How it works (part 5)

How It Works

Facebook charges you for your ad placements in two different ways (you have the choice of how you want to be charged).  The first way is called Pay-Per-Click (PPC), which is pretty self explanatory—you will be charged every time someone clicks on your ad.  You can set your daily budget to any amount that you would like and you can also set the amount that you would like to be charged every time someone clicks your ad (Facebook’s prices are very reasonable).
Here is a quick example:

As you can see, I have set my daily budget for this ad at $25 and my max bid is 65 cents (you will not always be charged the max bid—in fact, most of the time it will be a good bit less).  With this setup I am paying for at least 38 clicks ($25/.65 = 38.46 clicks  -> but you will pretty much always get more than that because you will rarely be charged 65 cents for every click).  Also, I could have had a max bid of 25 cents per click, even though Facebook suggests $0.57- 0.75 for this particular ad.  With a max bid of 25 cents per click I would be paying for at least 100 clicks ($25/.25= 100 clicks).  The only thing that happens when you have a max bid less than Facebook’s suggested bid is that your ad will not be shown as often (fewer ad impressions)—so you may miss a valuable click that transfers into a conversion.  Ok, so with this ad I am paying for at least 38 clicks, which means that I believe that at least 1 person out of 38 clicks will convert on the offer that I am promoting.  Obviously I will have to be compensated accordingly—I am paying $25 for those clicks, so my commission better be more than $25 when someone converts on that particular offer (the goal is to find that highly converting offer that will pay off big).  Do not be discouraged; do not give up.  This can take time to find the right offer and the right ad content, but you will find it.