6 Meta Ads Principles and Concepts

Meta Ads offers a way for businesses to advertise over the massively popular platforms owned by Meta, including Facebook, Instagram, and Messenger. Venturing into the world of Meta advertising can be daunting because there are many confusing aspects of it. Like Google Ads, Meta Ads is a self-serve platform, meaning that you can log in and create campaigns that run and spend without the help of anyone else. Doing so successfully, though, requires knowledge of the system’s many rules, settings, and features. While Meta ads has always been a complicated subject, it seems to get more complicated by the month. They are continuously rolling out new features and changes.

This article doesn’t go very far in teaching you the ins and outs of Meta Ads, but it does get you started in understanding six of the most fundamental principles and concepts of how it works.

1.   What Meta Wants

After Facebook (now part of Meta) became massively popular, it began offering advertising opportunities as a way of bringing in revenue. Their first head of monetization said that they wanted to emulate the successful way in which Google offered advertising. They felt Google AdWords was an elegant system and wanted to adopt a similar approach. So, like with Google Ads (formerly known as AdWords), there are always three parties that should benefit from the process:

1. The advertiser
2. Viewers of the ads (finding ads that interest them)
3. Meta/Facebook

A win-win-win is required for the system to be successful. It’s helpful to understand that Meta makes money by selling impressions of ads (which are ad appearances). They normally charge per impression of an ad, as opposed to Google, which usually charges per click on an ad.

An understanding that Meta wants something out of the deal goes a long way in helping you understand why things are set up the way that they are. Many of the default settings are set broadly so that the audience size will be bigger. Their interest is in selling as many impressions of your ad as they can, but they give you settings and features that can help you gain more control (if you know how to use them).

2.   Where the ads Appear

People see ads through Meta in a number of different places. Knowing what the major channels are for ad distribution will help you avoid confusion as you create campaigns. It will also help you understand what opportunities are available that could help your business get exposure. Some of these channels have a variety of sub-channels, or “placement” options, in themselves. For example, the Facebook platform has many different places where ads could appear, such as in your personal News Feed, along with Facebook Watch videos, or in Facebook Marketplace.

In the big picture, most Meta advertising goes out over the following four distribution platforms:

Facebook

Facebook is the world’s largest social media platform and offers many different types of placements for ads to appear, including in the News Feed, in Marketplace, in video feeds, in Stories, in Reels, in search results, and more.

Instagram

Instagram offers several types of placements, including in the main feed, in Stories, in Reels, and in Instagram Shop.

Messenger

Through Messenger, you can run ads that show to people who have engaged with your business in the past.

Audience Network

Audience Network is a network of partner apps and websites that have agreed to allow Meta ads to appear to their users. This arrangement allows Meta to have a larger advertising reach and gives the app and website publishers a way of monetizing their offerings.

In the ad set creation process of Ads Manager, you can choose the default setting of Automatic Placements or Manual Placements. With Automatic Placements, Meta will choose over which platforms and which placements your ads will appear. Their selection is based on the campaign objective and ad set optimization settings you chose. With Manual Placements, you can choose which platforms and placements in which you’d like your ads to appear and in which you wouldn’t.

3.   Budget/ Controlling Spend

Spending in Meta Ads is controlled by setting either a daily or lifetime budget. For example, you could choose a daily budget of $10 to run for the foreseeable future (until you pause or remove the ad) or a lifetime budget of $200 to be spent over the time frame of your choice, such as the next eighteen days.

Budgets are set at the Ad Set level. (Ad sets are where various settings are established in an entity that’s below the campaign in the hierarchy.) There is, however, an option to have the budget set at the campaign level so that it would apply to all ad sets belonging to that campaign. This is called Campaign Budget Optimization (CBO) and can be toggled on in the initial campaign setup panel. CBO can be beneficial if it’s important that your budget all be spent. When using CBO, other ad sets can make up spending if another one isn’t spending much.

The system will attempt to spend your budget evenly over the time in which your ad is scheduled to run, whether that be a daily budget or a lifetime budget, rather than spend it all very quickly. If you’d rather your budget be spent as fast as possible, you can change the delivery type to “accelerated” instead of “standard” in the Optimization and Delivery settings of the ad set.

4.   It’s an Auction-Based System

When and where ads appear to viewers is determined by auction. A complex process looks at various aspects of your ads, as well as those of competing advertisers. An algorithmic formula determines which ads win in an auction and get served and which lose. Several factors determine the placement of the ads, including budget, quality signals received about specific ads, targeting options that were selected, and more. Meta maintains open space in feeds and around other content so that ads can be shown. They are in the business of selling that space, which can also be called their inventory. Ad placements go to the highest (and highest quality) bidders, based on Meta’s formula.

5.   What you get Charged for

Whereas Google Ads typically charges per click on an ad, Meta’s default setting is to charge by impression (meaning an appearance of the ad). You’ll see how much you’re paying in the “CPM” column in the ads interface. (CPM = cost per 1,000 impressions).

There are some campaign objectives (chosen in the initial ad creation process) that allow other options for what you get charged for. In some cases, you can choose to be charged per click, and in others, you can be charged when a certain percentage of a video in an ad has been watched. It’s difficult to say which option is the best, and results would definitely be different on an ad-by-ad basis. Finding out which option is best for you can only be accomplished by testing.

6.   The Quality Factor

As mentioned above, Meta began their advertising/monetization journey by attempting to emulate Google’s. One integral aspect of that was having a built-in way of gauging quality. Higher-quality ads are better than lower-quality ads for everyone involved, including the advertiser, the viewer of the ads, and Meta. When ads are determined to be of higher quality, they receive more delivery and at lower costs. When ads are determined to be of lower quality, they receive less delivery and at higher costs.

To help advertisers maintain quality and relevance in their ads, Ads Manager offers a feature called Ad Relevance Diagnostics. These diagnostics can help you understand if the ads you ran were relevant to the audience you reached. The three types of ad diagnostics are:

Quality Ranking — How your ad’s perceived quality compared to ads competing for the same audience.

Engagement Rate Ranking — How your ad’s expected engagement rate compared to ads competing for the same audience.

Conversion Rate Ranking — How your ad’s expected conversion rate compared to ads with the same optimization goal competing for the same audience.

Ad relevance diagnostics are default columns in the Performance column preset on the ads tab in Ads Manager.