Facebook Ad Budget Calculator
How to calculate your Facebook Advertising Budget:
Fill the column on the left with your own numbers:
- Your final revenue goal
- How much profit do you want to make
- The price of your product/service
- The cost to produce each product/service
- What percentage (%) of your leads will visit your sales material? (e.g. webinar attendees, add to cart)
- The conversion rate from sales material to actual sales (e.g. webinar sales, checkout completions)
A few notes about the budget for Facebook Advertising
There are no hidden or surprise costs when advertising on Facebook – you can determine your daily or lifetime budget and Facebook will only charge you for that exact amount.
To quote them directly:
“[y]ou tell Facebook how much you want to spend on advertising. Then we’ll try to get you as many results as possible for that amount. If you want to spend $5 a week, you can. If you want to spend $50,000 a week, you can do that too.”
Since you set your advertising budget within Facebook itself, it’s important to understand the difference between a Daily Budget vs. a Lifetime Budget:
- A Daily Budget will let you set how much you’re willing to spend on your ads per day. However, this option may waver and go slightly above or below the price you set.
- The Lifetime Budget lets you set the total amount you’re willing to spend for the length you run your post. This option will never go over the amount you set, making it easier to stick to a strict budget.
According to Facebook, there are two ways to define cost and help you know what you’ll be spending:
- Budget: Overall cost of your ad campaign
- Bid: Amount you are willing to pay for the result of your ad (impression, lead, etc)
The first is the budget of how much you’re willing to spend overall. The second is your bidding strategy which is a tool that controls your cost per optimization event (for example, cost-per-click or cost-per-acquisition).
Don’t forget that your budget and your bidding strategy need to match. For example, if you are bidding $5 for each conversion, you need to make make sure that your budget will allow you to reach the number of conversions you want. If your goal is 50 conversions, then your budget needs to be at least $250.
Ultimately, you control both – which means advertising on Facebook will cost you only as much you’re willing to spend.
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