What Facebook Ads is all about?

FB advertising cost in Malaysia 2020 guide

Facebook was initially established to target a college audience, but the platform’s user base now begins at the minimum age of 13 and extends to all other generations of different ages. Back then the least popular group would those who are over 65 years old, but we can see the demographic users have gradually changed. For example in Malaysia, we have seen a lot of older people start to get active on social media, especially Facebook.

Because of the massive number of users that Facebook attracts, and its ability to keep them interested for long periods of time as they browse through profiles and sites, it is fair for advertisers to be able to make full use of the site. This is where social media marketing comes in place. It has developed approaches, such as Facebook Advertisement, Google Search Marketing and SEO, are now challenging to bring active users into a company.

Facebook has been selling ads in different ways from as far back as 2004, but its initial ad units were far from the sophisticated tools that can help today’s marketers. Now many things have changed for a convenient digital marketing strategy for Facebook.

There are more than 8 million users in Malaysia using Facebook and it stores users’ information according to targets. Now you can advertise your service or product online through Facebook by targetting audience based on their area, age group, birthday, employment, workplace keywords, sex, interests and languages.

How much do Facebook Ads cost in 2020?

This is a tricky question often asked by many social media marketer. Facebook ad pricing can be as much as around RM50 per button, or as little as RM5, depending on your situation.

A look at current studies shows that for most sectors in 2020, a Facebook estimated ad cost is between RM2.50 and RM9 per click. However, keep in mind that the cost may differ according to the industry.

For example, the finance and insurance industries can take up an average cost up to RM17 per click. Cheapest advertising cost is for industries like travel and hospitality (RM3/click), apparel (RM2/click), retail (RM1/click).

In general, social media marketing begins at about RM1,500 per month, on average. That cost depends on the length of service and services you opt for. The cost also has the possibility to go up to RM30,000 per month charged by a digital marketing agency.

(i) How much should you spend on Facebook ads?

For a startup, you can allocate at least around RM300 for the first month. On the second month onwards, you can start spending more than RM500 for specific lead generation strategies.

(ii) How much does a digital agency would charge you?

Be reminded that if you hire a digital marketing agency, the cost could be higher for at least RM1,200 per month for a single project. The cost typically includes the monthly reports, paid advertising, image creation and social media post creation.

How do Facebook Ads system work?

An ad generated by a Facebook company serving a Facebook audience based on user behaviour, demographic and profile details, app usage details, and users activities when they are off Facebook.

Every advertiser is different, which is why it is important to consider the goal of your ads as well as the aim you want to accomplish with a particular campaign. Marketers and businesses must ensure that they demonstrate the right ads, target the right people at the right time.

Below are the basic components resulting to a Facebook ad:

● Creative: What image and text are you going to use for the ad?
● Target: Who are you targetting?
● Placement: Where do you want the ad to appear?
● Bid: How much are you willing to pay to get people to see your ad and do an action?
● Budget: How much do you want to spend?
● Schedule: How long do you want the ad to run?

Facebook actually limits the number of ads to appear on every user’s Facebook account. This is because if there are too many ads appear on their timeline, then it is likely that users will use the app more often.

Therefore, Facebook Ads now work on an auction. You have to compete to get the available spaces to advertise your business through Facebook ad. Advertisers must bid against one another to secure their own advertising placement; the highest wins, but on a different circumstance, it can lose (read more below).

7 Things to Determine Facebook Ads Cost

Since the cost you can spend on Facebook Ads is still quite uncertain and changeable, there are a few possible ways on how you can determine the expected cost.

According to the studies conducted by Adepresso, Malaysia has an average CPC of USD0.18 (RM0.80). You can set your benchmark starting with this cost for your Facebook ads.

Despite this estimation, there are still other factors that could affect your budgets in ads. Truth to be told, all Facebook ads that you on your timeline all go into a bidding war among other competitors who also want to advertise their products.

Here are the 7 things you can use to determine Facebook Ads cost:

1. What you bid is important

There are basically two types of bidding: automatic and manual. For a starter, it is best for you to go for automatic, whilst the experienced one can go for the manual option.

2. The relevant score for your ads

The relevance of your ads will be measured by a score. This directly will give an impact to your cost and if Facebook is going to prioritise your ad request. With a high relevance score, your cost will be lower and Facebook will prioritise the delivery of your ad.

3. Estimated action rates

When the Facebook algorithm assumes that more action will be taken on your ad, then your ad will have a better chance of winning the bid.

4. Who is your target audience

Your target and the number of your target audience play a major part to determine the cost for your ad. This is because there will be more competitors or marketers who target the same audience. If this happens, the most expensive your ad cost will be.

5. The period you want to advertise

During peak season, you can expect a lot of marketers will advertise their products. This means that the cost is going to be more expensive. You have to be mindful of the festive season like Hari Raya Aidilfitri, Chinese New Year, Deepavali, Christmas, New Year’s Day and more. If you are planning to post your ads during these seasons, the cost will be higher.

6. Where your ads should appear

There are several options given by Facebook on where you want your ads to appear:

● Facebook newsfeed on desktop
● Facebook newsfeed on mobile
● Facebook right column on desktop
● Messenger
● Instagram’s newsfeed on mobile
● Audience network

The target audience you choose is the same for your Instagram.

7. Optimization for Ad Delivery

To start creating your ad, under “Budget & Schedule” and if you click “Show Advanced Options,” an option called “Optimization for Ad Delivery” will appear. It’s like you are informing Facebook’s algorithms what are your predicted outcomes and who will see your ads.

There are other options for Facebook ad delivery optimization depending on the target you select for the specific ads.

You should constantly keep your Facebook ads optimised so that your goals can be achieved. Be creative, learn new strategies and continue to improve on your ads. Analyse the report for every ad you published and calculate the efficiency based on ROI.