Hi there,
Thanks for reaching out! Happy to give you some of my initial thoughts on your questions about scaling ad spend and those pesky new account limits. It's a common place to be in, and the answer isn't quite what most people expect.
The short version is that scaling ads isn't a simple case of 'put more money in, get exponentially more sales out'. It's a game of diminishing returns. And as for the spend limit, that's just Facebook's way of making sure you're legit – it's annoying, but it'll pass with time and good behaviour.
I've broken down my full thoughts below, including how to think about scaling properly and what you can actually do to grow past these early stages. Hope it helps.
TLDR;
- No, conversions don't rise exponentially with spend. In fact, the opposite happens. You'll hit a point of diminishing returns where your cost per conversion (CPA) starts to climb as you reach less interested people.
- The Facebook spend limit is normal for new accounts. It's an automated fraud prevention measure. To get it lifted, you need to consistently spend your budget, pay your bills on time, and avoid ad disapprovals. There's no magic button, it just takes a bit of time.
- Stop guessing your budget. Calculate your LTV. The most important number you need to know is your Customer Lifetime Value. This tells you exactly how much you can afford to spend to acquire a customer. I've included an interactive calculator below to help you figure this out.
- Scaling isn't about spending more, it's about spending smarter. You need to systematically test new audiences, improve your ads, and optimise your website to lower your CPA. This is how you unlock real growth, not just by throwing more money at the problem.
- Awareness campaigns are a trap. You're paying Facebook to find the worst possible audience for your product. To get actual customers, you MUST optimise for conversions like leads or sales from day one.
The Myth of Exponential Growth: Why More Spend Doesn't Mean More Sales
Alright, let's tackle your first question head-on, because it's the biggest misconception in paid advertising. Do conversions rise exponentially when you spend more? In a word: no.
It feels like they should, right? You spend €50 and get 5 sales, so you assume spending €500 will get you 50 sales. Unfortunatly, it just doesn't work that way. What you actually experience is the law of diminishing returns. Initially, as you increase your budget, your conversions will probably go up nicely. Facebook's algorithm is smart; it goes after the 'low-hanging fruit' first – the people within your audience who are most likely to convert.
But that pool of eager buyers is finite. As you keep spending, the algorithm has to work harder. It starts showing your ads to people who are a bit less interested, then people who are only vaguely curious, and eventually people who couldn't care less. Each new conversion becomes more difficult, and therefore more expensive, to get.
So, your total conversions might still go up, but your Cost Per Acquisition (CPA) will also start to creep up. Spend too much too quickly, and that creep becomes a rocket launch. This is what we call 'audience saturation'. You've exhausted the best part of your audience, and now you're just paying more and more for lower-quality attention. This is a totally normal part of scaling any software or ecommerce campaign, I see it all the time. The trick is knowing how to manage it.
I'd say you need a better metric: The Math That Unlocks Real Growth
So if you can't just spend more, what do you do? You get smarter. The real question isn't "How much should I spend?" but "How high a Cost Per Lead can I afford to acquire a truly great customer?" The answer to that is a little metric called Lifetime Value, or LTV.
Forget your daily ad spend for a second. Your LTV tells you how much profit a single customer will bring you over their entire relationship with your business. Once you know this number, everything else falls into place. You stop worrying about a €50 CPL and start thinking about whether that €50 is buying you a customer worth €5,000.
Here's the basic math:
LTV = (Average Revenue Per Customer * Gross Margin %) / Monthly Churn Rate
Calculating this properly is probably the single most valuable excercise you can do for your business. It turns advertising from a guessing game into a predictable investment. To make it easier, I've built a little calculator for you. Play around with the sliders to see how small changes in your business metrics can dramatically change what you can afford to spend on ads.
You'll need to stop paying Facebook to find Non-Customers
Here’s another uncomfortable truth. If you're running campaigns with an objective like "Reach" or "Brand Awareness," you are literally paying Facebook to find you the worst possible audience.
When you give the algorithm that command, it does exactly what you ask: it finds the largest number of people for the lowest possible price. And who are those people? They're the ones who are least likely to click, least likely to engage, and absolutely, positively least likely to ever buy anything. Their attention is cheap because no other advertiser wants it. Tbh it's a trap for beginners.
The best brand awareness you can get is a happy customer. That only comes from conversions. Awareness is a byproduct of selling a great product, not a prerequisite for making a sale. From day one, your campaigns should be set to a conversion objective, whether that's sales, leads, signups, whatever. This tells the algorithm to hunt for people who actually take action, not just ghosts who scroll past. I remember one campaign we worked on for a medical job matching SaaS client; we took their cost per user acquisition from £100 all the way down to £7 just by restructuring their campaigns to focus purely on conversions and optimising the funnel.
