What is CBO? CBO Review

About CBO

CBO optimizes the budget at the campaign level. After using CBO, Facebook will continuously monitor the performance of each ad group in the campaign and automatically allocate the budget to the best-performing ad group in real time, so that the entire campaign can obtain the most conversions and maximize marketing results.

CBO spending principle

Let’s take a quick example of how campaign budget optimization can spend your budget.

Let's say you have 15 opportunities to show your ad (your campaign budget is $30):

Ad Group A: 4 times

Ad Group B: 6 times

Ad Group C: 5 times

Each impression for Ad Group A costs $5. Each impression for Ad Group B costs $2. Three impressions for Ad Group C cost $1, one cost $7, and one cost $8.

CBO bidding strategy

1. If you set the lowest cost bidding without bid cap, different ad groups should try to set ad groups with the same value (i.e. the same optimization event or goal);

2. To optimize different events or goals, advertisers can choose to set different bidding caps or target costs.

How to Control CBO Budget Spending

1. Each ad group can add a minimum or maximum spending limit to control the ad group spending (note that it may affect the overall spending speed);

2. Use different bids for each ad group and use bids to help optimize the budget;

3. Create different campaigns based on your strategy and set different campaign budgets

Advantages

1. Create higher marketing value

By allocating more budget to the best-performing ad groups, advertisers can maximize the return on investment of their campaigns. Once the budget is set, the budget optimization function will adjust the budget allocation in real time and continuously to get the most results for you and effectively reduce the overall cost per result.

2. Save management time

Because campaign budget optimization is an automated process, advertisers don’t have to manually adjust budgets for each ad set, saving you a ton of time, whether you need to adjust ad set-level budgets from setting them once per campaign to multiple times per day.

3. Simplify campaign management

This reduces the amount of budget that needs to be tracked and reallocated during optimization, and eliminates the need to recalculate budgets during ad delivery.

4. Remove duplicate audiences

If one ad set has a high degree of overlap with the audience of another ad set, you can still spend your budget on the other ad set.

5. Avoid restarting the machine learning phase

The machine learning (learn more about machine learning here) phase of campaign budget optimization will not be triggered when allocating budgets to individual ad groups, but will be restarted when you manually adjust budgets for individual ad groups.

6. Spend your budget efficiently across all audiences

Campaign budget optimization finds the lowest-cost opportunities across all ad groups and target markets.

How to use

1. Click the Start button for Budget Optimization.

2. Set a daily budget or total budget for your campaign.

3. Choose a bidding strategy.

If you choose the lowest cost bidding strategy and don't set a bid cap, all ad groups in the campaign must set the same optimization event. If you choose the lowest cost bidding strategy and set a bid cap, you can optimize for different target results and set a different bid cap or target cost for each ad group.

Note: The minimum time limit for enabling or disabling campaign budget optimization is 2 hours. If you need to turn off campaign budget optimization within two hours of enabling it, you can choose to pause your campaign and create a new campaign with the ad settings budget.

There are limitations to using CBO

1. If a campaign is turned on/off with CBO, it will take two hours for the next turn-on/off to be possible.

Recommendation: Do not modify this function repeatedly, as each modification will cause the campaign to start learning again.

2. Once a CBO campaign is started, the optimization target cannot be changed during the campaign, unless the campaign is paused or CBO delivery is turned off;

3. Each campaign can only have a maximum of 70 ad groups.

Recommendation: If you are using CBO for the first time, it is best to create 2-5 ad groups.

Precautions

1. When using CBO, do not manually pause or close ad groups.

2. Usually, an ad group needs about 50 conversions to obtain enough data and exit the machine learning stage, after which the advertising performance will gradually stabilize.

3. Whether you set up CBO for an existing campaign or when budget is automatically allocated to different ad groups when using CBO, the machine learning phase will not be triggered.

4. Making major adjustments (including changing audience targeting, creative materials, optimization events, etc.) will cause the ad group to re-enter the machine learning stage. If not necessary, these adjustments should be avoided as much as possible.

5. If you still don’t get 50 conversions after 7 days of starting or making major adjustments to your ad campaign, and you are unable to exit the machine learning phase, it means that your ad campaign is not working well and will be stopped by the system. You should consider making major adjustments to your ad group to improve its performance.

References

• 1. What is Facebook CBO? Introduction to Facebook CBO, benefits of advertising budget optimization: Sohu [cited on 2019-07-11T16:00:00.000Z]
• 2. Understanding Facebook CBO in one article: Sohu [cited on 2019-05-28T16:00:00.000Z]