• In this video, we break down CBO vs. ABO vs. MBO. CBOs are often great for managing budgets. ABOs are also great for managing budgets, but you can work them into scale faster and then manual bidding opens up the flood gates to spending as much as you want as long as you're bidding in a way that allows the auction to give you all the traffic that you want.

• CBOs essentially not only allow you to spread your budget amongst a variety of audiences in the campaign, but it's more used towards keeping your budget at a level that is maintainable for you. So if you want to spend a hundred dollars a day, you could set the whole campaign to just a hundred dollars and it'll spread it amongst the audiences you want to target. 

• Here are some examples, let's say you have 20 audiences and you got $500, you can essentially create four campaigns at $125 per campaign and have five audiences each, or you can do five campaigns where there's four audiences each at $100 a piece. Then you can figure out what's worth scaling. It's a lot easier to turn off and turn things on, especially if it's an entire campaign.

•  If you're going to use CBOs, you want to keep it where all the interests in a CBO is lookalikes. Such as look alike 1%, look alike 1 to 2%, look alike 2%. They all need their own campaign. Because if you have audiences with too large of a budget mixed together, oftentimes all the money will go towards the one audience that's larger.

• The great thing about CBOs is you can easily duplicate them and put all the audiences that work well together. So let's say they're at a five interest and three of them did well, you can duplicate that entire campaign and just take off the audiences that didn't perform well. Same thing with ads that didn't perform well. Leave everything that did well in its own campaign and restart at the same budget or higher. We like to use CBOs when we're scaling campaigns because budget management and we're able to bundle together anything that's doing well.

•  If you want to test a lot of ads at $5 budgets, $10 budgets, $20 budgets. This is when you use ABO and you can keep it all under one campaign because they don't affect each other. So in the video there is a campaign that's using all ABO, so every single one of these audiences use $100 and they're all different audiences. Some are interests, some are lookalikes, some are lookalikes at 1% and 10%. Some of these campaigns even have interest in lookalikes bundled together.

• When you know what's working for an ABO you can split off these same audiences and make a CBO, all the lookalikes in one CBO, all the interests in another,  with the best performing copy and creative.

• ABO is good for aggressive testing, meaning if you want to test every single interest and every lookalike, and every copy variation all at one time. ABO it's going to spend more money, so if you want to control your budget use CBO.

•  You can do manual bidding from a CBO or ABO setup, it's all based your budget. So let's say for example, we wanted to do it on the ABO side. You just open up an ad set that you want to work with. You go all the way to the bottom and see your cost control. You have to choose between a cost cap or a bid cap.  If you want to control your costs than you would choose a bid cap. Cost cap is for getting the most volume.

• You would want to use a bid cap during the time of the year when a lot of e-commerce companies are spending tons of money on ads, and you have to outbid your competition in order to get the traffic. Sometimes you don't get as much volume with cost caps as you would with bid caps. 

•  With a CBO set up for manual bidding, this is where you have the cost cap, the bid cap, and then minimum ROAS. You can not do minimum ROAS until you have, around 100 or 200 purchases with value attached to it. Now when you set it to minimum ROAS, what Facebook will do is try to optimize the campaign based on the ROAS. The higher the ROAS, the harder it's going to be for it to deploy.

•  When you test with manual bidding, test it with smaller budgets. Oftentimes it'll spend 30 to 40% of the budget for that day sometimes the whole thing. You want to have some budget risk and you want to make sure that you can control everything. 

David (00:00):

Hey everyone. Welcome back in this video, we're breaking down CBO versus HBO versus manual bidding. And each one of them has their own purpose, right? CBOs are often great for managing budgets. Abs are also great for managing budgets, but you can work them into scale faster and then manual bidding. Well, you've now opened up the flood Gates to spending as much money as you want. As long as you are bidding in a way that allows the auction to give you all the traffic you want. So first let's break down CBO. Now I mentioned in a previous video that CBS essentially not only allow you to spread your budget amongst a variety of audiences in the campaign, but it's more used towards keeping your budget at a level per day. That is maintainable for you. So if you want to spend a hundred dollars a day, you could set the whole campaign to just a hundred dollars and it'll spread it amongst the audiences you want to target.

