Many business owners have heard Facebook ads is a great channel to generate leads but may wonder…
- How much money should I spend on Facebook ads to get good results?
- Is Facebook Ads expensive?
- What is a good Facebook Ads budget?
With the right Facebook ads budget strategy you can generate as many leads as you like (on-demand).
Before you start spending a penny on Facebook ads, you need the right strategy. So before you read the rest of this article, make sure you sign up for my free online masterclass training to learn the exact strategy you need to generate leads and sales appointments in your business predictably each month… in a way that is automated, profitable and scalable.
Have you signed up for the free masterclass training? Yes..? Ok, great. Now keep reading to learn more about the best Facebook ads pricing strategy for your business.
The Best Facebook Ads Pricing Strategy
A BIG mistake people make with Facebook ads is they spend money just “boosting” Facebook posts to get more brand awareness, spend too little (to not get enough data for what works and what doesn’t) or over spend (spending money on Facebook continuously on stuff that doesn’t bring in any results). So, what do you need to do instead?
Here’s what I recommend you do…
Step 1: Start with a testing Facebook ads budget
In my lead generation online course, I teach business owners how to generate leads on Facebook Ads by first of all having a “testing budget”.
What is a Facebook ads testing budget?
You start off by creating at least 10-20 Facebook Ad sets with a budget of $20/day and spend $1,000 in total and let the ads run for 4-7 days. In each ad set test a different audience related to your potential clients. And in each ad, have some free content that explains how you can help solve a big problem that your potential clients have.
From this testing budget, you can see which of the Facebook ads sets generate the most leads at the lowest cost.
Step 2: Focus your budget on the best performing Facebook ads
After spending $1,000 in your testing budget, you’ll most likely have 1-3 really good ad sets that generate leads for only $20/day.
Then, depending on how many leads you want to generate each month, you can decide how much of a Facebook ads budget you would like to spend.
For example, if from your testing budget you generate leads at $15 per lead and you want to generate 10 leads a month you can pay Facebook $150/month. Or, if you want to generate 100 leads each month, you would pay Facebook $1,500. Basically, you are in control of exactly how many leads you generate each month.
What if you don’t have more than $1,000 to spend on Facebook ads?
Then Facebook ads probably isn’t a good fit for you at this time. So I recommend using LinkedIn Lead Generation (or other organic lead generation strategies) instead… and then scale up with Facebook once you have more clients.
On LinkedIn you can generate anywhere from 5-30 predictable sales appointments each month without having to spend a penny on advertising. This is a great place to start. Then, when you’re winning clients on LinkedIn, you can re-invest some of your profits into scaling up with Facebook ads.
If you’d like to learn how to use LinkedIn to get 5-30 predictable sales appointments each month without spending a penny on paid advertising then I recommend you watch my free masterclass training here where I go into this in more detail.
See also: How much should your business spend on Facebook Ads in 2020? (video below)
Step 3: Work out your Return on Investment (ROI) with Facebook ads
Generating leads from Facebook ads does not mean you generate clients. So keep that in mind!
You need to work out how many leads do you need to generate each month to win a new client and then how much is this client worth for you.
If for example, for every 50 leads you generate, you get 5 appointments and 1 client (and that 1 client is worth $5,000), you know you (roughly) how much you should spend to generate those 50 leads in the first place.
What should you spend your Facebook budget on?
When you’re creating a Facebook paid advertising campaign you’ll see lots of different ways you can spend your money. You can increase your traffic, video views, engagement and leads.
My recommendation is to focus on what will bring you the best results.
In most cases, that is more leads.
So in your Facebook campaign, choose “Lead Generation” or “Conversions” as your campaign goal.
Then, focus on creating an offer where you give away a highly valuable free piece of content, in return for your potential clients contact details (such as their name and email) to generate leads.
Step 4: Measure your results
If this is your first time running Facebook ads, then don’t expect perfect results. It will take some time to measure what works and what doesn’t and it takes a little bit more time to test your offer so that you get the most amount of leads by spending the least amount of money.
One of the most important numbers to look at is your cost per lead and cost per acquisition (in other words, how much does it cost to acquire a client)
You want to try to get this as low as possible and a good ROI on what you’re spending.
And the lower your cost per lead, the more leads you can generate (without paying more money).
Step 5: How can you improve your cost per lead?
There are many variables but it’s mainly to do with your competition, your message and who your targeting.
In particular, if your message (your free piece of content) is going to be highly relevant to your target audience, Facebook will notice your good results and will reward with a higher “relevance score” which in turn reduces your cost per lead and your advertising costs.
It’s a good idea to keep a small percentage of your Facebook ads budget (such as 10-40%) towards testing new Facebook ad ideas to see if you can improve your Facebook ads cost per lead and ROI.
Step 6: Scale up once you get good results
By testing different offers, target audiences, images, text, etc in your adverts, you can see what one’s perform better and get you a lower cost per click.
Once you’ve tested it to a reasonable level (where you’re getting a good amount of leads that you’re happy with and you’re happy with how much you’re paying per lead) then you can scale up and spend more (if you want to get even more results).
Think about what happens after you generate leads
Generating leads is the first part of a successful social media strategy, but the second part, which is lead conversion is also very important.
Once you start generating leads on Facebook, make sure you also have a plan for converting these leads into paying clients.
You can do this through email marketing, content marketing, live events, webinars, and so on.
If you need any help with running your Facebook ads (through training or our done-for-you services) you can I recommend you watch this short video for to get more help.