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The ads auction: optimising for the holiday season

by Stephanie Boland

July 23, 2021

In a competitive and high-stake environment like the holiday season, strategy is everything. Here, we take you through the ins and outs of the Facebook auction system, and how it can set your brand up for success.

In today’s buy-and-sell world, there are more and bigger holiday events, with more opportunity, than ever before. Whether it’s Black Friday, Singles’ Day or Prime Day, these events bring in a huge amount of business, with almost six in ten holiday shoppers around the globe buying something during a ‘mega-sales event’ in 20201.

With such a high level of excitement and anticipation circling these moments, brands are getting ready for them earlier and crafting bespoke strategies. Sometimes, the ones that come out on top are those that facilitate continuous learning and optimisation—which is exactly where the Facebook auction system can be leaned on.

Learning on the job

The auction system works by delivering the right ads to the right people. This is especially important around the holiday season as many consumers go into the shopping experience with the intent to buy, but without a specific product in mind. With this delivery system, the hard work is taken care of—that product finds them where they are.

Before delivery, ads exist in what’s called the ‘Learning Phase’. This time period is when the system is exploring how, when and where to better deliver an ad. Only when the expected action rates are stable will it release that ad. Some factors can delay this—running too many ad sets at the same time, setting up too many constraints (audience, placement, budget) and making numerous edits when an ad is still collecting data.

Finding value in creative

To decide which ads to show, the auction system ranks the ads based on the advertiser value and user value. The advertiser value is determined by the bid—how much is willing to be spent to achieve a desired outcome—and the estimated action rates: the likelihood that an impression shown to this person will lead to that outcome. The user value measures how interesting an individual will find the ad.

When it comes to maximising these values and staying competitive in the auction, getting the creative right is crucial. If a brand delivers quality creative, the chances of being noticed and encouraging a reaction are higher. If a brand neglects its creative, the chances are, it will be more difficult for the system to source conversions and necessary to bid higher.

Bidding at the auction

Different bidding strategies correlate to different cost controls. If the priority is to spend the entire budget and maximise the volume of conversions, then lowest cost is the best option. Whereas, if a brand wants to take control, it can add a bid or cost cap.

Cost cap: Allows the delivery to be more flexible because the system ensures the average cost per result stays below a given figure
Bid cap: Restricts the delivery slightly because the system controls the maximum bid that can be used to enter an auction

Whatever your business goal—awareness, acquisitions, transactions—Facebook allows you to pay only for the outcomes you want. By working together to craft a bespoke bidding and budget strategy, we can help you take full advantage of the auction system and optimise the full performance of your holiday campaign.

To find out more about Discovery Commerce for the holiday season, visit our video hub where you can watch a range of videos from Facebook experts.


Discovery Commerce
facebook ads
Ads Auction
holiday advertising