David (00:54):

Now keep this in mind. I mentioned that I do not like to spend more money on, let's say more than six audiences in a campaign. If you want to spend 500 a day, that's great, but maybe not put 500 into a campaign and put 20 audiences in there. I typically would do, let's say four to five. So if you want to make it easy, and let's say you have 20 audiences and you got $500, well, you can essentially create four campaigns at one 25 a piece and have five audiences each, or you can do five campaigns where there's four audiences each at a hundred bucks a piece. Then you can just take it from there and figure out what's worth scaling. And from a budget management standpoint, it's a lot easier to turn off and turn things on. Especially if it's an entire campaign, do you have an extra hundred or $200 to use and you could spread it out, right?

David (01:46):

So as you can see in this example here, this is an ad set that's using CBO. And you could tell because it's under the budget section, it shows the total budget for the day. And I oftentimes keep it, like I said, between four and six in this campaign, it's five audiences and it's all interests. If you're going to use CBOs, like I mentioned, you want to keep it to where it's all interests in a CBO, all lookalikes. And it's not just any look like you would do look alike. 1% look alike. One to 2% look like 2%. And they all have their own campaigns. Because if you have audiences with too large of a budget mixed together, it oftentimes we'll spend all the money towards the one audience. That's the largest. So if you're targeting all parents and that's 10 million people, but then you're targeting grandparents and it's 3 million, it's going to spend more of the money on the 10 million person audience.

David (02:31):

Even if the smaller audience is performing better because there's more audiences to work with. There's more people in the audience to work with. So it wants to optimize with that larger audience. So keep that in mind when you're bundling the audiences together, try to keep them in a similar size. Now also keep this in mind. Let's say you want to scale a CBO. The great thing about CBOs is you can easily duplicate them, put all the audiences that work together. So let's say they're at a five. Three of them did well. You can always duplicate that entire campaign. Take off the audiences that didn't perform. Take off the ads that didn't perform and leave everything that did well in its own campaign and restart at the same budget or higher. And oftentimes in my experience, it continues to work well. And we like to use CBOs when we're scaling campaigns, because one button, budget management, too, we're able to bundle together anything that's doing well, all interests, all look like 1%, all lookalikes, 3% so on and so forth into one central location at a higher budget.

David (03:35):

And it does well. Now what about ABO? When would you use that? Well, oftentimes if you want to test a lot of ads at $5 budgets, $10 budgets, $20 budgets. This is what most people are using and you can keep it all under one campaign because they don't affect each other. So as an example, this is a campaign that's using all ABO and you know this because now on the budget section, it only shows it once you entered the campaign. So every single one of these audiences uses a hundred dollars and they're all different audiences. Some are interests, some are lookalikes, some are lookalikes are 1%. Some of them are lookalikes at 10 weeks percent. Some of these campaigns even have interest in lookalikes bundled together, and I can keep it all in one place. And you could see, I know the average cost per result.

David (04:21):

I know how many purchases are in here and it's all in one place. Now here's the great part about HBO now that I know what's working in the ABO, I could split off these same audiences and make a CBO, all the lookalikes in one CBO, all the interests in another, right, with the best performing copy and creative. So you could see where they come in handy, right? When do you use CBO and AVO? It's all personal preference. But I personally like to use ABO for aggressive testing, meaning if I want to test every single interest in every local, like, and every copy variation all at one time, I'm going to use ABO it's going to spend more money, but if I want to control my budget, then I'm going to use CBO. And that is what I'm going to bundle those audiences together. And I will put one copy and one creative together in a campaign to test and I will have another variation and another campaign and another variation and another, I don't like to bundle too many creatives and copy in the one CBO because once again has to write out the budget.

