Ads (7): Why does my daily ad cost sometimes exceed the daily budget?

Key highlights of the article

• What is a daily budget? Can I set it by myself?
• Does the daily budget equal my daily cost?
• How does a daily budget help me control ad costs?
• Why might the daily ad cost exceed the daily budget?
• If the daily cost exceeds the daily budget, will it result in an increase in my monthly advertising
• costs?
• What should I do if the daily cost consistently exceeds the daily budget for days?
• If the total ad costs for the month still exceed the daily budget multiplied by the total number of days, what should I do?

What is a daily budget? Can I set it by myself?

The daily budget is the amount that can be set by the designer. This amount represents the average daily investment that the designer is willing to spend on advertising during the campaign. Setting a daily budget means informing the advertising system about the estimated amount to be spent per day on average during the month, which helps us to manage ad cost wisely.

For example, if my monthly advertising budget is US$300, 
I can set my average daily budget to be US$10, 
which means the total advertising budget of US$300 divided by 30 days equals US$10.

 

Does the daily budget equal my daily cost?

No, the daily budget does not equal the actual daily cost. The actual daily cost may vary due to fluctuations in traffic.

Since ads tools operate on a pay-per-click basis, the advertising exposure received by listing ads and brand ads are entirely free. Ad costs are only incurred when a consumer clicks on the ad and becomes traffic for the designer. Traffic can fluctuate due to various factors, so the actual daily cost may differ. Daily cost may not reach the daily budget during periods of low traffic, while it may exceed the daily budget during high traffic periods.

How does a daily budget help me control ad costs?

When we set a daily budget, we are essentially informing the advertising system about the estimated amount to be spent per day on average during the month. The system then uses this budget to optimize the advertising effectiveness, including actions such as pausing ad exposure when the ad spending approaches the daily budget limit to control costs, or increasing ad exposure during high traffic periods to enhance the chances of generating traffic and sales.

Within this mechanism, there may be days where the daily cost falls short of the average daily budget, while on other days, it may exceed the daily budget. The system strives to efficiently and flexibly utilize the daily budget throughout the advertising period in the ever-changing market trends, assisting the designer in precisely reaching potential customers.

For example, if the daily budget is set at US$10, the overall traffic throughout the month will fluctuate based on consumer demand and platform activities, thereby impacting the daily cost. Consequently, there may be days with higher click traffic and the daily cost could reach up to US$11.35, while on other days, the spending may be below US$10.

The graph below illustrates the trend of actual ad cost with a daily budget set at US$10. The dark blue line represents the daily actual daily cost, and the green dots indicate the actual spending on specific dates. Taking these specific dates as an example, the total daily cost over these 7 days amounts to US$69.94, with an average daily spending of US$9.99, which does not exceed the set daily budget of US$10.

Why might the daily ad cost exceed the daily budget?

The daily ad cost can exceed the daily budget due to various factors, such as fluctuations in advertising traffic, individual click bid settings, consumer demand, market trends, and competitor behavior. The advertising system intelligently adjusts the daily budget based on the advertising status of the designer, aiming to optimize the utilization of the advertising budget.

Typically, during periods with higher traffic and sales opportunities, the daily cost may exceed the average daily budget.

Will I be charged if someone maliciously clicks on my ad?

Every time a consumer clicks on an ad, Pinkoi goes through a sophisticated monitoring system to automatically determine whether the click is a "valid click." If the system detects malicious clicks on the advertised products or if the following situations occur, resulting in a rapid increase in advertising costs, the system will categorize these clicks as "invalid clicks":

1. Purposeful clicking on advertised products with the intention of increasing the ad spending for the shop.
2. Continual clicks generated through tools or programs using automated methods.
3. Repeated clicks within a short period.

Users who maliciously inflate the ad costs for the shop will be blacklisted by the system. For users on the blacklist, all generated clicks will be considered invalid.

When "invalid clicks" occur, they will not be counted again, and the corresponding ad costs will not be included in the billing statement and ad performance. Designers will not be charged for "invalid clicks". 

If the daily cost exceeds the daily budget, will it result in an increase in my monthly advertising costs?

Rest assured that even if the daily cost exceeds the daily budget, the total advertising costs for the month will not increase. The system still strives to keep the overall monthly spending within the total amount calculated by multiplying the daily budget by the total number of days the ads are running.

Since the advertising system settles the advertising costs on a monthly basis, even if there are a few days with higher spending, there will still be days within the month where the advertising costs are below the daily budget. The overall average daily spending for the month will remain within the set daily budget.

 

What should I do if the daily cost consistently exceeds the daily budget for days?

If the daily cost consistently exceeds the average daily budget for multiple days, it indicates that the advertising product is highly popular among consumers and has a strong ability to generate traffic for the brand. The current daily budget may not be maximizing the exposure benefits of the advertising product.

In such cases, it is recommended to consider adjusting the advertising settings based on the system's recommendations. This may involve increasing the daily budget, adjusting the individual click bid, or modifying the number of advertising products to optimize the advertising effectiveness and seize potential sales conversion opportunities for the designer.

 

If the total ad costs for the month still exceed the daily budget multiplied by the total number of days, what should I do?

If the total advertising expenses for the month reach 1.5 to 2 times the daily budget multiplied by the number of days the ads were running, it may indicate an abnormal situation for the advertising campaign. In such cases, please provide the following information:

• Shop name:
• Pinkoi Shop link:
• Type of advertising campaign: Listing ads or Brand ads
• Month of ad costs:
• Screenshots of the advertising expenses or relevant information

Please email those information to [e-mail], and we will conduct a thorough investigation into the designer's situation and provide a response to the designer.