Facebook Auction Algorithm: What? Why? How?

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Sometimes for new client projects, when making miscalculations and launching targeted advertising, we encounter misunderstanding and questions from customers: “Why invest so much in the development of interesting advertisements, look for creative approaches?”. The answer to such questions lies in knowing the basic principles of how Facebook advertising campaigns work.

Алгоритм аукциона в Facebook

There is competition in both the offline advertising space and targeted social media advertising. In order not to fall into the online market chaos, Facebook introduced an auction algorithm. From the usual concept, the Facebook auction is distinguished by its multi-parametric system for evaluating an advertisement. The auction wins the advertisement that receives the highest total value.

The total value is formed on the basis of an assessment of three parameters:

  • rates;
  • approximate frequency of actions;
  • quality and relevance of advertising.

Bid. As soon as the advertising campaign is set up and launched, the bid comes into effect. There are two types of bids on Facebook: automatic and manual.

If you choose automatic bidding, then the Facebook algorithm itself assigns a bid based on the goal of showing the ad the maximum number of times within the set budget. It makes sense to include this type of rate at the initial stage of the advertising campaign. This is done for the purpose of preliminary analysis and participation of the ad in the first few auctions.

Non-automatic bid. You can set the bet size yourself. You determine within the targeting settings what the highest amount you are willing to pay.

Important rules for the “manual bet” format. 1. Don’t bet too big. To win the auction, the average amount within a particular auction will be debited. 2. Strong savings on the size of the bid leads to a loss in the auction.

Approximate frequency of activities. This parameter takes into account the likelihood that users will perform the desired target action – download the application, go to the site page, like and repost. The Facebook algorithm will show the ad to those who are interested in a particular product.

The quality and relevance of advertising. Negative reviews, low interest or vice versa, positive interaction with the ad are all important in determining the “Total Value” metric.

In conclusion, a couple of important tips:

  • Carefully work out the quality of text and visual material for an advertising campaign. If you do not find a special approach to your target audience, then the price for this is an increase in the advertising budget and a decrease in the effectiveness of the target.
  • Don’t be greedy and don’t rush. Do not install more than one advertising campaign with identical settings within one advertising account. Such campaigns will compete with each other, and this will lead to a “drain” of the budget.

If you want to test images and texts, we recommend testing several ad groups with different teasers and content in one advertising campaign.

Author: Nadezhda Zubreva, Internet marketer at MAVR