How Much Money Should I Spend On Facebook Ads?

“More means better.” When it comes to ads on Facebook, this phrase isn’t always true. If you’re new to Facebook Ads and want to run effective promotions, you don’t need to throw your entire marketing budget into the platform right away.

Instead, it’s essential to approach the question, “How much should I spend on advertising?” more strategically. You can test your campaigns and gain valuable insights with small budgets, while thousands of dollars spent may yield zero results. 

In this article, we’ll explain what it depends on, how to leverage algorithms, and how to align your ad spend with business goals so that every dollar works for you. 

Why Do You Need a Facebook Ads Spending Strategy?

To avoid wasting money. A clear strategy for platforms like Facebook ensures that every dollar you invest has a purpose. Here’s why it matters:

• Prevents overspending. It’s easy to lose track of costs when campaigns run 24/7. At the same time, when you have a plan, you definitely know how much you should spend.
  
• Maximizes return on investment (ROI). By tying budgets to business goals, you spend smarter, not just more.
  
• Sets realistic expectations. Knowing how much you’re ready to invest per conversion allows you to stop when things go wrong and avoid disappointment when results take time.
  
• Helps scaling. With a structured budget, you can grow ongoing Facebook campaigns step by step instead of guessing.

How To Know How Much I Need To Spend

First and foremost, you need to understand that there’s no universal number. Everything depends on the situation, and the benchmark can result from dozens of factors. The main ones to keep in mind are:

1. Your goals. Awareness campaigns usually need less, lead generation costs more, and direct sales often require the biggest spend.
2. Audience size. A larger target audience may require a bigger budget to drive engagement and make an impact.
3. Industry. Competition in the industry can significantly boost cost per acquisition and conversion. Interestingly, global industries such as finance or technology typically have higher ad costs than local services.
4. Timeframe. Short campaigns usually need a larger spend per day to collect enough data. At the same time, longer campaigns can stretch budgets gradually.

Now, we’ll break down the main steps to find out your ideal spending on effective Facebook ads.

Test Campaign

Before diving into big numbers, you can determine the average cost per action by running a test campaign. A smaller budget gives you room to experiment without risking too much. Try different ad creatives, placements, audience segments, and bidding strategies. Helpful tips:

1. Start with $20–$50 per day.
2. Let the campaign run 7–10 days to get reliable data after Facebook’s learning phase.
3. Track key metrics, such as CPC, CPM, CTR, and cost per conversion, to identify what works.
4. Keep one variable at a time. Don’t test multiple audiences, creatives, and placements simultaneously.
5. Scale gradually. After identifying successful combinations, consider gradually increasing the budget instead of immediately opting for higher spending.

Analyze your goals

A lower stage in the sales funnel means a higher cost per target action. Here’s why:

1. Awareness (top of the funnel). Usually, at this stage, people aim to make their brand or products seen by as many people as possible. The audience isn’t so specific, so impressions or clicks are relatively cheap.
2. Consideration (middle of the funnel). Your ad set may have an objective to push people to sign up, download, or add items to their cart. The value of the action is higher, so platforms charge more.
3. Conversion (bottom of the funnel). Ads aim for actual purchases or subscriptions. The audience is smaller but more likely to buy, so each action costs the most.

Access Target Audience and Geo

When you’re running an ad, the location of your audience directly influences the pricing. For the US and Western Europe, the CPA might be several times higher than for the same campaigns focused on Eastern Europe and Asia.

This is because audiences with higher incomes typically have a higher cost. Nevertheless, they can also bring high ROI.

Also, broader audiences usually come with lower costs than more narrow ones. However, clicks from a wide audience may be less qualified, which means that fewer people will take the desired action. Narrow, highly targeted audiences can cost more, but the people who do click are more likely to convert.

