There’s a question we hear all the time, and see plastered everywhere: How much do Facebook Ads cost?
We see the question a lot, and one of the only consistent answers we see is “it depends on a lot of factors.” This is absolutely true.
There’s a lot that goes into understanding Facebook Ads cost; everything from your audience to your bidding plan to ranking Facebook gives you directly affects and influences how much you’re going to pay.
We’ve just analyzed well almost 300 million dollars of ad spend (285M by the time we are writing this) during this past year!
This provides us with Facebook Ad cost averages for the entire 2017 year to compare across the quarters.
It might not be able to tell you exactly how much your specific campaign is going to cost, but it’s going to give you a good reference point of the current costs of Facebook Advertising today.
Keep in mind that what you spend on Facebook Ads is up to you and how you set your budget; this post is all about how to affect the cost of Facebook Ads and how to lower the individual rates.
We’re going to take a look at the most relevant data of Facebook Ads cost averages from all of 2017 (with an emphasis on Q4).
We also have all of our 2016 data available at the bottom of this post for additional reference benchmarks. If you’d like to skip ahead to the 2016 data, click here.
In this 2018 edition of our Facebook ads cost, we’ll cover:
For all of these, we’ll also cover differences based on gender, day of the week, hour of the day, and month-by-month breakdowns.
We’ll explain what affects the cost of advertising with Facebook Ads, and how you can reduce it.
If you want to keep this information on hand for you and your team, you can download our study in Pdf, it contains all the 2017 benchmarks for Facebook Ad costs.
How Does the Bidding Process Work?
It’s important to note that Facebook works like an auction. This is important because it’s part of the reason that there’s no set answer to “how much does Facebook Ads cost?”
What this means is that you, as an advertiser, will say how much you’re willing to pay for specific actions on an ad (like views, clicks, or conversions)—you can actually manually adjust this in the pricing and bidding section. If you don’t, Facebook will automatically calculate a bid for you based on your budget and how long you choose to have your ad run.
Here’s the thing: Facebook Ads is a popular place, and you aren’t handing over a stack of cash and getting an ad. You are entering a bid.
Plenty of other advertisers are trying to get that same ad space in a users’ Newsfeed, too, and Facebook limits the number of ads each user sees.
This is only one reason why knowing how much Facebook Ads cost is so important.
There’s a large number of factors that can affect how much your Facebook Ads cost, and bids are only one of them. These factors can include:
- The time of year, the day of the week, and even the specific hour your campaigns are running. There are peak times, and when competition is highest, costs go up.
- Your bidding strategy. You can set an average bid, or choose to set a bid limit on each individual bid.
- The placement you choose. Different ad placements will have different costs. Instagram, as you’ll see, often costs more than most other placements.
- Relevance. Your relevance score, which is calculated partially by engagement and clicks, can directly affect how much Facebook charges you.
- The audience you’re targeting. If other advertisers are trying to reach the same audience members, costs go up because their newsfeed space is not unlimited
Has Anything Changed Recently?
There’s a lot that’s changed in Facebook recently, and it’s unsurprisingly affected how much Facebook Ads cost. There are frequently small changes made to the platform, like different bidding options or new ad formats or placements that can change how things are running. There are also bigger changes that have gone down, causing bigger trickle-down effects.
The algorithm update that de-prioritized Page content was a big one. With organic reach sinking to an all-time low, many Pages have been relying more heavily on the ad system just to get their regular posts seen. There’s a problem though; users’ newsfeeds are limited, and ad space even more so, and the surge of submitted ads can (and has) raised prices noticeably.
This trend may continue, though there is hope that the new algorithm could mean more user engagement, which means more room for ads, evening everything out in the long run. I’d be surprised if we actually saw a true return to old ad costs with so many brands struggling so much with their organic reach, but if we stay relatively close, ads will still be affordable for most businesses.
It’s also worth noting that the amount of time users are spending on the site on average will also directly impact ad cost. If users scroll through their feeds for fifteen minutes a day, there’s a lot more ad space than if they only scroll for two minutes twice a day. In Q4 of last year, we saw Facebook site usage decline by about 5%, which was also likely a factor that caused ad costs to spike suddenly. You’ll see this reflected in the data below.
Facebook Ads Cost: AdEspresso 2017 Benchmarks
Now that we’ve got a clear idea of how the bidding system works and what factors currently are most heavily affecting the cost of our Facebook Ads, let’s take a look at the data.
