# Facebook Ads COST CAPS? Yes or No? Channel: Ben Heath Video: https://www.youtube.com/watch?v=0ur-uowvaac Duration: 10 min Language: English Words: 2341 Transcript page: https://viewrankai.com/tools/youtube-transcript/0ur-uowvaac --- [0:00] hi guys it's ben heath from lead guru and in this video i'm going to talk about facebook ads cost caps do you want to be using cost caps are they a good idea if you are going to use them how should you use them i see a lot of people making mistakes with cost caps adding them into their facebook ad campaigns when they shouldn't not using the right way and that can have a massive impact on your facebook ad results so i'm going to clear that up in this uh in this quick video before getting attached to very quickly ask you to smash that like button click that [0:23] thumbs up button that really helps me out and of course subscribe to my channel if you're new and haven't done so already i release facebook advertising great content all the time so lots of useful stuff for you to help you get better results with your facebook ad campaigns so i'm in an example facebook ad account here and i've got an example campaign created and i've just scrolled down to the um campaign budgetization section which is what we're usually using when we're running facebook ad campaigns we're using cbo and i've got a whole video about cbo versus i'll include that in the link in the video description below and so [0:53] you can check that out it's well worth doing if you're not sure on that sort of stuff but once you turn on cbo you'll see that you've got this campaign bid strategy section what we're talking about here is cost cap so you can see that the default is lowest cost and if i click on the little down arrow you can see we've got lowest cost as the default cost cap and then there's some other options like bitcap minimum row s in this case you may see other options depending on how your ad account is set up and what integrations you have so you might see highest value for [1:21] example as an option um and it also depends on your campaign objective we've created a conversions campaign here because again 90 of the campaigns we create are usually going to be conversion campaigns so don't worry if you don't see the exact same list it's basically what i'm getting at but the purpose of this video is i'm going to talk about cost cap i'm going to talk about it in relation to lowest cost which is the default now lowest cost the idea behind lowest cost and the reason why it's the default option with your facebook ad campaigns is to get the most results for your budget which sounds [1:46] fantastic that sounds exactly like what most advertisers would want however once you run facebook ad campaigns for any length of time you'll realize that results can fluctuate significantly and they do this for all sorts of reasons again i'll include another link in the video description below to another video all about why results fluctuate and what happens there but basically it's because we're advertising in the real world to real people and their behavior on the platform is affected by real world events like news like how good the weather is what time of year it is all this sort of stuff right so there's often fluctuations and that can lead to spikes in advertising [2:23] cost um and usually does and so what people will often do is they'll go you know what my campaigns are usually profitable but whenever we see these spikes in cost they just become unprofitable i don't want to run campaigns i want to limit spend and that's when people go in and they produce and they add in a cost cap so you can see cost cap says here control your costs whilst getting the most volume of results for your budget and what the idea behind if i go ahead and add it in what the idea behind cost caps is is that it will take out those spikes [2:52] okay which sounds fantastic so you say look i don't want to spend more than 20 cost per purchase and let's say your campaign averages you know 16 cost per purchase but every you know a couple of weeks for a few days it will spike up to 24 dollars cost per purchase or so and you would just rather not advertise when uh when that happens now i am not completely anti-cost caps but there's absolutely some times where you do not want to be using cost caps i want to make that very clear the first is when you've got a new campaign and you don't know what your average cost [3:24] per conversion or even cost per result is likely to be cost caps absolutely get in the way of facebook's optimization process when your campaigns are new when your ad sets are new and they're going through the learning phase you are going to see fluctuations in results you do not want to have cost caps in place there firstly because you have no idea what to set your cost cap at you don't know what your cost cap what your cost per conversion is likely to be you could sell it way too low and your campaign simply won't run but even if you do get the right amount you're going to spend much longer in the [3:55] learning phase you're much more likely to get stuck in learning limited which is something you want to avoid if you can and that's because facebook kind of can't do its thing it can't test lots of different options because it keeps running up against this restriction so during the first at least week but usually longer than that i do not like to add in any cost caps to a facebook ad campaign i also don't like to do it if you're launching if you've been running a campaign for a while but let's say you're going to add something in new like you're adding in a new product to [4:24] your campaign that's advertising a certain product range or you're adding in something new like targeting options or significantly different ad creative because again we want the facebook ad machine learning process to be able to optimize whilst under the new conditions like let's say you add in a new target you create a new ad set right you added a new targeting option um well we want to see how that does that's going to that ad set is going to go through the learning phase if you've got a cost cap in place that's going to get in the way cost caps are much more useful for mature campaigns where you [4:57] have quite a lot of data you know what your average cost per conversion is and you know