As a small business owner, creative entrepreneur, or digital marketer, you’ve likely contemplated running a Facebook ad campaign to promote your business or products. But before you head down this path, you want to know how much do Facebook ads cost?

According to studies, the average cost per click is 38 cents. However, there are so many factors that affect cost that the average doesn’t necessarily apply. Your target audience, the objective of the campaign, and your timing will all affect costs.

Why spending on Facebook ads matter

Whether you love social media or run from it, the truth is, it’s a part of most people’s lives. And Facebook is certainly no exception. The stats alone are mind-boggling:

• The third-most visited site in the world
• 2.74 billion monthly active users
• The second-most downloaded app
• 63% of the U.S. population over age 12 uses Facebook

In other words, if you need to advertise, then chances are extremely high that your audience is on Facebook. If you can take advantage of this power, then why not? And if you have been contemplating running a campaign, the numbers certainly support the idea.

Steps required to run a Facebook ad campaign

Before we dive into the cost for Facebook ads, let’s understand the steps it takes to get an ad campaign going. This helps you understand the overall costs, because determining your daily budget and campaign goal are essential in determining cost.

1. Launch the Ad Manager and create your campaign
2. Choose your daily budget and maximum you will spend each day for ads
3. Choose if you will pay for view, clicks, or downloads
4. Select the target audience based on desired demographics and interests
5. Create the images, copy, video and any other creative assets
6. Launch your ad
7. Select the bidding model for the ad campaign

As you can see, some of these steps have a direct impact on how much your ads cost. Your daily budget, what you pay for (clicks, views, etc.), and bidding model all determine how much your Facebook ads cost.

Related: 7 Great Facebook Ads Examples and How to Replicate Them

Factors influencing the cost of Facebook ads

Adspresso, a Hootsuite company, went through a detailed analysis of over $300 million in Facebook ad campaign spend with a 2020 study on the cost of Facebook ads. The study looked at several factors but concluded the range of costs for Facebook ads averaged $0.38 per click through September 2020.

But these are only averages. And there are several factors that determine the cost of your campaign. Here are the major contributing factors.

Campaign objective

A big impact to your Facebook advertising cost is your campaign objective. While you may assume all Facebook campaigns have the same goal of selling a product, this is only one of the many objectives.

The goal of your Facebook ad campaign could be:

• Increase the number of likes to your Facebook page (increase your brand awareness)
• Download an app
• Download an e-book
• Register for an event
• Click on a link
• Convert to a product sale

In the Adspresso study, the average cost of an app download was $3.40, whereas the average cost per like was only $0.20. Interestingly, the cost of an app download was as high as $6.13 per download in May 2020. This perfectly illustrates what a difference the campaign objective can make, which is super important as you’re budgeting for your Facebook ad spend.

Related: Tips for Advertising on Facebook: 8 Strategies for Amazing Ads

Bidding campaign

Facebook ads are purchased through an auction system. You’re essentially competing against other advertisers to get your ads placed. And as you guessed, the more competitive your bid, the better chance of getting the more in-demand timeslots and likely for your ad to be seen.

There are two types of auctions:

• Manual: If you choose manual then you’re setting a limit to how much you spend per bid.
• Automatic: If you choose automatic, you tell Facebook when to place your ad. The goal is to get the most engagement for the price.

Since these two types of auctions are completely different, it makes it tough to formulate a clear-cut strategy.

On one hand, you don’t want to bid too high because your budget can be blown out of the water. On the other hand, if you go too low then you won’t get the exposure and traction you’re looking for.

Facebook has an entire set of tips and tricks for managing this aspect of your campaign and you can check it out here.

When you run your ad campaign

As you know, Facebook is run by a complicated set of algorithms us normal people will never comprehend. These same algorithms are used to determine who is on Facebook the most and when. There are certain times of the day, days within the week, and weeks within the month that Facebook has more users than others. Depending on when you advertise during these periods of time can impact your cost.

The Adspresso study noted in Q1 2020 Sunday, Monday, Thursday, Friday, and Saturday were the most expensive days for generating likes, meaning Tuesday and Wednesday were the most affordable days to run a brand awareness campaign.

However, a cost-per-click campaign is less expensive to run on Saturday and Sunday. This shows how it’s both when you run your ads and campaign objective you choose makes a huge difference in cost.

You should also be aware the cost fluctuates. It’s all about supply and demand. So if there is increased demand for Facebook ads, then you’re going to pay more.

Ad placement

Where your ad is placed is another determining factor. Your ad can be in someone’s newsfeed, in stories, in messenger, search, in-stream videos, apps, and articles.

But then it gets even more granular.

For instance, if an ad appears in a newsfeed, there are several locations where the ad can go:

• The newsfeed
• Facebook desktop right column
• The marketplace
• A video feed
• The Facebook mobile news feed
• Instagram feed
• Instagram explore
• On the messenger home tab

As you can see, there are numerous options for ad placement, and this impacts how much your ads cost.

Target audience

You can target Facebook users for your ad campaign with a variety of different attributes. This includes targeting based on where they live, gender, income, and interests to name a few.

If you’re targeting women ages 25-54 then you’re competing against almost every other advertiser who is looking for the same profile. This means you’re going to pay more because it’s such a competitive demographic.

Ad optimization

Another factor for the cost of your ads is how you choose to optimize them. When you setup your Facebook ads, you have three different options to choose from:

• Optimize for clicks: If your goal is to get clicks, choose this option and your ads are placed where they are most likely to be clicked.
• Optimize for impressions: This allows your ads to be shown as often as possible, no matter who is likely to click.
• Optimize for audience reach: You want as many people to see your ad as possible.

Again, which option you choose affects what you pay. And your goal may be different for each campaign.

Related: How to Target Facebook Ads in 12 Easy Ways

How do I know how much Facebook ads cost?

If you’re overwhelmed by the prospect of calculating your Facebook ad spend, don’t worry. There are a couple of general rules to remember when budgeting your campaign.

First, Facebook estimates how much your campaign costs. You won’t go into it blind. While it’s pretty complicated to figure out the cost-per-click on your own (remember those algorithms we discussed?) Facebook does the math for you.

You can find Facebook ad calculators online, but it’s really not necessary.

Secondly, assume the average cost-per-click of $0.38 and plan your daily budget around this if you’re a beginner. Most people start with a budget of $5 to $10 per day, that’s roughly 13 to 38 clicks per day.

And don’t forget, if you’re concerned about ROI for your campaign, you can always run two simultaneous campaigns and see which ads generate the most success. This way you quickly determine what’s resonating or what’s not working.

The bottom line on Facebook ads

Answering the question “How much do Facebook ads cost” is a little more complicated than you might have expected. But as you can see, Facebook ads are not a blanket approach that works the same way for every business.

Before you sink your hard-earned dollars into a Facebook ad campaign, make sure you understand your objectives and your budget. Once you have these two major factors defined, then your Facebook campaign can give you the ROI you’ve been hoping for.