Optimisation broadly refers to finding out the best performing ads & weeding out the inferior ones.
A couple of examples:
1. If an ad has spent $0.XX but has not got any clicks, it is paused
2. If an ad has got a CPA of $X.XX which is higher than the desired CPA, it can be paused.
3. If an ad has a bad CTR of 0.XXX%.
4. If we bid X.XX per CPA, but the ads do not run due to low bids. In this case, the bid is increased
5. One ad set is giving a CPA of $0.XX and other is giving a CPA of $X.XX. Then the second ad set is paused.
6. It also includes allocating budgets to different ad sets on the basis of their performance (done on an hourly-daily basis)
This optimisation is carried out as regularly as every 10 minutes and helps you get the most out of your hard earned money.