The Billing Event type defines whether Facebook's invoicing is based on each impression served, or each action taken.
- When paying per impression, cost per action is usually lower than or equal to the bid. However, if Facebook predicts the conversion rate wrong, the cost might be slightly higher.
- When paying per action (also known as CPA bidding), Facebook guarantees that the cost per action for you equals your bid amount. However, using this option requires higher minimum daily budgets, and using it on a budget-constrained campaign may result in uneven pacing. Paying per action is best suited for campaigns that are bid-constrained rather than budget-constrained.
- When paying per action, you are moving that risk to Facebook, but in exchange they give you slightly lower delivery volume as they are now more careful on how much you are paying in auction. Paying per action can also result in non-delivery if Facebook is not getting any actions early in the campaign (this is risk management on their end).
- CPA billing is not available for app install campaigns.
Note that in both cases, the costs per action will dependent on the given Conversion Window.
When using Smartly.io Predictive Budget Allocation, we recommend using impressions as the Billing Event. Otherwise, because of the high minimum budgets, it is not always possible to allocate the campaign budget in an optimal way.