This data was pulled from all AdEspresso users from all quarters of 2017 (note: all currencies have been converted to USD). While all the data and numbers in this post are coming off real campaigns, you should be using these numbers only as a reference or a guideline.
There are so many factors influencing Facebook Ads cost that there’s no way to know exactly what the cost will be for you until you run a few campaigns. Still, this data can provide a powerful point of reference and more concretely give a rough answer to the question “How much do Facebook Ads cost?” that doesn’t involve a shrug of the shoulders.
When breaking down the numbers in our research, we looked at how different factors like the age and country users were from affected how much they were spending and what the results of the campaigns were.
Ok, now it’s time to unveil our findings…
This data reflects the average cost per click, amount spent, and numbers for multiple variables for 2017.
This information is limited to campaigns with website clicks or website conversions as the objectives. The currency is in US dollars.
CPC by country:
The average CPC for all countries came in at $0.97, with Croatia, Cyprus, and Switzerland having the lowest CPC of $0.75.
While there will be a lot of variation in each individual nation based on industry, audience, placements, and a large number of other factors, it’s good to know going in how much your country averages.
If you have the ability to target audiences in lower-cost countries, great. Even if you can’t, however, $2.09 (the highest average CPC on the list) is still a great price to pay for potential leads for a number of different businesses.
CPC by Age Range:
Targeting older users costs more, with increases in age directly correlating with higher costs. Through most of 2017, it was most expensive to target users 65+, with the average CPC costing more than $.70 for users 65+ and only $.11 for users 13-17 in Q1. Towards Q4, though, prices dropped for users 55 and up.
While older users may cost more to target outright, they may also have higher income and less debt, meaning higher disposable income that they can spend with you.
CPC by placement:
Instagram has always been the most expensive placement, and that has consistently held true in 2017. Both Instagram newsfeed ads and Instagram story ads cost more than their Facebook counterparts. In Q4 this trend increased, with Instagram newsfeed ads (around $1.15) skyrocketing to almost double the CPCs of most Facebook placements (averaging around $0.50). Instagram also, however, has high conversion rates and high engagement rates, so it’s still worthwhile.
The audience network was easily the most affordable, as it has been for some time. Enabling this placement in your campaigns can therefore keep your cost average low, giving you more potential placements.
CPC by month:
We already know that there were a number of factors that drove up ad costs in Q4, and that’s exceptionally easy to see here. The Q4 prices were a sharp turn from the cost trends happening through Q2 and Q3, jumping to around $.50 after hovering closer to $.35 for most of the summer months.
CPC by day of the week:
There were big fluctuations in which day of the lowest CPC throughout 2017. In Q1, Tuesdays held the position for most affordable ad cost, costing around $.34 per click. By Q4, Sunday had the lowest CPC with an average of about $.40, and it was most expensive to advertise on Tuesdays and Thursdays with CPCs close to $.50.
CPC by gender:
In every quarter, it cost more to advertise to women than it did to target men. In each quarter except Q3, it cost around $.15 more to target women instead of men. Does this mean that you shouldn’t target women? Of course not! But if you’re running campaigns exclusively targeting women, know that they’ll cost more than ads not targeting women exclusively.
CPC by hour:
If you’re considering using dayparting for ads, this information should be of some help. The average CPC’s trends stayed relatively consistent in terms of the most cost efficient times of day for your ads to go live. Ad costs were consistently lower in the early morning hours. While Q2 and Q3 had bigger jumps in cost based on time of the day, Q4 saw that level out more, staying between $.45 and $.50 from 5AM to 11pm at night.
What does this mean? While each business is different, dayparting may not do much to help you save on ad costs.
CPC by campaign objective:
It’s easy to think that targeting for impressions will have a lower CPC than optimizing for link clicks, but that’s clearly not the case. Optimizing for link clicks actually had the lowest CPC at $.44 by the end of Q4, with conversions ($.66) and lead generation ($1.18) coming in second or third. There is something to keep in mind here; not all link clicks guarantee conversions, and not all lead clicks guarantee an actual submitted lead form with legitimate information. You may be paying for some results here that you aren’t getting, while reach and impressions give you exactly what you’re paying for.
The takeaway here: never try to cheat the system by hoping that choosing an objective or reach impression will be more affordable than optimizing for clicks outright.
Cost Per Like for Page Like Campaigns
Running a campaign for page likes can be valuable; it enables you to get more followers quickly, who will then get plenty of your information in their News Feeds without you having to pay for it.
