Are Facebook Ads Pay Per Click?
If you’re a digital marketer, You’ve probably advertised on Facebook. After all, it’s a trusted site that holds premium customers. With around 7 million active advertisers on their ad platform, you can clearly see the power and confidence many other digital marketers feel when using Facebook.
Facebook’s advertising platform works in a unique way and can operate on either a cost-per-click (CPC) or a cost-per-thousand-impressions (CPM) basis, depending on your preferred method. On average, if you use CPC on Facebook you can expect to see costs around $0.97 per click and for CPM $7.19 per 1000 impressions.
This weird and wonderful way of being able to choose your preferred method of cost really comes down to personal preference and your ads performance. It’s best to try both as you’ll be able to gather data and decide which one gives you the best return on your investment.
Is It Expensive to Run Facebook Ads?
If you consider all of the marketing platforms that are used worldwide, the cost of Facebook ads is kinda somewhere in the middle. You may or may not be aware, but some audiences, placements and locations may cost more to advertise to than others. However, as an average, you can expect to see the prices below.
Cost-Per-Click (CPC) – $0.97
Cost-Per-Thousand-Impressions (CPM) – $7.19
Cost-Per-Like (CPL) – $1.07
Cost-Per-Download (CPA) – $5.47
Remember, these are averages and you’ll probably see numbers much higher or lower than the ones shown above. Although this gives you a rough image, you should consider what may increase your advertising costs.
How Are the Costs of Facebook Ads Calculated?
Just like all marketing networks, you can expect to pay more for premium traffic. On Facebook, there are five main variables when they calculate the true cost behind your chosen advertisement. These are the audience, ad placement, the objective of the ad, month of the year and also your industry.
After reading them variables, you’re probably only seeing dollar signs. But it’s not as bad as you may think, for better understanding, let’s uncover these topics further.
Your target audience can dramatically change your ad expense, depending on who you advertise to. This could be age, interest, gender, location and also language can have a big effect.
This is understandable, due to the value of some audiences. For example, targeting females between the ages of 20-30 and who are into beauty and makeup, is going to cost more than females aged 65+ that are into beauty and makeup. This is because more marketers want to display their ads in front of the younger audience as they’re more likely to have additional interest in the topic.
Facebook can recognize this and therefore bump its prices up to meet the demand in the market. As there are limited users, they force marketers to fight against each other. So in hindsight, the more populated a target audience is by digital marketers, the higher the price will be to advertise to them.
If you’re starting out on Facebook and think your spending too much per CPC or CPM on your advertisements, it might be best to look at another audience that shares similarities. For instance, instead of targeting women aged between 20-30 and who are into beauty and makeup, maybe target females that are partygoers that are aged between 20-30. This audience will be much cheaper as they’re less targeted and partygoers at this age, normally like to wear makeup.
- Ad Placement
When setting up an ad on Facebook, you’ll be able to choose between different placements or alternatively select “auto placements”. Here you’ll be able to pick where you want your ad to appear, this could be an Instagram feed, Instagram stories, Facebook newsfeed, Facebook right-hand column, Facebook messenger and mobile or desktop only. Each has its own pricing point depending on the other variables mentioned in this post, you should try out each placement to discover the costs and go with the one that generates the most profit.
- Ad Objective
There are three main objectives you’re able to select from when creating a campaign, these are awareness, consideration and conversions. Each have their own unique benefits and work in slightly different ways. By selecting one of the categories found in these objectives, you’re telling Facebook what you’re hoping to achieve from this campaign.
Telling them what your goals are towards an advertisement will target customers based on your requirements. If you choose conversion, it’ll automatically search for Facebook users that typically purchase more than others. The same goes for awareness, this will target users based on shareability and how much they engage in content that’s advertised on the platform.
As a standard, the more you advertise for conversions on any ad platform, the higher the CPC and CPM as these are premium customers.
- Time Of Year
Something else that will increase your CPC and CPM is the time of year. Such as Valentines, Christmas, Black Friday, or Cyber Monday, these dates and many more have a massively increased ad placement spent and can cost a substantial amount more.
To spend less around these dates, it’s recommended to create a warm audience and then retarget them with great offers leading up to and during these dates. A warm audience is formed by giving targeted users a feel of what’s to come on these specific dates and to already build interest related to them. When you approach this date, instead of targeting an audience, retarget a lookalike that’s shown interest in your products leading up to the event. Doing this may result in you receiving a lower CPC or CPM than if you would just target the audience as a whole.
Last is the industry you’re targeting and it can affect you as much as your general age, gender and location requirements. For instance, insurance, real estate and forex trading, all have some of the highest CPC and CPM across the board. Not just on Facebook but also on other advertising platforms such as Google, Display Networks, and Bing.
However, never shy away from this. If you’re selling products or services related to these industries, the likelihood is that they’re filled with great profits and can handle the higher costs.
You should now be aware that Facebook gives you the flexibility to either use their ad platform in a CPC or CPM format. Having this flexibility is great as you may be able to manipulate it into something that creates more profit.
I’ve also mentioned the pricing of using Facebook ads, it’s relatively average compared to other platforms and a great place to start at any digital marketing level. If you can manage the pricing variables that are mentioned above, you can certainly get a bang for your buck.
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