CBO vs ABO? Facebook Campaign Budget Optimization or Ad Set Budget Optimization?

0:00hi guys it's ben heath from lead guru and in this video i'm going to talk about facebook campaign budget optimization and compare it to ad set budget optimization what's commonly referred to as cbo versus ab i'm going to talk about the pros and cons of each which budget optimization strategy you want to use and which one at the end of the day is going to get you the best possible facebook ad results this is a question i get asked all the time i thought it would be useful to create a whole video on the cbo versus debate now before i get in touch want to very

0:26quickly talk about something that i usually wait to the end of the video to talk about because of that i'm aware that a lot of people that watch my content aren't actually aware of this and that's that my company lead guru offers done for you facebook and instagram advertising services so we are an agency we work with clients we create manage and optimize facebook and instagram ad campaigns and if that sounds like something you might be interested in you can book a free call with one of my team members there's a link in the video description below just a 30 minute call no obligation we do ask

0:51that you have at least a 3k per month minimum budget that's the minimum requirements to work with us but if you're interested in having a professional agency manage your campaigns take your results to another level we can certainly help with that so go ahead and book that call if you're interested now with that out the way let's go ahead down there and get into the topic of this video which is campaign budget optimization versus ad set optimization which ones you want to use which one produces the best results so i'm in an example facebook ad account and we're going to create an example campaign to demonstrate campaign budget optimization

1:20ad set budget authorization and all that sort of stuff so if i come in here and click on i'm an ads manager by the way in case you're unfamiliar with this view i click on the green plus create button and we'll go with the conversions campaign because that's what we're creating the vast majority of the time now what i'm going to do is i'm going to first jump to ad set budget position because that's facebook's default so if i go to the ad set level here and we can see that there's a budget section and we set the budget at the ad set level as you can see just here and what

1:45that means is facebook is going to spend that much in this case 20 pounds per day on this ad set and they're going to spend across the different ads according to performance so let's let's demonstrate that because it'll be a little bit more straightforward there's only one ad in there at the moment and that could be a little bit confusing but let's go ahead and add in um a couple different we'll have three ads in this ad set which is somewhat typical we would often have something like that in our ad set okay let's minimize this down so now this one ad set okay has three different

2:16ads in it um and we could go with new conversion add one um and just to make this i think when you demonstrate things visually it makes it easier to understand doesn't it new conversion and two and let's call this new conversion add three so on our 20 pounds per day with ad set budget optimization facebook is going to allocate budget according to the best performing ads the ones that get us the lowest cost per conversion um that might mean that ninety percent of the budget goes to add one eight percent of the budget goes to add two two percent budget goes to add three it could be they all get about third or

2:52third third all sorts of splits okay um depending on and performance so that's what ad set budgetation means now if we jump to the campaign level and if i click into edit and scroll down to the bottom you will see that there's a section down here called campaign budget organization which is turned off by default we'll explain more about that in a minute because i think that's very interesting now if we turn it on what will happen is that instead of budget being set at each individual ad set and that budget being spent in each individual ad set we now consolidate the budget and we're saying to facebook not only do i want

3:27you to allocate budget across ads according to performance i also want you to allocate budget across ad sets according to performance so once again if we minimize this down we've only got the one ad set in here right now but if we call this new conversion ad set one and then if we were to go ahead and duplicate this and again let's create a couple of extra copies have three of each we would typically have say three to five different ad sets um in one campaign and then say three or four different ads live at any one time so let's give that call that new conversion ad set two

4:05and we'll call this one new conversion ad set three okay so much in the same way where the adset budget is allocated according to performance across the ads now at the campaign level we're allocating budget across the ad sets as well so let's say for example in these three different ad sets we were testing different targeting options some targeting options going to perform better than others some are going to perform worse great facebook's going to work that out and spend more money on our best performing um assets so campaign budget optimization was something that was introduced later on as i said it always used to be if i

