Facebook ads are not cheap but they can also be quite profitable, especially if you use proper marketing strategies. Facebook advertising costs for small businesses depend on several factors, including the size and industry of your business, how effective your ad campaign is, how many sales you generate from the ad, the total amount of revenue that your customers spend (or “return on ad spend” or ROAS), and how much you are spending on each conversion.

Understanding Facebook Ad Costs: Factors and Considerations

Facebook ad costs are based on an auction that takes into account various factors such as the audience you are targeting and the quality of your ad (including its relevance, estimated action rate, and previous feedback). The ad that has the highest value wins the placement. The higher your budget, the better your chances of winning ad placements and thus lower Facebook ad costs.

In addition to budget, ad costs can vary across times of the day. AdEspresso reports that Facebook ad prices are typically lower between midnight and 6 a.m. This is likely due to less competition for ad space during this time. Another factor that impacts Facebook ad costs is the choice of campaign objective. Choosing the wrong objective, such as reach instead of link clicks, can increase your ad costs because Facebook will not know how to best use your ad to achieve your goal.