Solved: Best Facebook Ads Strategy with $5/Day Budget

Hi there,

Thanks for reaching out!

Happy to give you some initial thoughts on your situation. It's a common spot to be in – you've got a validated product, a high LTV, but a tiny budget to get the engine started. It's a proper catch-22. You need revenue to increase the budget, but you need budget to generate revenue. Your question about which campaign objective to choose is a good one, but I think we need to zoom out a bit first. The real issue isn't whether to pick 'Leads' or 'Engagement', it's that with a $5/day budget, you're essentially trying to start a bonfire with a single match in the pouring rain.

So, instead of just answering your question directly, I'm going to walk you through a more fundamental strategy. It's a bit of a contrarian approach compared to what you might read online, but in my experience, it's the only one that stands a chance of working when you're starting from this position. We're going to build a system that turns your small budget into a valuable asset over time, rather than just burning it for a handful of clicks.

We'll need to look at the real problem: The Algorithm's Hunger

Since you're a developer, you'll appreciate this. The Meta ads algorithm is a machine learning model. Its single goal is to achieve the objective you give it as efficiently as possible. To learn, it needs data—lots of it. Specifically, it needs about 50 conversion events per ad set, per week, to exit what's called the "Learning Phase".

During this phase, the algorithm is erratically testing different pockets of your audience to figure out who is most likely to convert. Performance is unstable, and costs are high. Only after it gets those 50 conversions does it have a clear picture and can start delivering results more predictably and efficiently.

Let's do the maths. At $5 a day, you're spending $35 a week. If a lead costs, let's be optimistic and say $5, you're getting 7 leads a week. That's nowhere near the 50 the algorithm needs. It will be permanently stuck in the "Learning Limited" phase, burning your money inefficiently and never truly optimising. This is the core reason why running a Leads or Conversion campaign on such a small budget is almost always a waste of money. You're simply not feeding the machine enough data for it to do its job.

The "Engagement Campaign" Trap

Now, onto your other idea: running an Engagement campaign first to "warm up the algorithm". This is one of the most persistent and damaging myths in paid advertising. When you tell Meta you want 'Engagement', its algorithm diligently goes out and finds you the people within your target audience who are most likely to like, comment, and share. These are often called "click-happy" users.

Are these the same people who will go through a slow onboarding process for a SaaS product and eventually become a high-LTV customer? Almost never. You are actively training the algorithm on the wrong user behaviour. You're telling it "find me people who click the like button," and it does its job perfectly. When you then switch that campaign to a 'Leads' objective, the algorithm is starting from scratch. The previous data is irrelevant because the success signal was completely different. You haven't warmed it up; you've just spent a few weeks and your limited budget paying Meta to find you the worst possible prospects for your actual goal.

Here's a simple way to visualise the cost difference and why the algorithm behaves this way.

As you can see, the cost to reach someone is tiny. The cost to get a click is higher. The cost to find someone who actually converts is significantly higher. By choosing the 'Engagement' objective, you are simply asking for the cheapest possible actions, which are almost never the profitable ones. So, we need a different plan entirely.

I'd say you need to define your customer by their pain

Before you spend another dollar, you need to stop thinking about your customer in terms of demographics and start thinking in terms of their nightmares. This is the absolute foundation of any successful ad campaign, especially for a B2C SaaS product for communities. "Community manager" is a job title; it's not a pain point.

Your ideal customer isn't just a person; they're in a specific, urgent, and expensive problem state. What is that for your users?

• -> Is it a creator with 10,000 followers who's terrified of their community dying because their Discord server is a chaotic mess of unread messages and spam?
• -> Is it a course instructor who's losing members because their Facebook Group offers a terrible user experience and they can't effectively monetise their content?
• -> Is it a non-profit organiser who's failing to engage volunteers because they're trying to manage everything through scattered email threads and spreadsheets?

These are nightmares. They are career-threatening, revenue-killing problems. "Needing community software" is a bland feature search. "My community is dying and taking my income with it" is a hair-on-fire emergency. Your entire marketing strategy must be built around solving that emergency.

