them, and get them to come back to your site and finish the checkout process.

Huge Return on Investment Potential

Facebook has over 1.5 billion active users worldwide, with most of those people visiting at least once, if not multiple times a day. By focusing more marketing funds towards Facebook Retargeting, you can get yourself seen by the people who have already shown an interest in what you have to offer. In many ways, this is a passive way of following up with your customers in a way that not only saves you time (no need to write follow up emails or make phone calls) but also feels less intrusive to your customers, as you are reaching them while they are casually scrolling through a website they enjoy visiting, not filling up their inbox or voicemails with pushy-sounding messages.

How can I set up Facebook Retargeting in my ads?

The setup process seems scary and technical, but it is actually quite simple! Here are the steps:

Facebook ads manager

  1. Visit your Ads Manager on the left side of your page.


facebook ads manager main menu tools2. Go to the “Tools” drop-down menu in the upper left-hand side of the page

facebook retargeting pixels

3. Select “Pixels” from the menu

set up facebook pixel

4. You should then be directed to this page where you can easily create the pixel

5. The next steps are easy to do since Facebook guides you through the rest!

Note: you may need your web developer to insert the new Facebook pixel in your header.php file. It will take them no time!

Want to learn more about Facebook ad strategies and how to utilize Facebook ad tools to drive successes toward your business goals? Take our course Wednesday March 16th, from 8:30-11:30 a.m.! Tickets are available here.