As you can probably tell, Facebook has a lot of users and this creates a lot of ad inventory. After all, when a user loads many different pages as they check out different types of content on Facebook, these pages can be used to show ads. This is what makes up Facebook’s ad inventory.
Bidding System
Facebook will look at your targeting criteria and match it up with all the other targeting criteria of other advertisers. Once they find advertisers targeting the same type of people, they would then look at what is the maximum amount of money you’re willing to spend for every click. These are then compared against other bids in a real time auction that plays out every single second.
The good news? You may be outbid for ad inventory, but there’s a daily spending cap. So, if your competitor already maxed out on their ad spend, technically speaking, your cheaper ads could show up.
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