Once you've isolated that specific nightmare, you can find these people. Where do they hang out online? They probably aren't searching for your brand name. But they are:

• -> Following people like Pat Flynn or Roberto Blake on social media (if they're creators).
• -> Members of Facebook Groups like 'SaaS Growth Hacks' or 'Creator Economy'.
• -> Using tools like Teachable, Kajabi, or Circle.so (your competitors!). These are all targetable interests on Meta.

This research isn't just a 'nice to have'; it is the only way to make a small budget work. You can't afford to show your ads to a broad audience. You must be surgically precise, and that precision comes from understanding their pain, not their age or location.

You probably should craft a message they can't ignore

Once you know their pain, you can write ad copy that feels like you're reading their mind. Generic copy that talks about your 'features' will be ignored. You need to speak directly to their problem. The best framework for this is Before-After-Bridge.

Before: Paint a vivid picture of their current nightmare.
After: Show them the dream scenario, the world where their problem is solved.
Bridge: Position your SaaS as the clear, simple path from the nightmare to the dream.

Let's take the example of the creator with the chaotic Discord server:

Bad, Feature-Based Ad Copy: "Our community platform has advanced moderation tools, event scheduling, and analytics. Sign up today!" (This speaks to no one).

Good, Before-After-Bridge Ad Copy:

(Headline): Your Discord is Chaos. Here's the Fix.

(Body): "Another notification. You check your server and it's 100+ unread messages, half of them spam. Your most valuable members are silent, and you're worried they're about to leave. (Before)

Imagine a community where every conversation is organised, valuable members are leading discussions, and your events are packed. You're not just a manager; you're the leader of a thriving digital home. (After)

Our platform is the bridge. We turn chaotic servers into engaged, profitable communities in under an hour. Stop fighting the algorithm and start building your legacy. Try it free. (Bridge)"

See the difference? The second ad isn't selling software; it's selling relief from a specific, painful situation. This is what gets clicks from the *right* people, even on a small budget.

We'll need to look at your offer (and why a Messenger chat is a mistake)

This brings me to your chosen CTA: a Messenger conversation. For a B2B high-ticket service, this can work. For a B2C SaaS, it's a huge point of friction and a strategic error. It's the equivalent of a "Request a Demo" button for a consumer product. It's arrogant.

You're asking a potential user, who is likely a busy creator or solo entrepreneur, to stop what they're doing and commit to a real-time conversation just to learn about your product. They don't want to be sold to; they want to solve their problem. The highest-value action you can offer is to let them experience the solution for themselves, instantly.

Your offer’s only job is to deliver an "aha!" moment of undeniable value. For a SaaS product, the gold standard is a free trial or a freemium plan. No credit card required. Let them get their hands on the product and see for themselves how it solves their pain. When the product itself proves its value, the sale becomes a formality. You'll generate Product Qualified Leads (PQLs) who are already convinced, instead of unqualified chat leads you have to spend time persuading.

I remember one software client we worked with who made this exact shift. Once we moved their focus from conversations to a frictionless free trial and built the campaigns around that clear conversion goal, we were able to generate over 5,000 trial sign-ups for them on Meta Ads at just $7 per trial. That's the kind of result that becomes possible when you remove friction and give the algorithm a clear, valuable goal to optimise for.

You absolutely must remove this friction point. Your primary CTA should be a completely free, no-strings-attached trial. It's the fastest path from their pain to your solution.

I'd say you need to understand your numbers

You mentioned your LTV is high, which is fantastic. But do you know exactly *how* high? Understanding this number is what separates amateur ad spenders from professional growth marketers. It tells you exactly how much you can afford to spend to acquire a customer (your Customer Acquisition Cost, or CAC).

Let's break it down. You need three numbers:

1. Average Revenue Per Account (ARPA): How much you make per customer, per month.
2. Gross Margin %: Your profit margin on that revenue.
3. Monthly Churn Rate: The percentage of customers you lose each month.

The calculation is: LTV = (ARPA * Gross Margin %) / Monthly Churn Rate

A healthy business aims for an LTV to CAC ratio of at least 3:1. This means for every £1 you spend to acquire a customer, you get £3 back in lifetime profit. Use the calculator below to see what this means for you. Adjust the sliders to match your business metrics.

When you do this math, you'll likely discover you can afford to pay a lot more than you think for a customer. This frees you from the tyranny of cheap leads and lets you focus on acquiring high-quality users. But it also highlights the problem: your $150/month budget might not even be enough to acquire ONE customer, let alone the 50 conversions the algorithm needs to learn.