4:42scroll back down to that section it always used to be ad set budget optimization for years and years and years and then facebook introduced cbo i don't know must have been three years ago or so now and the advantages of allocating budget across ad sets according to performance seem fairly straightforward firstly you're going to end up with better overall facebook advertising results because if more money is spent on your best performing elements your average total cost per conversion um is going to be better or cost per you know it's going to be cost per result so that could be a traffic campaign video view campaign etc etc

5:18and facebook quickly realized this when they first introduced campaign budget optimization and then they started making campaign budget optimization not long after they introduced it the default option then they started saying that campaign budget optimization was going to become the only option and then they seemed to have backtracked since then this that must have been two years ago they said it was going to become the only option any day now it never did and then not only did not do that but facebook went back and defaulted to the ad set budget i don't think they did that strictly for performance reasons i think they did that because of advertiser

5:51pressure there were tons of advertisers that were very used to using ad set budget optimization particularly professionals have been doing it for years and years and they didn't want that functionality to go away and i agree the functionality shouldn't have disappeared um but i think it's interesting that campaign budget opposition is not the default when and this is the first sort of big part of the video in general for most facebook advertisers campaign budget optimization is going to be the best option so you do lose some flexibility in terms of being able to allocate exactly a certain amount of budget to each ad set and there are times when you want to do

6:27that and i'm going to explain more about that in a minute but the advantages of campaign budget optimization are real and for most advertisers what they want to go with okay a few reasons firstly you're going to get a lower cost per result on average a lower cost per conversion and you're going to do that because more money is going to be spent on your best forming elements secondly with campaign budget optimization you don't really have to worry about audience overlap between your different ad sets why because the budget is centralized and with that facebook's delivery mechanisms are smart enough to work out okay there's significant overlap between

7:03these audiences let's not bombard people whereas when the budgets are separate facebook has less control over who may be seeing ads a whole bunch of times in different ad sets okay so something to be aware of when you're running adsense optimization is audience overlap can become more of an issue with cbo you negate that fantastic the second well i suppose a third um major advantage of campaign budget optimization is the ability to have one sort of master campaign that has both cold audience assets and warm audience ad sets in it um you can do this obviously with that set by your opposition but what i love

7:42about cbo is that it's the budget is adjusted dynamically so let's say you've got four different ad sets or in fact let's go back to our example of three different assets let's minimize this down okay let's go back to alexander's through some ad sets so let's say that ad set two and ad set three are called audiences so interest targeting perhaps a look-alike and then ad set one is warm audiences people like our website visitors people on our email list that sort of thing warm audiences are typically much smaller but typically very very effective so you absolutely want to make sure that you're spending as much as you

8:12possibly can on your warm audiences without burning them out and fatiguing them and results just dropping off because they've all seen your ads a whole ton okay with cbo that happens automatically you'll see when you turn on cbo campaign a good chunk of the budget is initially put into warm audiences and then it reaches a stable level without cbo if you're setting the budget manually for your warm audiences it's so easy to overspend it's so easy to fatigue that audience and burn it out also warm audiences change over time so you might start running your facebook ad campaign with a thousand website visitors over the last 30 days but if

8:46you scale your campaigns you do more advertising your brand grows that might reach a hundred thousand visitors over the last 30 days well having to with you would have to manually try and track the budget as that audience size changes obviously you could spend a lot more the larger that audience becomes with cbo again that's going to happen more and more automatically so you may find that a higher percentage of your budget in a cbo campaign ends up being spent on your warm audiences dynamically automatically over time as those warm audiences grow again a fantastic thing to be able to to have and to take advantage of so those

9:20are the major advantages of cbo and i think if you're using a direct to office strategy where you're directly advertising your products and services like a lot of facebook advertisers are cbo for the vast majority of people is going to be the right way to go so with that said let's um let's go ahead and jump into an ad set and then let's go to the to the budget level and talk about and talk about some of the advantages so with ad set budget optimization the major advantage is you have more control and that's what a lot of facebook advertising features and debates are it's the advertiser having more control

