The world’s powerhouse social network rolled out a variety of updates in 2018, including more interactive ad formats, limitations for advertisers using third-party data integrations (the sunsetting of Partner Categories) and additional changes to improve user experience and tighten up scrutinized privacy policies. In addition to targeting and placement developments, Facebook introduced a new optional strategy for budget structuring – now known as campaign budget optimization. Starting September 2019, “CBO” will be a default setting, meaning clients and advertisers are no longer able to control or set budgets on the ad-set level. All budgets will now be set and updated at the campaign level, giving the platform control to optimize across ad sets based on the selected performance objective.
How Does Campaign Budget Optimization Work?
For some advertisers, the CBO default is a positive – encouraging the fluidity of budget to optimize between ad sets, which are typically segmented due to differences in targeting parameters. The CBO distribution is comparable to the way an ad set’s budget can be disbursed across the multiple ads within it, optimizing for top-performing ads.
However, assigning budgets by ad set currently grants advertisers additional control when setting up campaign objectives, allowing the platform to optimize efficiently to important, external business objectives. For example, if a campaign has a traffic objective and targeting is split between ad set A and B (ad set A historically drives more clicks but ad set B’s drives more conversions with a longer LTV), you may want to spend more on ad set B for quality of traffic. However, campaign budget optimization does not allow advertisers to dictate ad-set spend, so budget would shift away from ad set B because the campaign is working towards its primary traffic objective set within the Facebook platform.
The Future of Campaign Budget Optimization
While CBO may seem concerning for managing budgets, advertisers are still able to adjust minimum and maximum spend levels on the ad-set level, although overall budget allocation will be controlled by campaign. Facebook claims that campaign budget optimization will offer more efficiency to maximize results and is encouraging advertisers to leverage campaign-level metrics rather than focusing on the value of individual ad sets. While some advertisers are resistant, CBO’s ad-set-to-campaign budget change will be active September 2019 with Facebook’s reassurance of boosted performance and efficient ad delivery.