Facebook Advertising 101: Understanding the Cost of a Conversion

What Facebook Charges you for the conversion (your Bid) = Budget x Estimated Action Rate x Advertiser Score

When you raise your budget on Facebook, it is to be expected that you will get less efficient with your CPA. This is a given, which is why, when we want to scale results, we have to understand how the platform works and how to become more efficient to provide us with a profitable scaling margin.

When we are asking the machine to work harder and reach new people, the quality of those people and the maturity of their customer journeys will inherently be less. We cannot reasonably expect more people who we’ve talked to less, to behave as good or better than those relationships that we’ve already curated.

Scaling an ad account has very little to do with the increasing spend, it’s about getting more for the money that you do spend, and then getting so much that you have to spend more because of the untapped potential.

If you want more, making the work you do better is always going to be a more sustainable solution than making it worse… by asking the machine to do more work for you. That’s just simple math.

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