How does Facebook ads work?

How does Facebook ads work?

Purchase type defines the payment and targeting method for the ad campaign. Facebook offers 3 purchasing types:

  1. Frequency and coverage.
  2. TRP.
  3. Auction.

Purchase type “Coverage and frequency”

The Reach and Frequency buying type allows advertisers to plan and buy a campaign in advance. Advertisements can be streamed to Facebook, Instagram and the Audience Network (for the Video Views purpose.) This type of ad is available to a limited number of advertisers. If you would like to be able to work with this purchasing type, you can contact Facebook support.

Features of working with the “Coverage and Frequency” purchasing type: Determine the exact budget that will be required to reach the right audience, giving you control over costs. Full control over the display of advertisements. With this type, you can accurately plan the reach and frequency of your campaigns. Even before launching a campaign, you will know when and how often your ads will be shown. Sequential display. Allows you to customize the order in which ads appear on the platform. Planning before buying. You can use the Campaign Planner tool to explore all the available options and plan your campaign. It will help you create and compare media plans. But this tool, like the buying type itself, is also only available to certain advertisers.

When is it worth choosing the “Reach and Frequency” purchasing type?

The “Reach and Frequency” purchase type is intended for advertisers who plan to:

  • reach an audience of more than 200,000 people;
  • refer to the whole country, and not to a separate region within it;
  • get a clearly predictable coverage of your advertising;
  • control how many times users will see ads;
  • plan and book advertising campaigns in advance;
  • TRP (Target Rating Point).

The concept of TRP (Target Rating Points) originally existed in television metrics. This is the name given to GRP (Gross Rating Points) statistics, calculated only for a specific target audience, in comparison with the entire possible audience.

Facebook introduced this metric to measure the performance of video ads.

Buying TRP allows advertisers who have already run TV campaigns to plan and buy video campaigns on Facebook and Instagram using Nielsen-validated target rankings.

Features of working with this type: TRP allows you to order advertising campaigns 6 months before they are shown. This purchasing type also allows you to purchase a specific number of campaign impressions to a target audience at a set price. These campaigns are paid for after Nielsen shows your ad to the target audience for which you have specified demographics.

You can only launch a campaign with this buying type by contacting a Facebook representative. It is important to consider the following things before ordering:

  • TRP goal;
  • The target audience;
  • Term;
  • Budget;
  • Frequency of impressions;
  • Platform: Facebook and Instagram.

Please note that if you run a TRP campaign, you will only be able to reach people in certain countries: USA, UK, France, Italy, Germany, Australia, Brazil, Canada, Malaysia, Indonesia, Philippines, Thailand and Mexico.

Auction and rate

Auction and rate

All advertisers have access to the purchasing type “Auction”. It provides more options, efficiency and flexibility, but results are less predictable. Using this type, you will be able to serve ads. The auction wins and displays the ad with the highest “total value”. The Total Value is not the amount that the advertiser is willing to pay to show the ad. To determine this indicator, the following factors are taken into account:

  • Approximate frequency of actions
  • Advertising quality and relevance

The rate is the number that reflects how much you are willing to spend. It is also your tool to control your price in case you win an auction. The rate is set by the Facebook algorithm. If you set a limit bid, you can control the price per optimization event. But if the bid is too low, then the number of impressions will decrease.The bid is set by the advertiser. This strategy will help you achieve an average cost per optimization event during ad impressions that is as close to your target price as possible. Approximate frequency of actions is an indicator that shows the likelihood of a user performing a targeted action: click, repost, download a mobile application, etc.