An Ultimate Guide For TikTok ABO vs CBO

Campaign budget optimization (CBO) vs. automated bidding on TikTok: which is better? Both have their advantages and disadvantages, and there is no universal solution that works for every single TikTok advertisement. However, different types of campaigns and goals call for different budgetary approaches. As a result, TikTok advertisers need to decide whether to use ABO or CBO strategies.

In the following article, our House of Marketers team discusses how to determine which strategy is best for your campaign goals and at what points in the campaign’s lifecycle.
Over 17.9% of all adults online are exposed to TikTok ads. This staggering number demonstrates how pivotal TikTok has become as an advertising medium. In addition, the average engagement rate on TikTok is between 5 and 16 percent. This dramatically outperforms even the most popular social media sites.

Capitalizing on high engagement rate is crucial to the success of any campaign, and ABO and CBO are two viable strategies for doing so.

What’s the Difference Between ABO and CBO on TikTok?

Advertising campaigns on TikTok can make use of either Ad Group Budget Optimization (ABO) or Campaign Budget Optimization (CBO) as methods of allocating their budgets.

The term “ABO Campaign” refers to TikTok’s Ad Group Budget Optimization feature.
To manage costs per ad group, set up an ABO campaign. You can set individual ad group budgets independently of the overall campaign budget. In ABO campaigns, the minimum daily budget per ad f is $20/£20.

In the world of TikTok, what exactly is a CBO Campaign (Campaign Budget Optimization)?
On the other hand, CBO campaigns let you allocate funds for the entire effort. After that, an algorithm on TikTok will decide how your money is best spent among your various ad segments. When running a CBO campaign, you have no say over how much money is allotted to each ad group. In CBO campaigns, a daily budget of at least $50 (or £50) is required.

Which option should you pick?

The success of your campaign in generating conversions or engagements may hinge on whether you use ABO or CBO. Most marketers get flustered trying to figure out which option will serve their purposes the best.
Ad Group Budget Optimization Explained.

Choose Ad Group Budget Optimization for your TikTok ad campaign and you’ll be able to set a specific amount of money aside for each ad group. If your total advertising budget is $100, you may decide to split that amount evenly between Groups A and B. Group A could consist of young men (18-24) who are passionate about sports, while Group B could include women (25-34) who are interested in exploring the world.

With ABO, you can manage your advertising budget with precision. It also guarantees that everyone will get their fair share of the money you have set aside.

What exactly is the optimization of a campaign’s budget?

AI and algorithmic marketing technology have made possible a newer type of budgeting known as “campaign budget optimization,” which was previously impossible. Your entire campaign can be managed within your set budget with CBO. After that, TikTok’s algorithm will divide your advertising budget among your intended audiences mechanically, taking into account a wide range of factors. Engagement and conversion rates are included.

Should You Go with a CBO or an ABO?

Now that more members of Generation Z are using TikTok than Instagram, businesses can reach this valuable demographic if they can figure out how to allocate their advertising dollars wisely. Have you been pulling out your hair trying to figure out which of ABO and CBO is better? You have company. It’s a difficult choice with no clear solution. But there are things to think about that could aid in decision-making. Let’s compare and contrast the benefits and drawbacks of each tactic:

Optimizing advertising spending can save money

Many marketers are already comfortable with this type of budgeting because of its long history.
You can maintain full command over your advertising budget. You have complete knowledge of the sums being distributed to each category. You can make adjustments at any time without jeopardising the success of the marketing campaign.
For retargeting campaigns with a limited budget, this method can help you zero in on specific groups of site visitors or video viewers.

Optimization of the Campaign Budget (CBO)

In terms of campaign budgeting, this approach is highly effective. You can set a monthly spending limit, and TikTok’s algorithm will find the best way to spend that money.
Since the same amount of money can be spent on each audience in an A/B test, the results are much more reliable. You should know that the TikTok A/B testing campaign objective has some restrictions.
You can avoid a lot of unnecessary work and work time by using it. The algorithm will automatically track the progress of each section, relieving you of that responsibility.

Which Side Do You Take?

When it comes to advertising online, no matter how simple it seems, there is always more than meets the eye. If you’re not sure whether ABO or CBO will yield better results for your campaign, testing both is your best bet. Don’t forget that there are a lot of variables that can affect the outcome. Your campaign’s aims, intended audience, and ad quality should all be included here. Some advertisers choose to use ABO for preliminary research before switching to CBO for widespread rollout of successful ad groups. In this way, they can have the best of both worlds. First, they have the granularity to adjust their budget with ABO, and then there’s the potential for growth with CBO.

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