Posted on

How to determine Facebook Advertising Budget by Country

Facebook Ad Cost countries

Marketers are divided right into 3 sectors when it involves Country Facebook ad spending:

  • Worldwide: Target everyone in the world one very same ad set
  • Segmentation: Having different ad set for each country
  • Country Clustering: Having primary countries in same ad set

 

These are the main strategies although they are some variations to it.

There are added variations as well as areas of grey, but these are the main strategies. Whether targeting Worldwide Audience or by individual countries will much depends on the nature of the advertisement and your preferred target audience. E.g. If one is hosting an event in a country, its obvious that one will target first by that specific country. However, if one is targeting problem like “weight loss”, this is likely to be a Worldwide issue, also subject to nature of the advertisement.

At the same time, the same advertisement targeting different country will have different average cost per click (CPC), be it for engagement, leads or cost per like.

 

Average Cost per Click by Country

Facebook Ad Cost countries

 

Why Biggest Budget doesn’t always Win?

Its essential to understand how Facebook decide which ads to show its users. According to Facebook “They try to balance two things”

  1. Creating Value for advertisers by reaching and getting results from people in their target audience group.
  2. Provide positive experiences for Facebook users

In Short, the ultimate winner is the one that create advertisement with the most value to the audience.

 

Why Different Ad Spend by Nation?

There are 3 main factors that account to the ad expenditure by country.

  1. Interest: ¬†Reach those who are likely to purchase. Local business likely to target local audience. However, if you are running global business, you should also limit your reach by countries. I have personally tried and often i got high engagement in some countries but not a sale. Even if there’s a sale, the ratio is too insignificant compared to the cost that you are likely to spend.Often, it will be more justifiable to create one ad set by specific country to justify advertising cost.
  2. Distribution Control: Determine how much you get from each country will be a good starting point to justify how much you should spend on that specific country / ad group
  3. Similar Audience Optimization: Facebook aims to reach audience that seems likely to perform the action that you desired your audience to perform. Facebook group audience of similar interest together and also by location for optimisation. Location targeting is ideal for local business.

 

Issues with Optimization

Facebook primary goal is to get the most actions for your desired actions, be it for click, conversion, leads or like. Although as a marketer traffic is important, however traffic may or may not lead to sale. Traffic with target audience have a higher probability of sales conversion.

Driving traffic to your blog or squeeze page make get user to leave their email address for free gift like e-book etc. Although email list may lead to revenue, however email by themselves does not constitute a sale.

Some countries are cheaper to reach especially in third world countries as compared to developed countries. However, reaching out on Facebook with low cost with high conversion with email lead magnet does not constitute to a sale, even though Facebook primary goals is to get “desired actions” at lowest cost. This can be obvious when you target worldwide and selling higher ticket items.

You will definitely get high conversion, engagement and clicks especially from third world cheaply and give your your “results”. However, that may not lead to much.

 

Which Countries should you target then?

Often the more developed countries like United States, Australia, Canada, United Kingdom are more favourable when it comes to running ads based on revenue conversion. Third world countries like Cambodia, Philippines and India etc can get lots of traffic as its cheaper to reach users in those countries.

If you run Facebook ads campaign that include developed and third world countries, you will find majority of the leads come from those third world countries. It will be ideal if you simply wants likes or interaction, but you definitely get an issue when it comes to revenue.

 

My Recommendation

If running a global business, I would separate ad set by countries that are more likely to convert (maybe like those developed countries), follow by developing countries and lastly by third world countries in the budget allocation like 60% – 30% – 10% respectively.

On the other hand, another good way to stress is to create individual advertisement set, target by individual countries that are more likely to convert so you know where to allocate more budget, in line with the return revenue.