David (05:19):

Okay. So keep that in mind when you're testing, right? Try to keep the minimum amount of variables in a campaign one time. So if you have three images and three pieces of copy, you'll do one campaign where it's the same image, right? Three different variations of copy, or it's three pieces of, of creative. One variation of copy that way. At least you could see which image worked with this copy or which copy worked with that one specific image. And you can minimize the amount of budget risk that you have. Now. What about manual bidding? Yeah. This is where things get interesting. You can do manual bidding from a CBO or ABO setup. And once again, it's all based your budget. So let's say for example, we wanted to do it on the ABO side.

David (06:04):

Then it's very simple, right? You just open up an ad set that you want to work with. You go all the way to the bottom and you can see here that your cost control. Do you want to do a cost cap, a bid cap right now because of the fact that I already have this set up, uh, it won't allow me to change it. But once you put in the number, let's say you want to control your costs. You don't want to spend more than $30 for a sale. Okay. So you say my cost control is I don't want to spend more than $30 on a sale and cost cap is for getting the most volume. Whereas bid cap is for controlling the bid. Okay. That's very, very important. Now, oftentimes I use cost caps mainly because I want to make sure that my CPA is within a range.

David (06:47):

It makes sense for the client. But when you get reached times of the year, such as Q4, when a lot of e-commerce companies are spending tons of money on ads, sometimes you have to use bid cap because you have to outbid your competition in order to get the traffic, you could still get great results with both. Sometimes you don't get as much volume with cost cap as you would with bid cap. So keep that in mind. Now this same exact setup works the same way with a CBO except with a CBO, especially when you're using something like when you're working with an e-commerce store, as an example, here's the great thing about the manual bid. Okay. So now we want to go to the campaign settings cause we're doing a campaign budget optimized campaign. So you can see here campaign bid strategy. You click edit everything by default as high as value or lowest cost.

David (07:35):

But this is where you have the cost cap, the bid cap, and then minimum ROAS. You can not do minimum ROAS until you have, let's just say a hundred or 200 purchases of some sort with value attached to it. So that you're able to then set up a campaign based upon what that ROAS can be. And because you want to return on ad, spend of, let's say at least a 2.0. Now when you set it to minimum row, as you can go to that individual audience and you could set it so you can put 2.0 and then what Facebook will do is try to optimize the campaign based on the ROAS. Now, of course, the higher the ROAS, the harder it's going to be for it to deploy. So oftentimes I like to keep it at a two because at least the two for most businesses is considered breakeven.

David (08:18):

Some businesses breakevens 1.5. So you can even set the ROAS at, let's say 1.5, which is low for most people in the e-commerce space. And you'll get a ton of traffic and it'll work its way into possibly maintaining that row as consistently. I've had great results with this. It's a form of manual bidding to keep that in mind, but not everyone has access to it. But if you were doing a cost cap or a bid cap, you would simply go here. Let's say you do a cost cap. Continue. Now you would go to the audience again, go to the very bottom and you would say, okay, how do I maintain my control of cost? I don't want to spend more than $30 on a sale. And then you would just go about setting up the rest of your settings. And so that is the main reason you would want to use manual bidding.

David (09:05):

You want more traffic, you want to outbid your competition. You just want more volume. Oftentimes you can't set these budgets to $10 a day, $30 a day. These are campaigns set the (500) 750-1000 5,000 a day. Cause it's not going to spend the entire budget. So keep that in mind. This is usually for scale to be very, very careful with manual bidding and it could work very well in your favor, as long as you test it. And if you do test it, maybe test it with smaller budgets. Oftentimes it'll spend 30 to 40% of the budget for that day. Sometimes it spends more than that. Sometimes we'll spend the whole thing. So be very careful, but you want to have some budget risk and you want to make sure that you can control everything, use ABO or CBO and you should be fine. And that is the breakdown of the difference between CBS abs and manual bidding.