This is why we need a completely different strategy.

You'll need a new strategy for that budget: Asset Building

Okay, so direct conversion campaigns are out. Engagement campaigns are a waste. What's left? You need to shift your mindset from *acquiring customers* with your budget to *building an asset*. That asset is a high-quality, warm retargeting audience.

Here's the two-stage plan:

Phase 1: Build the Audience (Your $5/day Campaign)

1. Create a Value-First Content Piece: Don't send traffic to your homepage. Create a genuinely useful blog post, a short video tutorial, a downloadable checklist, or a free guide that solves a *small, specific part* of your ICP's big nightmare. Examples: "The 5-Minute Checklist for a Less Chaotic Discord Server," "3 Ways to Re-engage Silent Members in Your Facebook Group," or "How to Host Your First Virtual Community Event."
2. Run a Traffic Campaign: Set up a new campaign with the "Traffic" objective. But here's the crucial part: in the ad set settings, optimise for Landing Page Views, not Link Clicks. This tells the algorithm to find people who not only click but also wait for your page (with the Pixel) to load. It's a much higher-quality signal.
3. Target Surgically: Use your ICP pain-point research to build your audience. Target interests related to competitor tools, industry influencers, and relevant behaviours. Your ad copy (using the Before-After-Bridge) will call out to these people.

The goal of this phase is NOT to get sign-ups. It is to get the cheapest possible, high-quality traffic to your content. A landing page view might cost you £0.20 - £0.50. With $5 a day (£4), you could be adding 8-20 highly relevant people to your website's custom audience every single day. In a month, you could have an audience of 240-600 people who know who you are and have recieved value from you.

Phase 2: Convert the Audience (When you have a bit more budget)

1. Build a Custom Audience: In Meta's Audience Manager, create a custom audience of everyone who visited that specific content page in the last 30-90 days.
2. Run a Conversion Campaign: Once that audience has at least 500-1000 people in it (this might take a month or two), you can launch a *separate* campaign with the 'Conversions' objective (optimising for your 'Free Trial' sign-up).
3. Target ONLY the Warm Audience: Your ad set will target only this custom audience. You are now speaking to people who are problem-aware and solution-aware (because you've already helped them).
4. Make a Direct Offer: Your ad copy can now be more direct. "Enjoyed the Discord checklist? See how our platform automates the entire process. Start your free trial and get your community organised in the next 10 minutes."

This approach works because it aligns with your budget. You use the cheap objective (Traffic) for the expensive part (cold outreach) and the expensive objective (Conversions) for the cheap part (targeting a warm, receptive audience). You are building a valuable asset—a list of pre-qualified, interested prospects—that you can market to over and over again. It's slower, but it's capital-efficient and it actually works.

This is how I would structure it...

Here’s a visual representation of how this two-stage campaign funnel works. It’s a simple but powerful system for turning a small budget into a predictable stream of leads over time.

I've detailed my main recommendations for you below:

To make this as actionable as possible, here is a step-by-step plan. This is the exact process we would use for a client in your position. It requires patience, but it builds a sustainable foundation for growth rather than gambling on short-term results.

I know this is a lot to take in, and it's a very different approach from the quick-fix advice you often see online. But the reality of paid advertising in 2024 is that you can't defy the logic of the algorithms or the market. Trying to force direct conversions with a tiny budget is a recipe for frustration and wasted money. It's a tough pill to swallow but it's the truth.

By taking this more patient, strategic approach, you stop gambling and start investing. You use your small budget to build a tangible asset that will pay dividends for months to come. You'll gain valuable insights about what messaging resonates with your audience and build a pipeline of warm leads who are far more likely to convert when you do ask for the sale. This is how you build a real, sustainable growth engine for your SaaS, even when you're starting small.

Running campaigns like this, with multiple stages and careful strategic planning, can be complex. It involves deep research, compelling copywriting, technical setup, and constant monitoring. Many founders find it's more effective to focus on their product while having an expert manage this process for them. If you'd like to discuss how we could implement a strategy like this for your business in more detail, we offer a free, no-obligation initial consultation where we can review your specific situation and map out a tailored growth plan.

Regards,

Team @ Lukas Holschuh