When creating successful advertising campaigns, proper budget management and expenditure are key. Just as we previously outlined the topic of spend limits in Google Ads, today we are discussing its application within the Microsoft Ads platform. In this article, we will look at the limits for “spend” in Microsoft Ads and ways to effectively use them to achieve optimal results.
The basic impulse for understanding the functioning of spend limits in Microsoft Ads is an initial understanding of the types of budgets you can use for campaigns.
Types of Budgets in Microsoft Ads
Within this platform, you can use two types of budgets:
daily
shared
A daily budget ensures that your expenditures are used for optimized performance of your single campaign in relation to your products/services and their availability in the search engine.
A shared budget serves the same purpose as a daily budget, but the difference is that it is not designated for just one campaign. This means that multiple campaigns utilize this common budget.
Spending Limits in Microsoft Ads
Regardless of the type of budget you have chosen, the Microsoft Ads platform will always calculate 2 types of “spending limits”: the monthly budget limit and the actual spending limit for the entire month.
That is why it is important to set a daily “spend” limit, which will help you distribute your financial resources throughout the month. This ensures that you do not exhaust your entire budget on the first day.
When setting your daily “spend” limit, you need to stop and ask yourself two questions:
How many clicks on the advertisement do I expect per day?
How much do I value one click in euros?
By answering them, you will arrive at the expected spending limit that you are willing to use for daily campaign advertising.
Example:
Let’s say you expect 50 clicks per day, valuing each click at €0.20. This means that your daily budget will be €100 (50 x €0.20). Similarly, you can determine that your monthly budget will be €3,040 (daily amount x average number of days in a month, thus €100 x 30.4 days).
If you decide to change your daily limit during the month, your new daily budget will then be multiplied by the number of days remaining in the month.
Exceeding the Spending Limit in Microsoft Ads
It is important to note that your daily limit is just the final value you have set, and your actual expenses will vary in cost. Thus, they are sometimes higher, sometimes lower. These fluctuations depend, for example, on varying levels of user traffic throughout the days of the week.
It is also important to highlight the fact that when your budgeted funds for advertising are spent, campaigns will automatically be paused and will no longer appear in searches. However, there may also be instances of fraudulent clicks. Microsoft Ads anticipates such invalid clicks caused by automated tools or click bots. Therefore, not only does it keep the “spend” overrun under your total daily limit, but it also automatically refunds the money to your campaign in the event of suspected click fraud.
As we mentioned previously with Google Ads, once the daily spending limit is reached (which also means pausing the display of your campaign), your campaign may still receive a few clicks. Although this case is unlikely, the Microsoft Ads platform also addresses it. Thus, if campaign expenditures exceed the monthly limit, the company will refund these overdrawn funds at the end of the month.
Conclusion
For the effective operation of Microsoft Ads campaigns, it is necessary to carefully set daily and thus monthly limits for “spend”. Moreover, the platform ensures through meticulous monitoring of the proper impact of advertising that you do not pay more than originally planned.
