ABO vs CBO: How to Maximize Your eCommerce Business’s Paid Social

The advertising reach on Facebook and Instagram is vast; with an estimated five billion users on the platforms, it’s easy to see why. When you’re an eCommerce business owner who needs help determining where to spend your advertising budget, knowing how to leverage Meta Ads Manager effectively can be of huge benefit to your brand.

Besides, getting the most out of your advertising means more than just throwing money into social media ads. While Meta Ads Manager is your starting point for running ads on Facebook and Instagram, understanding the differences between ABO (Ad Set Budget Optimization) and CBO (Campaign Budget Optimization)—and their unique advantages—can significantly impact the success of your paid social campaigns.

In this blog post, you’ll learn the differences between ABO and CBO, how our team uses them to optimize eCommerce brands’ paid social campaigns, and gain some insight into Meta Advantage+ campaigns.

Campaign Budget Optimization: The Main Differences Between ABO & CBO

ABO and CBO are two different Meta campaign budgeting options that give you the flexibility to allocate advertising spend based on specific business goals. ABO, or Ad Set Budget Optimization, enables you to manually allocate spend at the ad set level. Campaign Budget Optimization (CBO), is a method that manages the entire budget at the campaign level using AI. But what exactly does this mean? We’ll explain in more detail below.

Since ABO doesn’t use Meta’s AI to adjust the budget for you, you have the ability to force spend at the ad set level. For example, let’s say you have one ad set of three ads, and you set the spend at $1,500 per day. Two of those ads are performing poorly, and one is doing well. Regardless of the ad that’s performing well, you’re still spending the same amount of money on each ad set ($1,500 daily) regardless of individual ad performance.

However, CBO (now called Advantage Campaign Budget) allows you to manage your budget at the campaign level using AI. Meta automatically distributes ad dollars appropriately based on ad set performance. At Omnitail, we tend to prefer CBO over ABO because it has proven to squeeze more out of budgeted ad dollars and, more often than not, achieves a better return on your investment.

ad set budget optimization (ABO) - Budget allocation / daily spend is the same across all ad sets, regardless of performance. campaign budget optimization (CBO) - Meta AI allocates the budget to the ad set that’s performing the best.

ABO vs CBO: How to Use Meta Campaign Budget Optimization Types Effectively

Benefits of ABO 

One of the main benefits of ABO is that it’s ideal for creative ad testing. Why? Since ABO allows you to manually force spend, you can essentially “pit ad creatives against one another” within a given ad set. This approach allows advertisers to experiment with various audience segments, ad designs, or placements to determine which combination yields optimal results.  Here are two examples to illustrate how you can use ABO for testing: 
  1. Forced Spend Testing. You place two brand-new ads into one ad set. All the variables are the same except the creative. After a few weeks, you conclude which creative performed better by comparing ROAS, conversion rate, and click-through rate. Although this method is not definitive, it tends to be accurate and helps save dollars in the testing budget. 
  2. A/B Testing. If you can afford it, A/B testing will provide definitive results. Take the two ads you had in the forced spend testing example above, and put them into their own ad set. Make sure all variables are the same, and then utilize Meta’s A/B test tool to set your parameters for the test. Upon completion, you will know definitively which ad performs better, and then you can adjust accordingly with these results. Learn more about setting up an A/B test in Meta Ads Manager here.

Other benefits of ABO include:
  • Using a minimal amount of advertising budget for ad testing 
  • Having granular control that allows you to force spend where you want 
  • Testing landing pages, creative formats, copy, and more
  • Targeting distinct audiences or objectives within a single campaign
  • Using the results of your best performing ad set tests and moving them into a campaign that’s using CBO

Benefits of CBO

From our team’s experience, campaign spend gets used most efficiently when you use CBO (now called Meta Advantage Campaign Budget). Why? Because it uses AI. Meta’s AI allocates dollars to the ad set that has proven to achieve the campaign objective. While sometimes it can be wrong, we’ve seen benefits from letting Meta’s AI just “do its thing” because it knows its audience and thus usually performs very well. 

Other benefits of CBO include:
  • Experiencing your desired results with little lift to allocate budget according to performance
  • Saving time because budgets are reallocated automatically
  • Optimal spending across targeting and bidding

Leveraging the Power of Meta Advantage+ Campaigns

Another way to make the most of your paid social advertising budget is to invest in the help of Meta Advantage+ campaigns. These campaigns, which use artificial intelligence and new machine learning models to help you increase sales and drive growth, were first introduced in August 2022. Since then, Advantage+ shopping campaigns have helped advertisers quickly learn what ads are working, and which aren’t, with the updated AI.

Like CBO, this campaign type also spends the advertising budget quite efficiently. The difference between the two is that Meta Advantage+ campaigns are optimized using new machine learning models and are thus “smarter” in comparison. Its enhanced targeting abilities at the ad set level allow you to choose your desired audience, so you can then determine how much budget to spend on that audience (1%, 2%, or up to 100%). This gives you great control to manipulate the campaign; you can make a prospecting campaign with bigger reach by targeting your remarketing audience and your repurchasing audience in one fell swoop.

Key takeaways of Meta Advantage+ campaigns:
  • It’s a hyper-efficient campaign type due to new machine learning models 
  • You can have up to 50 ads in an ad set
  • You can adjust settings to target remarketing, prospecting, and retention audiences all at once
  • It gives you the ability to allocate spend based on your selected audience (1%, 2%, or up to 100%) 
  • Coupons are available to test out Meta Advantage+ campaigns! Just contact your Meta rep for more information.
Pro Paid Social Tip:

Be thoughtful about how you use these campaign options, and make sure to understand their use and purpose before you move forward. Once you do, run all three in your account to reap the benefits and maximize spend.

The Omnitail Difference

It’s easy to pour money into paid ads on social media without fully understanding the impact their performance has on your business. That’s where The Omnitail Difference comes in: A transparent, full-service paid social media agency that focuses not only on paid social media buying, but also on creative strategy and creative ad development. Our unique, multi-faceted approach will scale the success of your campaigns—and your business. Part of our multi-faceted approach includes the use of all three campaign budget optimization types. We utilize ABO for testing, CBO for evergreen campaigns, and Meta Advantage+ for broad targeting and hyper-efficiency.

We are committed to making your paid social media advertising work for you and your bottom line through data-driven and creative strategies, continuous testing and optimization, and honest reporting that measures success through overall profitability instead of vanity metrics like ROAS.

Paid Social Media Advertising That Doesn’t Set & Forget

Deciding on whether to use ABO, CBO (Advantage campaign budget), or Meta Advantage+ campaigns should be driven by your audience’s needs, specific goals, and the resources you have available. When you can understand and effectively utilize the methods to your benefit, you can optimize your paid social strategy to achieve the real results you need. Let our experienced paid social media agency take the burden off and manage your paid social accounts for you. Reach out to us today for more information

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