ABO vs. CBO Campaign Type: What’s the Difference on Facebook Ads?

What is ABO? (Ad Set Budget Optimization)

ABO stands for Ad Set Budget Optimization.
This means you, the advertiser, determine the budget for each ad set in your Facebook campaign, independently—as opposed to the entire campaign.
To compare it to practical real life, it’s like each ad set has its own bank account. You fund each ad set with a certain amount of cash. Facebook does not move money around from one bank account to the other. It uses exactly what you give to each one and it will not determine what it should have based on how well the asset is performing (or not). If it gets $50 and it should have gotten $200, too bad. It only gets $50.
🎯 When to Use ABO:
Use ABO when you require specific control over your budget distribution. For example

• You’re split testing various audiences and you want to ensure that each one gets a fair chance.
• You don’t want Facebook to spend all your budget on one ad set, at this time, just because it decided that’s the better option.
• You have a cold traffic test and it’s too early to tell which ad set is actually performing better.

With ABO, the ball’s in your court. You get to decide who gets budget, how much budget, for how long.
But keep in mind that with power comes great responsibility. If one ad set is absolutely crushing it while another one’s slacking, Facebook won’t take it upon itself to reallocate budget after the fact—you have to do it yourself.

What is CBO? (Campaign Budget Optimization)

CBO stands for Campaign Budget Optimization.
With a CBO campaign, you set one budget at the campaign level and the Facebook algorithm decides how to best spend that budget across your different ad sets based on performance.
Instead of allocating a separate budget to every ad set, you give Facebook the option to spend more on what’s working and scale back on what isn’t.
It’s like telling Facebook:
“Give you this amount of money and figure out how to make it work.”

When to Use CBO:
CBO is best used when:

• You’re not testing any new audiences; you’ve tested audiences in the past and know they convert well.
• You want the system to figure it out and optimize itself in real time.
• You’re in a scaling phase and performance needs to stay consistent without direct involvement.

CBO works best when Facebook knows your audience from previous purchases. If you’re scaling a previously successful campaign, CBO spends your budget the most effective way for CBO to get the highest ROI.
But it can be risky if you’re testing new ads—because if one ad set begins to perform just slightly better, Facebook will put all the money there even if other ad sets didn’t have time to reflect their potential.
 
🎬 ABO vs. CBO: Which One Should You Use?
Final thoughts:
Test with ABO. Scale with CBO.
ABO gives you control and better distribution and testing makes sense when exploring new audiences, new creatives or angles. Always switch to CBO after testing so Facebook can learn and budget more accordingly to the proven winners in a quicker scaling fashion.
This is how a dropshipping operation would integrate the workflow:

• Use ABO first and test 3-5 different audiences or different creatives.
• Use ROAS, CTR, CPA or any other performance metric to determine a winner.
• Use CBO to scale in an efficient, aggressive manner with only the winners.

That’s the beauty of knowing when to choose one over another. They complement each other perfectly.

Control versus Automation
Choosing ABO vs. CBO comes down to this: Are you willing to relinquish control or do you have enough trust in Facebook’s algorithm to do the work for you? When you’re testing something new, launching an offer—you need control—because the nuance/deviation does not exist yet. When you’re scaling something that you know already works, then automation. Let it do it for you.

🚀 Final Thoughts: Use Both but Use Them Intelligently
So what’s the solution? There is none. Savvy marketers don’t stick with ABO or CBO—they use both depending on what time of testing and scaling they’re doing.

• They use ABO for organization, leveling the playing field for testing and more control.
• They use CBO for scaling needs and allowing Facebook to optimize spend more readily.

The knowledge of when and how will make you better than the rest—especially in today’s competitive market where profit margins are already low and time to test dwindles ever faster.
Want to see examples of campaigns that only used one or used both? Need a flow chart of when to use what? Let me know and I’d be happy to provide.