CBO - Campaign Budget Optimization Tips | 2020 | Digital Distillery


Author: Ad Hacks January 23 | Blog


Author: Ad Hacks January 23 | Blog

Campaign Budget Optimization (CBO) is big news and you need to gear up ASAP before Facebook makes it mandatory on 27 February 2020.

Existing Ad Set Budget Optimization (ABO) campaigns are still going to be able to run but you’ll only be able to pause, unpause and increase budget.

We recently explored what CBO is with FATC Guest Coach, Depesh Mandalia.

Quick recap:

  • Depesh Mandalia is CEO of SM Commerce, ZASE Digital and one of Facebook’s advisors who has managed over $30M in ad spend budget
  • After taking many L’s (losses), he scaled a $800k eCommerce business to $26,5M using his experience from trials and errors
  • It’s this trial and error mentality that made him experiment & become well-equipped with Campaign Budget Optimization since early 2019
  • CBO is a proven system that’ll help you repeatedly increase consistency, growth and profit
  • This system isn’t just a new way of managing budgets
  • Based on Depesh’s experience, CBO works better when you have formally pre-tested your audiences, creatives, products and funnel. It’s what he calls the CORE-4.

Speaking of which, this week we’re diving a little deeper into CBO as we look into the key elements or ingredients, if you will, that goes into making CBO campaigns a success.

Depesh’s 7 Ingredients for CBO:

  1. The biggest lever is feeding your Campaign Budget Optimization with good quality, pre-tested Facebook ads/offers/creative and audiences – for you FATC guys, that’s RFT – Rapid Fire Testing. I use something similar but different, but it has the same output – test which ads and audiences match up
  2. Size your CBO’s accordingly – if audience sizes are all mixed, like a 500k and 10M audience, the campaign will struggle to spend it fairly and find consistent results. Split CBO campaigns by size
  3. Separate out your Interests from your Lookalikes from your Broad audiences into separate CBO’s. We’ve found grouping similar types of audiences by CBO also helps consistency
  4. CBO does work for all budgets – the higher the better but if you’re limited, then don’t launch too many ad sets or ads and optimise to get as close to 50 conversions at the campaign level. I know Facebook asks for 50 per ad set but our testing has shown 50+ per campaign to be effective
  5. Ensure your excludes are set up properly. BOF excludes existing customers. MOF excludes BOF and TOF excludes everything else below it. (B=Bottom, M=Middle, T=Top OF=Of Funnel)
  6. For the best consistency, scale no more than 30% budget increases per day. If that’s not fast enough then be ready to give up a level of consistency
  7. Never stop testing – ads die out before ad sets so keep testing for new ads, angles, creatives, etc. If your CBO starts to wobble you’re there to retain performance

Watch a sneak peak of Depesh’s exclusive talk now!

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After giving our FATC members time to digest Depesh’s CBO webinar, we hosted a Q&A where we chatted about setting up, testing & scaling Campaign Budget Optimization campaigns.

Q&A with Depesh. Watch now!

FOMO creeping up? Not to worry. Just hit here, sign-up to FATC and watch Depesh’s FULL talk and Q&A go down.

If you’re already a member you’ll see the Guest Coaches section of the portal updated shortly.

Tested CBO campaigns yourself and ready to scale up even more?

Depesh put together The Ultimate CBO Cookbook – a 70 page eBook filled with flop-proof, step-by-step CBO recipes and insights for the hungry Facebook marketer (YOU ?).

You’ll learn how to build profitability, stabilise Campaign Budget Optimization campaigns, master testing and scaling, benefit from a live Q&A with a bonus transcript, case studies, plus so much more.

“We’ve spent multiple million dollars over the last 12 months testing, learning and improving our CBO recipes for prospects from top of funnel (COLD) right through to WARM and red HOT, converting at low costs and high profits.” – Depesh

For a taste of what to expect, check out Depesh’s 5 Recipes for maximising your CBO success where he references the eCom business he built to $16M from $2M in just 5 months.


1) It’s more than a winning product

To succeed with Facebook ads and eCom in 2020 you need more than just a winning product.

You need a great sales funnel, customer experience and lots of creative testing.

The team over at Facebook are doing everything they can to ensure users have a great experience on THEIR platform. Which means you need to keep Facebook users happy if you want consistently good, profitable traffic.

You need to focus on measuring and improving:

  • Page Load Times
  • Website Engagement Rates
  • Funnel Conversion Rates
  • Reducing Refund Rates
  • Answering Queries Fast
  • Keeping Page Monthly Satisfaction Scores above 4.0

Stop thinking in terms of products and focus on experience.

Whether you’re running your own eCom store or for clients.

Solve a problem, or create a new opportunity.

Communicate it clearly.

Facebook ads simply allows you to connect this all together.

