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GlossaryJune 28, 20252 min read

Cost Cap

Cost cap = flexible target, not hard limit. Algorithm averages toward target. Better for scaling than bid cap.

By The Ad Spend
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A target average cost per result with flexibility to occasionally exceed for better results. Less strict than bid cap.

Formula

Target average cost (flexible)

Benchmark range

Set at your target CPA. Algorithm averages toward this while allowing some higher-cost conversions for volume.

Why it matters

Cost cap tells algorithm your target, not your limit. It can exceed on individual conversions while keeping average near target. More flexible than bid cap, better for scaling while maintaining efficiency. Meta-specific feature.

Where it applies

  • Meta Ads

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