Facebook advertising costs aren’t a straightforward thing to calculate. Instead, they are a result of the auction process and many factors that influence how much your ads will cost. Understanding what influences the price of an ad can help you plan your budget and get the results you want.

How much do ads on Facebook cost? These are the overarching goals for your ads: brand awareness, reach, traffic, app installs, link clicks, video views and more. The algorithm then determines which ads will achieve your objective and pairs those with users who meet the criteria of that objective. Choosing the correct objective will lower your costs, while a bad objective will increase them.

Breaking Down the Budget: How Much Do Ads on Facebook Really Cost

The next thing to consider is your bidding strategy and how aggressive you want to be. There are a few different options: automatic bid, manual bid and capped bids. You can find more information about each in the Ads Manager Help Center.

In general, higher-value actions (such as product catalog sales or store visits) drive higher ad costs because you are paying for the actual value of that conversion to your business. Then other things impact your cost per conversion such as the competition, your targeting and Facebook’s estimated action rate. Knowing the right strategies will help you drive more value from your ad spend and make Facebook a profitable channel for your business. The key is to focus on your audience, create relevant and high-quality ads, and then assess your bidding strategy and your bid investment.