Important Facebook Ads Settings Explained: What They Mean and Why They Matter

Facebook Ads can be an incredibly powerful marketing tool for small businesses, but only if they are set up correctly. Many business owners jump straight into running ads without configuring the right settings, leading to wasted ad spend, poor targeting, and inaccurate tracking. Understanding these settings ensures that you are maximizing your budget, optimizing your campaigns, and reaching the right audience with the right message.

This guide breaks down the most important Facebook Ads settings, what they mean, and why they matter, so you can make smarter ad decisions and drive better results.

1. Facebook Business Portfolio vs. Ads Manager: Understanding the Difference

Facebook Business Manager

A centralized dashboard where businesses manage multiple ad accounts, Pages, team permissions, and payment settings in one place.

Why It Matters:

• Keeps your business assets secure by separating personal and business activities.
• Enables you to grant access to team members without sharing login credentials.
• Allows you to manage multiple Pages and ad accounts in one place.

Facebook Ads Manager

The platform where you create, manage, and track Facebook and Instagram ad campaigns.

Why It Matters:

• Provides advanced options for budgeting, targeting, and reporting.
• Gives access to detailed performance data to optimize your ads.

Pro Tip: Always set up a Business Manager account first before running ads to maintain control over your assets and prevent potential security issues.

2. Facebook Pixel (Meta Pixel) & Conversion API: Essential Tracking Tools

Facebook Pixel

A small snippet of code added to your website that tracks visitor behavior and conversions, such as purchases, sign-ups, and cart abandonment.

Why It Matters:

• Enables retargeting ads to users who have already interacted with your site.
• Helps optimize ads by feeding Facebook valuable conversion data.
• Allows you to track ROAS (Return on Ad Spend) to measure profitability.

Conversion API (CAPI)

A server-side tracking tool that sends customer data directly from your website or CRM to Facebook, reducing reliance on cookies and improving data accuracy.

Why It Matters:

• More accurate tracking in a world with increasing privacy restrictions.
• Works alongside the Pixel to track conversions even if users have ad blockers.

Pro Tip: Use both the Facebook Pixel and Conversion API together for the most reliable conversion tracking.

3. Ad Account Settings: The Basics You Can’t Ignore

Payment Method & Billing Threshold

Facebook Ads operates on a pay-as-you-go system, charging you based on your billing threshold. Just a quick note here, you don’t have control over your threshold. Facebook automatically sets it and it starts low and as you prove that your reliable for payment it will increase.

Why It Matters:

• Ensures your ads don’t pause unexpectedly due to payment failures.
• Helps manage cash flow and ad budget more effectively.

Pro Tip: Set a backup payment method to prevent ad disruptions.

4. Campaign Settings: Choosing the Right Objectives & Bidding Strategies

Campaign Objectives: Setting the Right Goal

When creating an ad campaign, Facebook requires you to choose an objective. The three main categories are:

Why It Matters:

• Your objective determines how Facebook optimizes ad delivery.
• Choosing the wrong objective can result in poor performance and wasted budget.

Bidding Strategies: Controlling Ad Costs

Facebook offers different bidding strategies based on campaign goals:

• Lowest Cost (Auto-Bidding): Facebook optimizes for the most results within your budget.
• Cost Cap: Controls your average cost per action.
• Bid Cap: Sets a strict maximum bid amount.

Why It Matters:

• Choosing the right strategy helps balance cost-efficiency and ad performance.
• Auto-bidding is best for beginners, while Cost Cap works well for businesses wanting stable CPAs (Cost Per Acquisition).

5. Audience & Targeting Settings: Reaching the Right People

Custom Audiences

Allows you to target users based on existing customer data, website visitors, or engagement.

Why It Matters:

• Retargets users who already know your business, increasing conversion rates.
• Helps re-engage past customers with special offers.

Lookalike Audiences

Facebook identifies people similar to your existing customers and creates a new audience with shared characteristics.

Why It Matters:

• Expands reach to high-potential customers.
• Works best when using high-quality Custom Audience data.

Interest & Behavior Targeting

Facebook allows you to target users based on:

• Interests (e.g., fitness, travel, fashion)
• Behaviors (e.g., frequent travelers, online shoppers)
• Demographics (e.g., age, location, job title)

Why It Matters:

• Ensures your ads are shown to the right people instead of a broad, uninterested audience.

6. Ad Placement & Optimization Settings

Automatic vs. Manual Placements

Facebook allows advertisers to choose where ads appear:

• Automatic Placements: Facebook optimizes delivery across all platforms.
• Manual Placements: Advertisers manually select where ads show (e.g., Facebook Feed, Instagram Stories, Messenger, Audience Network).

Ad Delivery Optimization

Determines how Facebook shows your ads based on the objective chosen:

• Conversions: Optimizes for users likely to take action.
• Link Clicks: Focuses on users likely to click the ad.
• Engagement: Shows ads to users most likely to like, comment, or share.
• Landing page views: Facebook will prioritize showing your ads to people within your target audience who are most likely to click your ad and then wait for your landing page to fully load

Why It Matters:

• Setting the wrong optimization method can lead to wasted ad spend.
• Optimizing for conversions (instead of clicks) results in higher-quality traffic.

Final Thoughts: Setting Up Facebook Ads the Right Way

Configuring your Facebook Ads settings properly ensures efficient spending, accurate tracking, and higher ad performance. From installing the Facebook Pixel and setting up conversion tracking to choosing the right audience and bidding strategy, every setting plays a role in your campaign’s success.

By understanding these settings, you gain more control over your ad performance and budget, allowing you to make data-driven decisions that drive real business results. If you’re unsure how to set up your Facebook Ads correctly, I can help optimize your campaigns and ensure you’re making the most of your advertising budget!