Cost. It’s the single, most asked-about topic from first-time Facebook advertisers – and rightfully so. After all, it’s your hard-earned money on the line, and you want to know 1) how much of it it’s going to require and 2) that you’re going to get it back, and then some.
How Much Do Facebook Ads Cost?
Unfortunately, as much as I wish there were, there’s just no hard-and-fast answer on this one. It’s an ever-fluctuating, always-changing number, and it’s completely dependent on what you’re advertising, who you’re targeting, and what your advertising goals are.
The Basics: How the Facebook Auction Works
Before we can dive into the pricing of Facebook advertising, it’s important to understand the basic premise of the platform. Unlike more traditional advertising methods, Facebook ads don’t cost XX amount of dollars per placement.
Instead, the platform functions more as an auction, with advertisers bidding to get their content in front of their targeted audience.
Why does Facebook advertising platform function this way?
Well, it boils down to one important point: users can only see a limited number of ads. Ultimately, this means only ads of the highest quality and relevance will make the cut.
Factors that Impact Facebook Ad Cost
So how does Facebook determine exactly which ads fit the bill? And how can you maximize your chances of getting seen by the right users?
There are a whole bunch of factors that figure into what ads will show and to whom, as well as how much you’ll get charged for it.
These factors include:
Who you’re targeting
Facebook ads can be targeted down to the nth degree. You can choose age, gender, geographic location, job, marital status, interest, and thousands of other detailed data points until you define your ideal target demographic.
Once you decide on your targeting, that’s where the auction begins. Though it might seem surprising, there are other advertisers out there gunning for that same audience – and you’re up against them in terms of real estate and ad views.
Your relevance, engagement and click through rate
Facebook gives each ad a relevance score between 1 and 10 based on much it resonated with the audience you’ve targeted. The more users who interact with and click on your ad, the higher your relevance score will be and the more you’ll be shown to people in your target audience.
Higher relevance also means lower ad costs overall. Always try to create ads that directly speak to the users you’re trying to target; if they click on the “I don’t want to see this” button, it can send your relevance score plummeting, and your ad dollars will essentially go to waste.
As with any advertising method, the more competitive the landscape, the higher the cost is. On Facebook, advertising gets most competitive around the holidays, as well as around Black Friday, Cyber Monday and the Super Bowl.
Your ads will almost always be more expensive these times of year.
Budgeting & Bidding
Because Facebook is an auction and there are no set per-ad prices to go by, your bidding strategy plays a crucial role in your ad’s results. You have a number of options you can choose from, but the best one for your ad depends on the overall goals of your campaign.
We sat down with Sarah Rogers, Manager, Performance Social at CPC Strategy to discuss the bid options available to advertisers:
You can opt to bid:
1) Per impression: You pay for each view your ad gets.
When to bid this way: This option will show your ad to as many people as possible and is good for businesses trying to build brand awareness.
2) Per click: Only paying your bid amount if someone actually clicks on your ad.
When to bid this way: This option encourages users to click on your ad to follow a link to a landing page or to view your Facebook page. We typically see that Dynamic Product Ads charge for link clicks, but you can choose to optimize for impression or conversion events (although it is recommended for link clicks).
3) Per action: Paying up each time a user takes a defined action, like filling out a form, buying a product or visiting a certain page
When to bid this way: By using this bidding objective, Facebook will show your ads only to people who are most likely to buy a product (or take some form of action).
4) Per like: Meaning a payment every time someone likes your Facebook page
When to bid this way: When you know what a like is worth to your brand or goal. You have to determine if this is something your brand thinks is important.
Regardless of which method you choose, you can always do four things to any of your ads: Raise or lower your bid and raise or lower your budget. The bigger your budget, the higher number of impressions your ad will likely see.
For more information on Facebook Ad Costs, email [email protected]