Editors Note : This post was updated on November 29, 2017

Facebook Ads give you the opportunity to reach potential customers from the over 2 billion people on Facebook. Facebook is unique in that, while you can target by the location, gender, and age, you can also target likes and interests, relationship status, workplace, and the education of your target audience.

In this guide, we'll walk through Facebook Ads to get you familiar with the ad network.

Facebook Campaign Creation

When setting up your first ad, you'll need to define your objective. Your choice will affect which settings are exposed to you during ad creation to simplify the process and Facebook will also report on your chosen objective.

Awareness: Objectives that generate interest in your product or service.
Consideration: Objectives that get people to start thinking about your business and look for more information about it.
Conversions: Objectives that encourage people interested in your business to purchase or use your product or service.

Awareness

• Brand Awareness : Increase awareness for your brand by reaching people who are more likely to be interested in it.
• Reach : Show your ad to the maximum number of people.

Consideration

• Traffic - Send more people to a destination on or off Facebook such as a website, app or Messenger conversation.
• Engagement - Get more post engagements, Page likes, event responses or offer claims.
• App Installs - Get more people to install your app.
• Video Views - Get more people to view your video content.
• Lead Generation - Drive more sales leads, such as email addresses, from people interested in your brand or business.
• Messages - Get more people to send messages to your business in Messenger.

Conversions

• Conversions - Promote specific conversion events for your website.
• Product Catalog Sales - Create ads that automatically show products from your product catalog based on your target audience.
• Store Visits - Get more people nearby to visit your brick-and-mortar locations.

Writing Your Ads

• Image : Your image should be eye-catching and relevant to your copy. Try to use a clear image that will still look good when viewed as a small thumbnail.
• Headline : This is the most noticeable text in your ad so make sure it will capture a person's interest and encourage them to read the rest of your copy.
• Copy : Make sure to explain what you're advertising along with the details of your products, services, and offers. Keep in mind that people are not actively looking for your offer, so you'll want to write copy that will pique their interest. Your landing page can close the deal.

Audience Targeting Options

After creating your ad, you will be able to choose the specific audience for your ad. You’re sure to be impressed with the ways Facebook lets you precisely target an audience by demographics, attributes and interests. Here are some of the ways you can choose who will see your ad:

• Location : Target people by where they live.
• Age : Target people by how old they are.
• Gender : Target people by their gender.
• Interests & Categories : Target people by their interests.
• Connections :  Target people by Pages they like.
• Custom Audiences : Target specific people by email address or other identifying information.
• Advanced : Target people by language, education, workplace, etc.
• Lookalike Audiences : Target audiences that look similar to custom audiences.

For a detailed breakdown of the different targeting options along with how to best use them, read our Guide to Facebook Ads Targeting .

Budgets

Your daily budget is your spend limit on a specific campaign each day, so it should be an amount you'd be comfortable spending per day. Each campaign will have a separate budget and your ads will run until the budget has been met for that day. You'll never accrue charges in excess of the budget you set. Additionally, you can also set a lifetime budget to spend over the entire scheduled duration of a campaign. Learn how to set your campaign budgets .

Bidding

There are two main bidding methods with Facebook Ads:

1. Bid for Clicks (CPC) - This bid is for each time a person clicks your ad. This bidding method works well if you want to drive traffic to your website.
2. Optimized Cost Per Mille (oCPM) – Allows for bidding based on your desired end goal (objective type). It’s used to drive website conversions, specific engagement actions, or app installs. Learn more about Facebook's oCPM Bidding .
3. Bid for Impressions (CPM) - This bid is for each 1,000 times your ads are shown. This bidding method works well if you want to increase awareness of your brand.

Most people opt for the CPC bidding option, which means they’re charged according to the number of clicks they get on their ads. When you run your ad or sponsored story on Facebook, you will only be charged for the number of impressions (CPM) or clicks (CPC) it receives. The amount that you pay will never be more than your daily or lifetime budget and there are no additional fees associated with running ads or sponsored stories on Facebook. The larger your budget, the more people a campaign is likely to reach.

Facebook's ad system uses an algorithm that chooses the best ad to display based on a variety of factors, including the historical performance of each ad and their bids. The bid necessary to display your ad will fluctuate as Facebook learns more about your ad based on its actual performance, and as the pool of competing ads changes.

Analysis & Optimization

#1) Tracking your results

While creating Facebook Ads is fairly straightforward for new advertisers, analyzing performance after the campaign has launched can be more difficult. Learn how to analyze campaigns and ads and create reports in our Guide to Analyzing Facebook Ads Performance .

If your goal is to generate leads, inquiries, or sales that result from the clicks  you receive, you'll also want to configure conversion tracking on your website in order to attribute those actions to your ads on Facebook and evaluate performance.

#2) Improving your ads

You can find the best performing ad text for your targeted audience by testing multiple ads and evaluating results regularly.

• Description : Include a clear action you want your audience to take in the body text of your ad. Also be sure to highlight your benefits and any special promotions.
• Image : Make sure your image is relevant and eye-catching. Also be sure to update your images frequently as your customers can quickly become fatigued.

#3) Improving your targeting

• Test an ad with broader targeting
  Make sure you are not targeting too few people. If your targeting is too narrow, the delivery of your ad or sponsored story may be limited. To improve the performance of your ad, try relaxing your current targeting to expand your potential audience.
• Test an ad with narrower targeting
  If you narrow down your targeting, you can reach people that will be most interested in your ad. You can check your Ad Reports and Page Insights to see who is responding to your ads and add additional targeting filters to reach the most relevant audience.

If you're not satisfied with the number of people your ad actually reaches, read the Top 5 Reasons Your Facebook Ad Has Limited Reach for tips to improve it.

Auditing Your Account

Finally, you'll want to audit your account every few months or so to make sure there are no major issues or missed opportunities. Check out our comprehensive Facebook Ads Audit Guide for an easy-to-use checklist.

Summary

Reach your target audience where they spend most of their time. AdStage offers a complete campaign measurement, reporting, and automation solution for Facebook Ads .