We did this on this store to bring LOWER CPMs and HIGHER conversation rates resulting in higher ROAS. Because you give Facebook what it wants they give you the best users at the cheapest cost.

At peak, we had CPMs hovering between $6-8 in competitive markets.

CBO works better when you have pre-tested your audiences, creatives, products and funnel. What I call the  CORE-4. It’s essential for growth WITH profitability.


2) Invest in testing

I loved watching The Matrix and seeing Keanu/Neo learn new fighting skills by plugging a training program into his brain and mastering it in seconds.

Whilst we can’t do this, yet, you can pay to accelerate your knowledge.

Find the thing you have the least knowledge of that can provide the highest leverage and find a way to outsource it.

Here’s an example…

I  launched a new eCom store but  ‘outsourced’ the product side of it.

I’m a marketer, not a product guy. So I hired an ace product team to help research and direct us on product whilst me and my team focus on our zone of genius.

It costs more in the short-term but we’ll profit higher, faster.

If you don’t have money, you invest with your time, by learning and applying things yourself.

Campaign Budget Optimization allows you to set a single test budget and test more efficiently.


3) Build the right test, optimise and scale structure

Something as simple as excluding ENGAGED audiences from COLD audiences and SITE VISITORS from ENGAGED audiences can make all the difference.

I use the COLD, WARM, HOT audience grouping to decide on my angles, budgets, exclusions, targeting and more.

COLD: new traffic, not engaged or visited your site

WARM: engaged (e.g. page fans, engaged with posts, video viewers, etc.) but not yet visited your site

HOT: visited site not purchased

Each grouping excludes the one below, so COLD excludes WARM which excludes HOT.

This keeps auction competition low and helps serve the right message at the right time.

I use INFINITY audiences in WARM and HOT, using Dynamic Content Optimization (DCO) and Dynamic Product Ads (DPA) to keep the amount of creative changes here to a minimum with these smaller lower funnel audiences.

For example, if someone has watched a video to 75%, then every 7 days there are new people in this audience.

Firing up a DPA or DCO ad here does a great job of keeping ads fresh and with CBO, using multiple audiences, Facebook decides each day which audience is working best and where to put budget into.

We scaled top of funnel ads, despite a lower ROAS than our target, because we had this funnel structure in place, allowing us to measure the trickle down from COLD ROAS to WARM ROAS to HOT ROAS and seeing an overall ROAS with high profit, at scale.

So it’s not only helping your audience targeting, it’s also helping analysis and  decision making.

CBO allows you to build more stability using a structure like this.


4) Signal Facebook that you’re ready

Assuming you’ve followed steps 1-3, you’ve now given Facebook all the right signals. But we can do more:

  • Post regular updates on your PAGE – this gives Facebook the signal that you care about fans and drops CPM
  • Test for virality of your best posts. I’d recommend putting small spends to your best page posts to see which catch on in terms of engagement using PPE – paid and organic engagement help your Page score
  • Focus on high website conversion rate over high CTR. This counts for more to Facebook – CTR is more vanity than website CVR%
  • Take Facebook’s Ad Relevance/Engagement Metrics seriously. FB now tells you, beyond what Relevance Score used to (a rating from 1-10), and now split your scores by your targeting, creative and site performance. Big clues here on where to focus and improve.

People that wonder why Campaign Budget Optimization isn’t working for them underestimate the importance of feeding the Facebook engine good fuel.

These small but significant shifts will bring your CPM further down. Take them as seriously as I do. Low CPM and high conversion rates – a big secret to high ROAS.

Feed CBO healthy data to produce healthy results.


5) Know when to exit the battle to win the war

Managing budgets on Facebook is a daily battle at all levels of spend. Knowing when to quit and when to fight is part of becoming an experienced media buyer.

When running a CBO campaign, whilst Facebook needs as much data/time/budget as soon as possible, to get your stability the reality is FB will make you lose money fast if you don’t control it.

Learn, by time of day and campaign, what good looks like and react early.

If you know by 12PM your cost per ATC (add to cart) should be $15 and it’s $35 –  pause it. Duplicate it, move on. If by 3pm ROAS should be 4.00 and it’s less than 1.00, kill it.

Campaign Budget Optimization will learn and adapt but it needs your help.


6) Scale comfortably

There are many options for scaling a CBO:

  • Budget increase
  • Duplicate to higher budget
  • Duplicate into segments
  • Various manual bids
  • Lifetime budgets and more

I prefer a mix of budget increase and duplication but we’re testing more with lifetime budgets. Manual bid’s are great for short-term spikes but auto bids win long-term when you’ve followed the steps above.


Get your hands on The Ultimate CBO Cookbook now for $149 – 25% less using our discount automatically applied at checkout. Offer valid for a limited time only. T&C apply.


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