CPM : Cost per 1,000 deliveries
Target group : size of your target group
Frequency : Contact points with your target group
The formula for calculating your Meta Ads budget is as follows:
((target group * frequency)/ 1,000) * CPM
Formula: ((target group*frequency) / 1000 ) * CPM
During your campaign preparation, you created a target group on Meta and Meta gave you an expected target group size. Let's assume that your target group includes 300,000 people. During the venezuela whatsapp resource campaign, you want to reach your target group in this example at least 3 times with ads (frequency = 3). Therefore, you multiply the target group size by the frequency. The product of this is divided by 1,000, as the subsequent CPM is a cost per thousand contacts (CPM divided by 1,000 then gives the cost of one display). The CPM is estimated at EUR 3, as you want to run a reach campaign and expect good performance. Now you have all the variables to fill the formula:
((300,000 * 3 )/ 1,000) * 3 EUR
The following calculation steps will take you to the final budget:
((300,000 * 3 )/ 1,000) * 3 EUR
= (900,000 / 1,000) * 3 EUR
= 900 * 3 EUR
= 2,700 EUR
You can now use the formula based on your own CPM experience to calculate your individual meta campaign budget. It is important to note that the calculation does not represent a binding budget! In practice, the frequency and CPM can fluctuate significantly up and down. However, this formula is recommended as a first numerical basis. If the performance is successful, we always give our customers a recommendation on how the budget can be increased in order to achieve even more results.
Here is a cheat sheet for your records:
Costs for Meta Ads - Formula and Factors Chart
Conclusion: How to calculate your optimal Meta Ads budget
In this article, we learned how to calculate your individual campaign budget for meta ads in just a few steps. For the formula presented, you need the size of your target group, the estimated frequency and the estimated CPM. This CPM is influenced by many different factors. Firstly, the CPM depends on which campaign settings you make (budget, advertising goal, target group and advertising placements). Basically, the greater the potential reach through a campaign setting, the cheaper the CPM. Secondly, the final CPM is then determined in the meta auction process. The budget used (as a bid), the expected click rate and the ad relevance (as a user signal) all play a role here.
We hope you were able to learn a lot in this article about what your next meta campaign will cost you. Of course, we haven't mentioned the most important factor in the article itself: A professional meta ads agency has enough experience to achieve the best possible results with your advertising budget.
You can look out for the partner badge here. These are companies verified by meta that meet the high criteria in terms of budget management and campaign quality. If you are interested , please contact us , we look forward to advising you on your next campaign!