The way you’re communicating with Facebook's ad platform is via your account structure. This structure is based on three levels:
- Campaign → objective
- Adset → targeting, schedule, budget
- Ad → creative tools to build your creative
Through this structure you're able to answer 5 important questions. You are advertising using a very, very sophisticated machine learning algorithm. And while the algorithm will do all the heavy lifting, it asks the following five things of you:
- “Tell me what I should be looking for (conversions, clicks, views).”
- “What do you want to pay for this (your bid)?”
- “Give me enough budget so I can catch a few of these things for you.”
- “Give me an asset I can distribute to a specific audience”
- “Let me go my own way, don’t constrain me too much, and don’t interfere while I’m working.”
We’ll talk about the last point first. The constraining of the algorithm. How do you know if you are constraining it too much? You’ll notice two things:
- A lack of conversions
- Ads are expensive (because your conversion rate is low)
There are four factors causing this:
- Low budget
- Overlapping audiences
- Small audience size
- Limited placements
The solution? → Account consolidation.
Account consolidation means minimizing and combining all your ad sets and ads into one campaign. This lets the algorithm focus its attention and your budget on your most important goal: as many conversions as possible for the lowest possible price.
When you consolidate your account, you’re telling the algorithm: “I value all of these ad sets equally. I don’t care which one gives me conversions.”
What does a good account look like?
1 Campaign - 1-3 Adsets - 2-5 Ads
Okay, let’s get back to consolidation. The goal of consolidating your account structure is to get 50 conversions per ad set as quickly as possible, so you’re not spending too much time in the learning phase.
When should you consolidate?
You should be consolidating when your ads have the same value (products, margins, etc.) and creatives but differ in audience and placement. In this case, simply put everything together and let the algorithm find the right people to target.
There are several indicators that you need to consolidate.These are as follows:
- Your daily budget is too low. How do you know? You can use this calculation. Average CPA * $50 = minimum budget. For example: if your CPA is $15, then $15 * $50 = $750. Your budget should be $750 minimum (as a total budget).
- Your audience size is too low to get enough conversions. Consolidate all ad sets with the same audience into one ad set.
- Your audiences are overlapping (how to check overlap).
- Your ad sets are split by placements (Facebook, Instagram, Messenger, etc.).
- Your ads are spread too thin. Too many ads in an ad set makes it difficult to gather consolidated learnings. What to do: limit the amount of ads to a maximum of six.
When should you choose not to consolidate?
It is often best not to consolidate in the following scenarios:
- Your ad sets have different objectives. The algorithm’s goal is to find people who match your objective (people who buy, click, view, etc.). The algorithm can only pick one objective to work on, so consolidating will not be the right thing to do if you have multiple objectives.
- Your audiences have different values. The algorithm looks for the cheapest conversions, disregarding the details of who is buying. If you have information about a certain type of audience that the algorithm will not detect, you should not consolidate.
- Your locations are valued differently or you need to prioritize one location above another. Again, in this instance, the algorithm will go for the cheapest conversions. It won’t take countries or specific locations into consideration.
If you want to stick with all your ads and ad sets anyway, then make sure you use exclusions for your audience (no overlap, as that will cost you more) and assign a sufficient budget per ad set to get enough conversions.