You probably should be testing audiences methodically
So, how do you find new pockets of customers without your CPA going through the roof? You test. Not randomly, but with a structure. This is how we approach it for pretty much every account, wether it's ecommerce or B2B software.
You need to think of your audiences in a funnel:
- Top of Funnel (ToFu): These are cold audiences, people who've never heard of you. You start here. For a new account, this means testing detailed targeting (interests, behaviours). Think about what podcasts your ideal customer listens to, what software they use, which influencers they follow. Get specific. "Marketing" is a bad interest. "HubSpot" or "SaaS Growth Hacks Facebook group" is much better. Once you have enough data, you can test lookalike audiences based on your best customers.
- Middle of Funnel (MoFu): These are people who've shown some interest but haven't taken a key action. They've visited your website, watched a part of your video ad, or engaged with your Instagram page. You run specific campaigns to nudge them further down the path.
- Bottom of Funnel (BoFu): This is the money pot. These are people who've added a product to their cart, initiated checkout, or visited your pricing page. They are red hot. You retarget them with ads that overcome objections, offer a small incentive, or remind them what they're missing out on.
You need seperate, long-term campaigns for each stage of this funnel. Inside each campaign, you test different audiences against each other. The ones that don't work get turned off. The winners get more budget. It's a process of constant refinment and discovery.
We'll need to look at that Ad Spend Limit...
Finally, let's talk about that €47.77 daily spend limit. This is completely normal and happens to every single new ad account. It’s Facebook’s automated system trying to prevent scammers and fraudulent activity. They want to see a pattern of legitimate, consistent behaviour before they trust you with more money.
There is no secret trick to get it lifted faster. You can't call someone or fill out a form. The only things you can do are:
- Spend your full daily budget consistently. Show the system you're serious and will use the budget they give you.
- Pay your bills on time. This is a big one. Set up a reliable payment method and make sure it never fails.
- Follow the rules. Avoid getting your ads rejected. Read the ad policies. Too many rejections is a massive red flag for their system.
After a few weeks (sometimes longer) of this good behaviour, the system will automatically start increasing your limit. It'll happen in stages. It's a pain, but you just have to be patient and prove you're a trustworthy advertiser. Everyone has to go through it.
This is the main advice I have for you:
To wrap things up, here's a summary of the actionable steps you should be taking based on everything we've talked about. This is the framework for moving from simply 'spending money' to 'investing in growth'.
| Problem Area | Recommendation | Why It Matters |
|---|---|---|
| Scaling Mindset | Stop thinking about exponential growth. Embrace the concept of diminishing returns and focus on improving your CPA, not just increasing spend. | This prevents you from burning cash chasing impossible returns and forces you to build a more efficient, sustainable advertising machine. |
| Budgeting | Calculate your Customer Lifetime Value (LTV) using the calculator above. Use a 3:1 LTV to CAC ratio to set your maximum allowable cost per acquisition. | This gives you a data-driven budget, removing guesswork. You'll know exactly how much you can afford to pay for a customer and still be profitable. |
| Campaign Objective | Immediately switch all campaigns to a 'Conversions' objective (e.g., Sales, Leads). Never use 'Reach' or 'Brand Awareness' for direct response. | You'll be telling Facebook's algorithm to find people who actually buy things, not just cheap impressions, which drastically improves the quality of your traffic. |
| Audience Targeting | Implement a structured ToFu/MoFu/BoFu testing framework. Start with specific interest targeting and build out retargeting and lookalike audiences as you gather data. | A systematic approach is the only way to consistently find new, profitable audiences and scale your campaigns beyond the initial low-hanging fruit. |
| Spend Limit | Be patient. Consistently spend your daily limit, pay your bills on time, and avoid ad policy violations. The limit will increase automatically over time. | There's no shortcut here. Trying to game the system will only hurt your account. Good behaviour is the only path to getting the limit lifted. |
Navigating all of this, especially when you're just starting out, can be a proper challenge. It's not just about pushing buttons in Ads Manager; it's about understanding the underlying strategy, the numbers, and the psychology of the platform. A lot of businesses waste thousands on learning these lessons the hard way.
This is where getting some expert help can make a huge difference. An experienced eye can spot opportunities you might miss, avoid costly mistakes, and help you build that scalable advertising system much faster. We spend all day, every day inside ad accounts, scaling them past these exact problems.
If you'd like to have a chat and get a second opinion on your specific situation, we offer a completely free, no-obligation initial consultation where we can look at your account together and map out a clear path forward. It might be helpful just to get some clarity on the next steps.
Regards,
Team @ Lukas Holschuh