Compare Industry Costs

Competition in the industry directly influences the advertising budget. For instance:

• Finance, insurance, and SaaS. These are some of the most expensive due to high-value leads.
• Retail and e-commerce. Costs vary depending on product margins but are often mid-range.
• Health and fitness. These industries have moderate competition with good potential for engagement.
• Local services (restaurants, salons, repair). They are often cheaper but still require consistent spending for visibility.

According to recent benchmarks, the cost per click (CPC) and cost per thousand impressions (CPM) vary widely by sector. You can always find tables showing average costs per industry, which help you set realistic budgets. For a deeper dive into budgeting costs, you can read this article.

How Much Should I Spend On Facebook Ads?

Using Ads Manager makes it easier to monitor and adjust your budgets in real time. Yet, let’s break down spending levels more concretely so you have all the info in one place. 

Daily

Small businesses can start with $20–$30 per day for testing. As campaigns stabilize, you can scale spending to $50–$100 per day.

Weekly

If you prefer weekly budgeting, think in terms of $350–$700 per week for modest campaigns. This allows you to collect enough data without overspending.

Monthly

For longer-term planning, most small to medium businesses allocate $1,000–$3,000 per month to run multiple campaigns and test different audiences. Larger companies or enterprises may spend $10,000+ per month, depending on goals, competition, and industry.

How to Improve Facebook Ads Budgeting For Different Businesses

No matter the business size, there’s always a chance to improve your Instagram or Facebook ad performance. Nevertheless, in this case, the approach to budgeting and cost distribution will differ. Here are the most prominent tips for various companies. 

Small Business

• Focus on testing. You can always start with one or two campaigns to see which audience responds best.
• Prioritize high-impact goals like lead generation, local awareness, or low-cost conversions. You will be able to work on more complex strategies a bit later.
• Use retargeting to reach out to people who have already interacted with your brand.
• Monitor what ads are driving the most clicks, leads, and conversions. Check your Ads Manager regularly to stop low-performing promotions.

Medium

• Run a few campaigns with different objectives to cover all stages of the sales funnel.
• Divide your audience into segments and specify promotions to deliver more personalized messages.
• Try lookalike audiences based on your most loyal customers to optimize spending while reaching new relevant prospects.
• Test different ad formats (such as carousel, video, and Stories) to see what engages your audience most.

Enterprise

• Segment campaigns by product, region, and customer lifecycle stage for maximum precision.
• Test new creatives and ad formats to stay ahead of the competition. Analyze the results and pick only the ones that work best for you.
• Implement A/B testing continuously for headlines, visuals, and calls-to-action.
• Monitor frequency and ad fatigue.
• Use advanced targeting strategies like custom audiences, dynamic ads, and multi-country campaigns.

Finup cards can be another great choice for businesses of any size. They allow you to launch promotional campaigns quickly and without worrying about complex setup. Forget about spending limits, rejected transactions, or lack of flexibility. Assign roles and permissions to team members, control budgets for each campaign, and track spending and results in real time.

Key takeaways

It’s impossible to pick one clear number for how much money you need to spend on your promotional campaigns. However, there are clear tips and strategies that will let you avoid overspending. Analyze your current strategy in terms of goals, target audience, industry competition, timeframe, and previous results. Compare how much money you plan to spend with the average number based on the size of your business. Finally, keep testing and adjusting campaigns based on real data.

FAQ

How Much Should I Spend On a Facebook Ad Campaign Daily?

The daily spending may vary from $20-$30 daily for small businesses to $500+ per day for high-volume campaigns within big companies.

How Much Should Small Businesses Spend On Facebook Advertising?

For small businesses, it’s better to start from $20-$30 per day. While some experts may recommend lower spending and suggest that beginning from $5 may work, in reality, such a small budget may not be enough to gather enough data and identify which campaigns really work best.

What Industries Are the Most Demanding Regarding Budget for Facebook Ads?

Finance, insurance, legal services, technology, and real estate are considered the most demanding. Among the factors that influence such distribution are:

• Fierce competition
• High lifetime value
• High-value target audience
• High-cost and complex products and services