“The Breakdown Effect” in Facebook Ads Explained

“The Breakdown Effect” in Facebook Ads Explained

As we’ve already talked about in our recent post, oftentimes, we get small insides about changes on Facebook and try to keep you updated on them as well!

One of such changes was the freshly-issued Facebook one-sheeter on “The Breakdown Effect” – the effect that made myself confused at the beginning.

Yet, I’ve analyzed both my data and the info presented by Facebook carefully to understand and explain this problem and possible solutions to you, Rockstars!

What “The Breakdown Effect” is and what it means to us

Overall, there are several points in this one-sheeter to understand:

– “The Breakdown Effect” is the increased cost of your results that happens when you continuously increase the budget of your campaign/adset/ad.

The Facebook machine tries to find you the best traffic available, at the best cost. However, they have limited number of traffic at this cost. So, the more you spend – the higher bids Facebook starts using on the auction to spend your budget.

This means that you cannot consistently generate cheap results while increasing your budget to no limit;

– “The Breakdown Effect” is only applicable to automatic bidding strategy.

For instance, you will not feel the influence of this effect that significantly when using manual bids as you limit Facebook with the maximum bids to use. However, in this case, if your limit is too low, you might not generate enough traffic for your campaign.

– “The Breakdown Effect” is different for different mediums – say you are using Facebook stories and Instagram stories as placement options. In this case, you get different breakdown effects (which are not interrelated) for both placements.

As explained by Facebook, if 2 different placements have been chosen, the machine initially evaluates which one of them generates cheaper results and pushes more traffic through this medium (on the graph below – Facebook).

BUT, at some point, since “The Breakdown Effect” on different mediums is different, Facebook mighttransfer to the second medium that will start giving cheaper results due to having more options on the auction;

– “The Breakdown Effect” is only applicable to significant budgets.

When testing the results, I’ve noticed that it really doesn’t apply to my campaigns with $10-20 daily budgets.

How to cope with “The Breakdown Effect”

Well, imagine that at some point, you start bidding 5-6! times more on the auction for impressions.

Of course, you want to avoid this. How?

– Do not use one placement – give the Facebook machine options to choose from;

Ideally, you want to use automatic placement so that you are maximally protected from “The Breakdown Effect” in a long run;

– Facebook additionally recommends using lowest cost bidding and CBOs to diminish this negative effect.

We’ve already discussed this in our summary of the Facebook Auction Live – they recommend to give the MAXIMUM FLEXIBILITY for the machine to learn and determine the best setup for your campaign itself;

– Test different placements separately FIRST to determine which ones generate cheapest results on the auction. Then, concentrate on 2-3 options that are most effective.

For instance, you can create a campaign that spends budget on the adset level, with $5-10 daily spend/adset – 5-6 adsets with your best proven placements and the same adset setup.

You let it run for 2-3 days and check the results afterwards. Then, you create your campaign and choose most effective placements only.

– Use several different accounts that share the same Pixel to run campaigns on lower budgets.

We have proven in the past that this is a viable strategy – run the main account and 1-2 additional accounts when you want to spend over $100k monthly.

In this case, even if you will have similar campaigns running on all accounts, as long as you use broad targeting, this will generate cheaper results for you on all accounts comparing to using one account with much higher spends.

To wrap it up

So, overall, the new Facebook one-sheeter “The Breakdown Effect” confirms the results we were getting during our tests.

– You cannot get consistent cheap results while increasing your spending due to “The Breakdown Effect”;

– You should be flexible and let Facebook as much space as possible to optimize (CBOs, automatic placement, automatic bidding);

– Test best-performing placements;

– Try introducing additional accounts and share your spending to within these accounts.

AND a small BONUS for those who got to the end

We have got another VERY USEFUL one-sheeter for you – The Events Setup Tool for Web!

Here, you will get an AWESOME video showing you EXPLICITLY how to set up different events from your Facebook Pixel – WITHOUT WRITING ANY LINE OF CODE!

So that would be it for today – “The Breakdown Effect” is a thing, it makes scaling really hard, but we have means to cope with it. What do you think guys? Have you experienced the same problems with your accounts? Yes? Have you found other ways to deal with it? Share your ideas below and let’s discuss them!

United we share!

Every month I choose a few entrepreneurs to personally help them scale their Facebook ads and businesses.

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