ThriveCo is a cosmeceutical brand offering evidence-based hair and skincare solutions for diverse beauty concerns.
When we run bid cap campaigns on Facebook, we’ve noticed a challenge. We set these campaigns with a specific bid i.e 1.5X of CAC or 2X of CAC, but throughout the day, the cost of acquiring customers (CAC) fluctuates. Sometimes, the CAC is lower, meaning we could potentially get more conversions for less CAC. However, we’ve observed that Facebook doesn’t always spend as much as it could during these periods of lower CAC. This results in missed opportunities to maximize conversions at a lower cost.
We tackled the issue by creating an Hourly bid cap campaign in our account. This clever setup allowed us to adapt our bids based on the changing cost of acquiring customers (CAC) throughout the day. Essentially, when the CAC was lower, we increased our bids, enabling us to spend more budget during these optimal times for acquiring customers. Conversely, when the CAC was higher, we lowered our bids, ensuring we didn’t overspend during less favorable periods
First, we need to find out our hourly Spending in the ad account and purchases per hour, which we can find from our Shopify data.
Once we have that data, we can figure out our CAC for each hour.
Next, we'll combine these hourly CACs using a multiplier to get a blended CAC.
We then find the average of these blended CACs.
This step involves figuring out how much higher or lower each hourly blended CAC is compared to the average. For instance, if the blended CAC for the first hour is 15% higher than the average, that's our bid multiplier.
Now, we calculate the CAC for each hour based on one day click
Finally, we find out our hourly bid value with the help of Base CAC and Bid Multiplier
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