3 Ways to Outsmart Facebook’s Bidding Algorithm

3 Ways to Outsmart Facebook's Bidding Algorithm

Like it or not at the heart & soul of Facebook advertising is its real-time bidding algorithm. And Facebook’s bidding algorithm is extremely effective BUT it was built to prefer large advertisers.

In this article, I’m going to show you 3 weird tricks that will help outsmart Facebook’s bidding algorithm to convince it that you’re a large advertiser (even if you’re spending less than $10 / day) and to improve your overall Facebook campaign performance.

Trick #1: Match your bid type to your transaction volume

A mistake that a lot of newbies to Facebook advertising make is that they set up a campaign and bid to optimize on whatever their desired goal is, i.e. a checkout.

Unfortunately, a lot of new advertisers might not be able to provide Facebook’s bidding algorithm with enough data to truly optimize on that goal.

For example, if you only have 4 checkouts a day, Facebook will have a very difficult time determining who’s more likely to checkout in the future.

One thing that big advertisers do is they provide Facebook with a lot of data. A big eCommerce store could potentially have 100’s or even 1,000’s of checkouts a day & Facebook will be able to take that data and quickly optimize on it.

But if you’re a smaller store and you only have 4 checkouts a day, it might be advisable to optimize your bids on something earlier in the funnel, i.e. an add to cart, a product page visit, a lead, or even clicks if you’re on a small budget.

As a rule of thumb, Facebook recommends whatever you optimize your bids on should consistently have over 20 conversions / day — but I typically like to optimize on something with more than 30 conversions / day, remembering that the more data you give Facebook’s bidding algorithm, the lower its margin of error becomes.

Trick #2: Decrease your bids only if you really have to

Intuitively, a lot of advertisers try to cut their ad cost by bidding lower, but this is often a mistake.

When you lower your bid, you automatically drop below the normal population of Facebook advertisers who allow Facebook to determine their best price per click or conversion.

By doing this, Facebook will automatically limit your reach and will limit your delivery to people they’ve predetermined to be “buyers” or “clickers” on their network.

In fact, when decreasing your bid, you’ll often see your frequency go up. This is because Facebook is showing your ad to the same people over and over, even if they are unqualified buyers.

While I do recommend trying to decrease your bids if your CPA prices are too high, you might want to try tip #3 first because your delivery and results could be negatively affected when your bid drops below your competition level.

Trick #3: Increasing your bid can improve results

This might be the most counterintuitive tip yet, but it can make a huge difference in your campaigns and can actually reduce your cost per acquisition.

Due to the way Facebook real-time bidding works, you hardly ever end up paying as much as you bid — meaning if youbid $31 / lead, you might still get leads at less than $2.

I know that sounds crazy but I do it all of the time.

By bidding slightly higher than your competition level, you’ll give Facebook greater leeway to move its bids up and down to get you in front of the most qualified buyers.

And what’s even crazier is that a small increase can have a huge impact. By default, when optimizing on conversions & letting Facebook decide the best price for you, Facebook bids $30.

By slightly increasing the bid to $31 or $32, you can automatically jump over a large portion of your competition for the best, quality impressions.

Now, It’s Your Turn

Now since you know these 3 weird tricks to improve your Facebook advertising performance, it’s your turn to give it a try.

If you have any questions, feel free to leave a comment below or to contact me directly.