9:52versus facebook themselves having more control now as facebook has gotten better and improved as an advertising platform often giving facebook more control gets you better results so things like broader targeting has definitely become more and more of a thing over over the last few years as facebook's machine learning process has improved but there are times where we'll use outside budget optimization if for example we're targeting different countries using different ad sets in one campaign well there's often times where um you know we're working with a client and they're like look we need to spend this amount in this country this amount in this country this is a budget coming

10:26from up high we'd have a choice in which case fine if we're wanting to allocate you know you might have different product ranges in different assets there are all sorts of reasons why you might be really strict about allocating um budget in certain ways in which case ad set budget optimization is great what we will very rarely use adset budget optimization for is testing it's one of the things that people often do is they'll go oh i can't use cbo because i want to test two different targeting options you could do that in cbo it may be that facebook doesn't give much budget to one of the ad sets one of the targeting

10:59options but that's in my opinion nothing to worry about you can if facebook has allocated far more budget to one ad set there's a reason why they've done that that's almost certainly going to be the best option for you to go with um you've got your answer you don't need to effectively waste more money on the worst performing option by enforcing more of an accurate say a split test that's going to be more statistically significant so we rarely do it for testing we do it to have more control there are also scenarios where we will do it depending on the strategy being used so i said if we're using a

11:30direct offer strategy or let's say elite magnet strategy where we're looking to build an email list first we're always certainly going to use cbo if we're using something like an omnipresence content strategy then we want real flexibility and real control over exactly how much is spent on each ad set therefore we're going to use ad set budget optimization um if you're not familiar by the way with what omnipresence content is with various different facebook advertising strategies you might be watching sync in i just advertise my stuff there are other strategies um i'd strongly recommend you check out my facebook ads insider score so i'll include a link in

12:03the video description below it's like the most comprehensive facebook advertising course you can imagine almost 100 videos it covers absolutely everything you need to get fantastic results with facebook advertising and in that we actually teach six different strategies those are the three basic ones by the way director offer lead magnet webinar and only person's content the three basic ones we have three advanced strategies and the advanced stuff a lot of that uses ad set budget optimization because it's more advanced we want more control we want to manipulate things but i think for the majority of facebook advertisers particularly people who are fairly new to this space and definitely beginners

12:36you want to go ahead and turn on campaign budget optimization you want to give facebook more control if you're using direct to offer an opt-in first lead magnet style strategy that that sort of sales funnel is cbo more advanced stuff like omnipresence content and then some of the other advanced stuff that you would find out about in in facebook ad insiders um then um you may want to use adset budget optimization but hopefully that has cleared up that question like a lot of facebook advertising um options and settings it's not a this one's always the best or this one's always the worst it's this is best for this scenario for your

13:15business for your sales funnel for your strategy or this one is depending on your circumstances i would say the majority of facebook advertisers are going to be using simpler sales funnels and strategies that are going to want to use campaign budget optimization but not all and some of the advanced facebook advertisers certainly aren't okay so if that's useful before you go a couple things that you want to quickly reiterate the first our facebook advertising services already mentioned the beginning of the video if you're interested give us a call the second is facebook ad deciders my super comprehensive facebook advertising course covers everything you'd want to know facebook and instagram ad

13:50campaign wise from setup strategy ad creation optimization and testing scaling i i'm updating it all the time i'm adding in new videos and updating old videos every single month there's an ios 14 specific module anyway you can find out a lot more information on the sales page just click the link in the description go through there and then yeah hopefully you'll hop on in we've had hundreds and hundreds of people purchase the course already and feedback's been fantastic um hopefully it's been useful if it has please smash a like on this video please comment below to let me know uh comment below if you've got questions i always

14:20get questions whenever i talk about budget optimization strategies so i'm sure you'll have a whole bunch go ahead and pop them down below and um yeah subscribe if you're new i release facebook and instagram advertising related content multiple times per week if that's what you're into go ahead and subscribe and i'll talk to you soon thanks up guys bye for now