that just at some times of the year or during certain days of the week even perhaps or things like that your cost per conversion or cost per result goes above what you want it to and if you could take that out you might take your overall cost per conversion from say 18 down to 16 15 by just not advertising on those days and that's absolutely fine and that's how cost caps work by the way and facebook will basically see okay you've set a cost cap for 20 cost per purchase we're getting above [5:30] we've just gone above that for the last few days let's turn the campaigns off it is not perfect by any means so often we will see cost caps turn off campaigns too late so you do end up spending too much money um above the limit that you've set and we see it doing it too early where your average cost per conversion is well below and cost caps have gotten in the way and turned off your campaigns when you think or you should still be running so that's also something to be to be aware of so those are scenarios in which i would and wouldn't use cost caps just want to [5:58] quickly jump to the ad set level now and if we scroll down we will go you can see all this stuff's loading scroll down we see we'll get to the cost control um level okay now the once you've worked out when you shouldn't shouldn't be using cost caps or cost controls what level should you set your cost cap at i see a lot of people let's say they've run a campaign for a month or two months they know that their average cost per purchase is 20 and they want to set this at say well let's do pounds because i've seen my ad accounts and pounds they want to set [6:33] their um cost cap at say 18. like they're averaging their rent account is 20 and they think oh i can use this cost cap to bring my average down to 18. if you do that your facebook ad campaign is highly likely to just simply not run or only spend a tiny fraction of your budget okay i would definitely not recommend you go lower than your average i wouldn't even recommend you go at your average i would usually give some nice headway often around about 20 so if your average was 20 or in this case 20 pounds i'd usually be starting to look in and put in a cost [7:09] cap at about 24 about 20 above now you can always adjust this and bring it down so i would encourage you to start higher than you'd like it to be and see how that affects things like let's say for example i added in a cross control here at 24 pounds and my campaigns ran just fine no effect okay then we'd look to bring it down to say 22 then maybe we bring it down to 20 and see the impact but if you go straight in at say 18 your campaigns may not run if you go in at 20 your campaigns are probably going to run only a part of the [7:37] time they may still not run i said cost caps do not operate perfectly but if you go in at the 24 and you see oh okay my campaigns are actually already being affected here and they are being turned off at certain points then you know you've probably got the right amount you may even want to increase it so go higher and incrementally reduce the idea here is not with cost caps it's not to spend as little as you possibly can it's to take those spikes out of cost cost caps can reduce your overall um average cost per conversion by taking out the spike not by bringing down what [8:09] your average would be that's that's just not gonna happen okay um so yeah so that's how i'd go about structuring it if you're introducing a new ad set because obviously if we're using cbo you've turned except you set up a cost cap at the um campaign level and then the ad set level you're introducing cost control if you're using cbo and want to introduce a new ad set we're testing a new targeting option i've already mentioned you don't really want a cost cap in place you can just go ahead and put this as something much higher okay we've done that quite often um and that will just basically allow [8:38] that ad set to run without an issue and then once you've got an average for that ad set you can then bring that cost back down to something that that is actually going to come into play then and be more appropriate okay so hopefully that's been useful hopefully that's helped cleared up some some cost cap questions when you shouldn't shouldn't use it and before we go a couple of things i want to quickly mention the first is a free webinar i've created called three killer facebook ad strategies to double or more your revenue and this webinar is all about facebook ad strategy we demonstrate three sales funnels three [9:04] that we use for our clients all the time very much tried and tested very much proven we've generated seven plus figures with each uh multiple times and we break down in the webinar not only exactly how these sales funnels work but which one you want to use depending on which products and services you offer because there's a difference there right you need to advertise a 20 product very differently to a 10 000 service um so i think strongly recommend going through this it's completely free links in the description below might be some of the best time you ever spend when it comes to facebook advertising to go through [9:35] this free webinar so i'd go ahead and check that out other thing i want to mention is my facebook ads mastermind group so free group there are currently 125 000 members one of the absolute biggest communities of facebook advertisers anywhere in the world and it's full of people just like you who want better results from facebook ads they're asking questions getting them answered i'm in there every day um it's just an amazing community that really helps you get much better at facebook advertising much faster learn from others all that sort of stuff so again completely free to join link is in the description below go ahead and join them we'd we'd love to [10:06] have you in there if you found this video useful please give it a thumbs up please remember to um subscribe if you haven't already and comment below i get to as many comments as i possibly can so pop comments down below let me know what you think and yeah best of luck with your facebook campaigns guys thanks bye for now --- About this transcript Read from YouTube's own caption track and laid out by ViewRank AI (https://viewrankai.com). 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