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Budget Distribution Between the Funnel Stage

DimNiko - Budget allocation in funnel

The optimal budget allocation between funnel steps is a real challenge for all Facebook marketers.

The wrong decision can significantly impact your ROI and CPA.

But the right decision can boost your performance and as we know only sky’s the limit.

So today I would like to tell you what is the right decision from my experience.

Two weeks ago I wrote a case study on how I scaled an account from 2k to 20k daily spend.

And of course the main traffic was coming from the prospecting campaign.

But it is very important to remember that when you’re scaling the prospecting traffic,

The retargeting traffic should be scaled as well.
Let’s jump into the numbers from here.

So let’s imagine you have a prospecting campaign with a $1000 daily budget.

How much should you spend on retargeting in this case?
My experience based on multiple tests shows that the right decision is 30%.

I would spread these $300 between the Middle and Bottom of Funnel.

$200 for the Middle and $100 for the Bottom.

This is my recipe of a healthy and strong budget distribution.

Now imagine your prospecting campaign is performing amazingly and you start increasing the budget.

In a week or so you start spending $3k per day on your TOF campaign.

But you’re still spending only $300 on retargeting.

In this case you will be missing out on all those additional potential customers

Who got engaged with your ads but didn’t purchase.
So obviously you will have to increase the retargeting gradually,

Depending on how much you increased the prospecting traffic.

At $3k on TOF, I would put $600 on MOF and $300 on BOF.
Now let’s imagine another situation:

The results of your prospecting campaign are very expensive but the retargeting is in the benchmarks.

So you start increasing the retargeting budget and at some point the ROAS drops a lot.

You stop getting those amazing numbers.

Why is that?

The answer is very simple: now you’re not filling the retargeting with enough traffic.

Even though the prospecting is expensive, you have to increase the budget there as well.

Otherwise you won’t just have potential customers at the Bottom of your funnel.

Maybe your product is typically bought from the second or third engagement.

That’s totally fine but you need the customer to get to this step of the funnel in order to retarget.

That’s why spending 70% on the prospecting and 30% on the retargeting is the right decision in terms of budget allocation.
In case you want to learn about other decisions we’re making in the agency

And if you’re spending over $500 a day

And also want to scale your brand

Book a call below:

https://dimniko.com/msp-apply

Thanks!

Maryana from DimNiko 🙂

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