What Does Good Budget Planning for Meta Ads Look Like?
Updated: 5 days ago
Table of Contents
What Types of Budget Allocation Are There in Meta Ads?
You always tell Meta how much money you want to spend. That is your media budget, also called ad spend. You keep full control over your ad spending at all times.
Basically, you have two budget types available: the daily budget and the lifetime budget.
Daily Budget
With the daily budget, you define how much should be spent per day on average. On individual days, Meta may spend up to 75% more, but never more than seven times your daily budget in a calendar week. This budget type is particularly suitable for permanently running campaigns and offers high flexibility for adjustments.
Lifetime Budget
With the lifetime budget, you define a fixed total amount for a specific period. Meta automatically distributes this budget across the best-performing days within the runtime. This option is ideal for time-limited promotions such as discounts, launches, or events.
Small addition: Nowadays it’s actually no longer accurate to speak of full control. Over the runtime of your campaign, you do have it, but Meta has made its budget pacing more and more flexible, so on some days within your campaign you may spend significantly more budget than on others. In the end, as I said, you always land on the budget, but if you stop the campaign early, you may have spent more than you wanted.
Setting the Budget in Ads Manager: The Most Common Questions
Can I change the budget later?
You can change the amount at any time. The budget type – daily or lifetime – can't be switched after publishing, though. To change it, you need to duplicate the campaign or ad set and set it up again.
My tip: Increase your budget in several small steps rather than all at once. In my experience, big jumps tend to throw delivery off track.
Why can't I choose a lifetime budget?
A lifetime budget always needs an end date. Without one, Meta only offers a daily budget. And once the campaign is published, you can no longer switch the budget type.
Can Meta distribute the budget automatically?
Yes. With Advantage+ campaign budget, you set the budget at campaign level and Meta automatically allocates it to the ad sets that are currently performing best. If needed, you can set minimum or maximum spend for individual ad sets.
Is there a minimum budget?
Yes. Meta requires a minimum daily budget that depends on your currency and optimization goal. If your budget is below it, Ads Manager will show you a notice. For meaningful results you should plan well above that anyway – the next section explains how much.
How Much Ad Budget Should You Plan for Meta Ads Each Month?
In theory, you could run Meta Ads for just €1 per day. But that wouldn’t make much sense. There are several approaches to the question of the ad budget.
The Official Approach
Officially, Meta campaigns need 50 conversions per week to get out of the learning phase. This gives you the best campaign results. This is where the cost per sale comes in. In theory, you therefore need:
Cost per sale x 50 = weekly budget
Concretely, that means that with costs of €10 per sale you should plan at least €500 per week, which corresponds to at least €2,000 ad budget per month.
For smaller advertisers, however, that is usually already above the possible budget.
In addition, it doesn’t conversely mean that you can’t be successful with Meta campaigns with fewer than 50 conversions. Every conversion serves the campaign as a signal to improve campaign performance. So 7 conversions in a week are better than no conversions.
So when you start a Meta campaign, it always begins in the learning phase first. Concretely, that means that Meta’s algorithm still has to optimize itself and the campaign doesn’t deliver optimal results. The more signals (conversions) the campaign collects, the better it works.
The Practical Approach
With smaller budgets, it is advisable to spend at least as much budget daily as you need for one sale. This probably won’t get you out of the learning phase, but it ensures that the campaign can achieve at least one conversion per day.
Following our example, you can therefore set the daily budget to €10, which results in €300 ad costs per month.
Allocation with Larger Budgets
If you have more money than just the minimum budget, you have to think about how to distribute your budget properly. This usually results in the need to split the budget across several campaigns in order to achieve more complex or multiple goals.
This is where the real game of budget allocation begins.
The budget is distributed either at campaign level (Campaign Budget Optimization, CBO for short) or at ad set level (Adset Budget Optimization, ABO for short).
As a rule, you should always make sure that the individual campaigns or ad sets have at least €10 available per day.
How Do I Get Started with Budget Planning for Meta Ads?
When planning campaign budgets, I always work in 3 steps:
The Annual Overview
It’s best to start budget planning with the annual overview.
You have the annual budget X.
So you distribute the annual budget X across the 12 months.
In doing so, you should above all take the company’s seasonal factors into account, such as peak times around Black Friday, Christmas, or other relevant phases.
It also helps to orient yourself by the previous years’ budgets.
In my example, you can see the previous year’s monthly budgets in row 6 (marked blue). Below that you can see the share of each monthly budget in last year’s annual budget in %.
This gives you an overview of the individual monthly budgets (as an example: annual overview including channel split):
The Channel Split
Building on the monthly budgets, you divide the budget among the respective social media channels (channel split).
This lets you determine the weighting of the individual channels.
Recommendation: Here you should orient yourself by the CPLs (cost per lead), or the lead-to-sale ratio (sales from leads). Of course, you should invest in the channels that bring the best (or most) leads.
If you don’t have a data foundation, I recommend a balanced split, which you then adjust to channel performance over time.
This gives you an overview of how much budget each channel has available in a given month.
You can find the example in the annual overview.
The Campaign Split
Now you know how much budget each channel has available in a month. You can now distribute this budget across the individual campaigns planned for the respective month.
You divide the respective campaign budget by the number of days in the month. Or, for simplicity, always by 30.
With this scheme, you can calculate the daily budget of each individual campaign in every month of the year.
So far, so good.
The magic word now, however, is dynamic.
How Do I Adjust My Meta Ads Budget Planning Dynamically?
The problem:
In the digital world, nothing stays the way we planned it for long.
There is usually an initial budget plan – but it usually gets revised 3 more times. On top of that, your budgets often change during the month and so the daily budgets have to be recalculated.
Recalculating all budgets every time only costs you your valuable time.
The solution:
Quite simple: a spreadsheet with stored formulas that automatically adjusts your budgets when things change.
Either an Excel spreadsheet, or a Google Sheet. Whichever you like better.
As clear as possible, easy to use, and above all: dynamic.
Here from the example above:
The Annual Overview
The total annual budget in this case is in cell 4O (marked green, €115,394).
You can now have the monthly budgets for the current year calculated automatically by entering the following formula in the respective cells:
annual budget x percentage share from row 7
.
If you now want to increase or decrease the monthly budget for a specific month, you can do so using the percentage share.
Just make sure your percentage distribution doesn’t exceed 100% (check in cell O6).
As soon as the total annual budget changes, all monthly budgets change automatically too.
The Channel Split
Building on the monthly budgets, you divide the budget among the respective channels (channel split).
This lets you determine the weighting of the individual channels.
Recommendation: Here you should orient yourself by the CPLs (cost per lead), or the lead-to-sale ratio (sales from leads). Of course, you should invest in the channels that bring the best (or most) leads.
If you don’t have a data foundation, I recommend a balanced split, which you then adjust to channel performance over time.
This gives you an overview of how much budget each channel has available in a given month.
You can find the example in the annual overview.
The Campaign Split
The ad budget is only part of the total costs. Depending on the project, there are also costs for management, creatives, or landing pages. You can find an overview of all costs in my article “Meta Ads Costs”.
Do You Need Help with Your Budget Planning for Meta Ads?
As part of my Meta Ads strategy development, we’ll plan your budget together:
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