When you create a new Facebook ads campaign, you see a setting called “buying type.” This setting influences how Facebook charges you, who sees your ads, and how your spending competes with other advertisers. Facebook offers two main buying types: auction and reservation. For almost all practical use cases, the auction model works best. The reservation model exists, but it suits very specific needs—usually large-scale, guaranteed reach deals.
This guide explains both buying types deeply. You learn how the auction model works with supply and demand, why it’s usually the better choice, and what reservation means. You see how each approach affects costs and delivery. After reading this, you can confidently pick the best buying type for your campaigns.
The Auction Buying Type
Facebook’s auction system runs on a simple principle: supply and demand. Advertisers compete for attention. More advertisers mean higher competition. Higher competition raises the cost of showing your ads to people. Fewer advertisers mean lower competition and lower costs.
- How the Auction Works:
Each time Facebook shows an ad, it runs a mini-auction among eligible ads. Advertisers who target that user compete. Facebook then weighs factors like bid, ad quality, and relevance. The outcome decides which ad appears. The system tries to maximize value for users (by showing relevant ads) and for advertisers (by delivering results). - Effect on Costs (CPM):
With the auction, your cost per thousand impressions (CPM) fluctuates. When many advertisers want the same audience, CPM rises. When fewer advertisers bid on that audience, CPM drops. This fluctuation is natural. It reflects real-time competition in the marketplace. The advantage: you pay exactly what the market sets at that time. If you target a broad audience, you might see a stable CPM. If you target a niche audience everyone wants, you might pay more. - When to Use Auction:
For 99% of advertisers, auction is the default and preferred choice. Whether you want conversions, leads, or sales, the auction model adapts. It finds people most likely to take your desired action and charges you based on current market conditions. With the auction, you maintain flexibility. You can scale budgets up or down easily. You can test different audiences. The algorithm finds the best opportunities under constantly changing conditions. - Why the Auction Is Ideal:
The auction model suits small, medium, and even large advertisers who value efficiency. It ensures you always compete at current market prices. You pay no fixed, long-term commitments. You get to stop or start campaigns whenever you want. You rely on Facebook’s algorithm to optimize delivery for the best possible results each day.
The Reservation Buying Type
Reservation buying works differently. Instead of competing in daily auctions, you pre-book your reach. You say, “I want to reach X number of people over Y period.” Facebook gives you a price for that guaranteed reach. This means you lock in a certain audience exposure at a certain rate. It’s like reserving ad space in advance rather than bidding for it dynamically.
- How Reservation Works:
With reservation, you pay upfront or commit to a certain deal. Facebook promises to deliver your ads to a fixed volume of impressions over a set time. This might sound appealing if you want a predictable schedule. However, there’s a trade-off. - Limited Objectives:
Under reservation, your choice of campaign objectives shrinks. You cannot run all the objective types as you do with the auction model. Reservation best suits brand awareness campaigns that focus on reach and frequency rather than conversions or leads. - Effect on Costs:
Reservation often offers a fixed or stable price for impressions. You may get a lower price for some impressions, but the quality and relevance might suffer. Why? Because if your requested audience or volume is large, Facebook must deliver ads to users who may not be in high demand among other advertisers. This can mean showing ads to less-engaged or less-ideal users just to meet the guaranteed reach. You might pay for impressions that hold less value. - Why Advertisers Rarely Use Reservation:
For performance-driven advertisers—those who want conversions, leads, or sales—the reservation model lacks flexibility. You cannot easily adapt to changing market conditions. You cannot rely on algorithmic optimization the same way. You sacrifice some quality for guaranteed volume. Most advertisers prefer the control and efficiency of the auction, where Facebook’s algorithm finds the best possible matches moment by moment. - When to Consider Reservation:
Reservation deals might make sense if you are a very large brand with strict branding initiatives, want a guaranteed number of impressions, and have a long-term campaign planned on a fixed schedule. Maybe you are running a big brand awareness push tied to a product launch date and need locked-in reach. Even then, many big advertisers still choose auction for its flexibility and performance-driven approach.
Comparing Auction vs. Reservation
- Flexibility:
Auction: Highly flexible. Start and stop anytime. Adjust bids and budgets as needed.
Reservation: Less flexible. You pre-commit to impressions and schedules. - Pricing Mechanism:
Auction: Price fluctuates with supply and demand. Real-time market price.
Reservation: Fixed price for guaranteed reach over a set time. - Objectives Available:
Auction: Almost all objectives, including sales, leads, and conversions.
Reservation: Limited objectives, mostly focusing on reach and brand awareness. - Audience Quality:
Auction: The algorithm finds the best available placements at each moment. Quality remains high if you target well.
Reservation: Facebook must fulfill your request. If demand is low, it shows ads to less ideal users. Quality can drop. - Who Uses It?:
Auction: Suitable for nearly every advertiser, big or small, focused on performance.
Reservation: Rarely used by small or medium advertisers. Potentially used by large brands for guaranteed branding efforts.
Practical Tips
- Always Start with Auction:
If you are new or focused on conversions, start with auction. It aligns with performance goals and leverages Facebook’s strong optimization algorithms. - Monitor CPM Over Time:
Auction-based campaigns show CPM shifts. Use these shifts as data. If CPM spikes, consider broadening your audience or adjusting your timing. If CPM drops, enjoy cheaper reach. The algorithm responds to conditions. You learn from these changes. - Do Not Fear Competition:
While the auction gets more expensive when competition rises, it also means your audience is valuable. If needed, test different ad creatives or target segments. The auction model’s flexibility allows quick changes to remain competitive. - Reservation Is Not for Most Businesses:
Unless you have a large, fixed branding budget and need absolute predictability, avoid reservation. Auction-based buying is the industry standard for performance.
Key Takeaways
- The Facebook ads system offers two buying types: auction and reservation.
- The auction model uses supply and demand to set prices and optimize delivery, giving flexibility and better performance for most marketers.
- The reservation model allows fixed reach and price but reduces flexibility, objectives, and audience quality.
- Almost all performance-focused advertisers choose auction. Reservation suits only very specific large-scale branding scenarios.
Conclusion
Choosing the right buying type is simple for most advertisers: pick the auction model. Auction ensures you pay market-driven prices and rely on Facebook’s optimization to find the best placements and audiences. You get a wide range of objectives and dynamic flexibility. Reservation, while it exists, offers fewer advantages for typical conversion-driven campaigns. Unless you have a unique branding need for fixed reach, stick with auction. This choice sets a solid foundation for effective, efficient, and results-oriented Facebook advertising.