There are two ways you can bid on traffic in a Facebook campaign. One is CPM (cost per mille—your ad gets shown 1,000 times) where you pay for impressions, and the other is CPC (cost per click) where you pay per click, or each time someone clicks on your ad. You can also let Facebook automatically bid for you, or you can manually bid CPM or CPC. Facebook gives you a suggested range and you just put in an amount that is the maximum you are willing to pay for the click. According to Facebook, the suggested bid range is there to help you pick a maximum bid so your ad will be successful.
It’s based on how many other advertisers are competing to show their ad to the same audience as you are. You don’t have to pick a bid in this range, but you can use it to help you pick a bid that will result in a decent-sized amount of impressions and clicks. According to Facebook, you will never pay more for an impression or click than necessary, so entering your true maximum is the best way to make sure you don’t miss out on impressions and clicks you could have received. That being said, we always bid manually, because that is how we find our ROI in advertising. However, when you’re doing a “LIKE” campaign (a campaign for “Like Us” clicks only), this is automatically set up as optimized CPM by Facebook.