Short answer
- For most local businesses: set your location tightly, keep a sensible minimum age, use Advantage+ audience (Meta's AI targeting) and put your effort into the offer and creative.
- Location and minimum age act as hard limits; interests and other suggestions are treated as hints Meta can go beyond.
- Start with the highest volume bid strategy and a budget big enough to get results; add cost controls only once you know your numbers.
- If you advertise housing, jobs, credit or certain financial services, Special Ad Category rules limit targeting.
How Meta targeting works now
Years ago, good Facebook targeting meant choosing interests carefully: "people interested in yoga, aged 25–40, within 5 miles". Today Meta's delivery system uses far more signals than you can choose by hand: what people engage with, who has responded to similar ads, and what your Meta Pixel or Conversions API reports back.
That's why Meta now defaults to Advantage+ audience in most campaigns. You can still give it suggestions, but the system can show your ad beyond them if it expects better results. A few settings remain firm limits, and those are the ones a local business must get right.
Location targeting for local businesses
Location is the setting that matters most for a local business, and it's one Meta treats as a firm limit. You can target by country, region, city, postal code or a pin dropped on an address with a radius around it, and you can exclude areas.
- Pick the area you actually serve. For a cafe, a few miles. For a roofing company, the towns you drive to. Ads to people who will never visit are wasted.
- Mind "people living in or recently in" the location. This is Meta's default for most campaigns. It's right for most local businesses, but a business that depends on tourists may want to include people traveling there.
- Don't go too small. A very tight radius in a quiet area can leave too few people for the ads to learn and deliver well. Ads Manager shows an estimated audience size as you adjust.
- Exclude where needed. A delivery business can exclude areas it doesn't serve.
Advantage+ audience vs manual targeting
| Setting | How Meta treats it | Local business advice |
|---|---|---|
| Location | Firm limit | Set it carefully to your service area |
| Minimum age | Firm limit | Set if your product requires it (e.g. 18+ or 21+) |
| Excluded custom audiences | Firm limit | Exclude existing customers for new-customer offers |
| Interests and detailed targeting | Suggestion with Advantage+ audience | Optional; a light hint is fine |
| Custom and lookalike audiences | Suggestion with Advantage+ audience | Useful hints: past customers, website visitors |
| Gender and maximum age | Suggestion with Advantage+ audience | Usually leave open unless clearly needed |
Meta also offers "original audience" options where your selections are applied more strictly. For most small local campaigns, testing Advantage+ audience first with good creative and a tight location is a sensible start; switch to stricter controls only if you see clearly wrong people responding. Meta's own explanation is in the Meta Business Help Center; settings and names change, so check there for the latest.
Audiences worth building
- Website visitors from the last 30–90 days, through the Meta Pixel, for reminder ads.
- Customer list uploaded with permission, to exclude existing customers or find similar people.
- People who engaged with your Instagram or Facebook page or watched your videos.
Bid strategies explained
Meta runs an auction for each ad slot. Your bid strategy tells it how to compete for you. The main options in Ads Manager:
| Strategy | What it does | When to use it |
|---|---|---|
| Highest volume | Gets as many results as possible for your budget | The default; best for starting and for small budgets |
| Cost per result goal | Tries to keep the average cost per result around your target | When you know what a lead or booking is worth and have steady volume |
| Bid cap | Sets the most you'll bid in any single auction | Advanced; can limit delivery heavily if set too low |
| ROAS goal | Aims for a return on ad spend for purchase campaigns | Online stores with purchase tracking |
For a local business starting out, highest volume is usually right. Cost controls are useful once you've run long enough to know a realistic cost per lead. Set one too low and your ads may barely deliver.
Budget and how much ads cost
There's no fixed price for a Facebook ad. You set a budget, and what each click or result costs depends on your location, audience size, competition, time of year and, most of all, how good your ad is. Ads people respond to tend to cost less per result.
A few practical rules:
- Choose the right objective. If you want calls, bookings or form fills, pick a leads or sales objective, not reach or engagement.
- Give it enough budget to learn. Spreading a tiny budget across many ad sets means none of them gets enough data. For most local businesses I suggest starting around $300 a month or more in ad budget.
- Don't edit every day. Big changes can restart the learning phase. Let ads run for several days between significant changes.
- Measure cost per customer. Clicks and CPM are just inputs; see CPC vs CPM for what they mean.
Special Ad Categories
If your ads are about housing, employment, or credit and some financial products, Meta requires you to declare a Special Ad Category. In those categories, targeting options are restricted to help prevent discrimination: for example, limits on age, gender and very narrow location targeting, and some detailed targeting options are unavailable. This matters for real estate agents, recruiters, lenders and some financial advisors. The rules vary by country, so check Meta's current Special Ad Categories guidance in the Business Help Center before launching.
My recommendation
For a local business, the winning formula is usually simple: a tight, accurate location, Advantage+ audience, a clear offer, real photos or short video, and a page with one obvious button. That's how I set up campaigns in my Facebook & Instagram ads service ($250 a month plus your ad budget, with the ad account in your name). If you want to run them yourself, start with the settings above and judge results over a few weeks, not days.