This data shows the findings of all campaigns created with the objective to gain more page likes in2017. We have limited countries as we set the minimum spend to 50K or more.
Cost per like by country:
You’ll notice that there isn’t a lot of correlation between CPC and cost per like cost amongst countries.
Norway went from the middle of the pack for CPC up to the most expensive country for cost per like at $2.70. Sweden, on the other hand, fell from a high costing CPC to the middle of the pack for cost per like. Kazakhstan had the lowest cost per like at $.69, with Austra and Finland tying for second place at $.77.
Remember that if your audience just happens to be in Norway, there’s not much you can do if you have to target them. Focus on other areas to cut costs if necessary.
Cost per like by age:
Increased cost per like with age is one trend that stays consistent with CPC, with another clear correlation between age and cost. Q4 saw enormous jumps in cost per like for users 55 and up, even though it decreased for users 25-34.
Again, this does not mean that you should count out older users, because that’s just not the case. Many of these users have more income to spend, and you may be facing less competition overall for this audience.
Cost per like by placement:
The difference in trends between CPC and cost per like and placements is a fascinating one. While CPC stays close to the same between right hand columns and the Facebook feed placements, that’s not true for CPL towards the end of Q4 even though it was almost identical in Q1 and Q2. By the end of Q4, right column ads were almost $.10 more than their newsfeed placement. I think this is particularly interesting because there’s so much more flexibility with feed ads, it’s difficult to reason using right column ads heavily.
Cost per like by month:
The average cost per like by month was just over $.12, with the lower costs in Q1 balancing out the increasing prices in Q3 and Q4, rising up to $.16 in Q4. What’s interesting is cost per likes fell again in December back to the average, likely because Pages were optimizing for other actions from users during this time.
Cost per like by day of the week:
If you want to get more likes on your Page, Friday is currently your day for lowest costs at around $.12, with Tuesday and Wednesday having the highest cost per like costs at $.15. You’ll notice, though, that there’s variation in which days are least or most expensive for cost per likes throughout each quarter, so trying to schedule your ads for specific days may not do you much good as this continues to fluctuate over time.
Cost per like by gender:
There isn’t much of a surprise here; it still costs more per like to target women than it does to target men, with a difference of about $.05 between the genders each quarter.
Cost per like by hour:
Unlike CPC, cost per likes have significant variation by hour, and huge jumps from quarters 1-3 to Q4. The early morning hours have the lowest cost per click, hovering between $.13 and $.19. Costs then continually rise from 7AM at $.20 to 4PM at $.33. Then ad costs decrease again continually, sinking back to $.20 at 11 PM.
Cost per App Install
Driving mobile app installs is a great reason to use Facebook Ads. This data is limited to campaigns that used the objectives “mobile app installs” and “canvas app installs” from 2017.
Cost per app install by country:
App install costs have the most significant variation in average cost per country, climbing from a CPA of $3.70 in the United Kingdom to $10.39 in Panama. If you’re targeting users in a high-cost country, try to use a strong combination of placements and device targeting that have lower costs. Creating hyper-targeted campaigns that are relevant to niche audiences can increase your relevance score, decreasing these costs to keep your overall ad cost lower.
Cost per app install by age range:
The highest costing CPA for app installs was around $2.70 for users 65+, increasing in Q4 after costing less than $2.25 for all three other quarters. Ad costs fell, on the other hand, for users in age groups from 13-44 from the previous quarters.
This is one case where following low cost may be a good way to go, as younger users are overall more likely to install more apps on their mobile devices, and to be using their phones more regularly.
Cost per app install by placement:
Instagram placements typically cost more on average for most ads, but mobile apps installs are the exception.
Instagram placements for app installs actually have a lower CPA of under $2 in Q4 than Facebook newsfeeds ($2.60). This makes sense, since Instagram mobile usage is higher than Facebook mobile usage, and users are significantly more likely to download an app if they see it on their mobile device.
Note that audience network CPAs stayed relatively consistently, while they jumped big time in Facebook newsfeeds and Instagram increasing close to a dollar for both.
Cost per app install by month:
Cost per app install by day of the week:
If you’ve been stressed about costs per app installs going up in Q4, you can at least take some comfort in seeing that they consistently decreased significantly when looking at costs based on days of the week.
Again, notice that there are significant changes happening in lowest costing days and high costing days. By the end of Q4, Wednesdays had gone from the most expensive day of the week with a CPA of around $1.26 to the day with the least expensive CPA at around $.60.
Trying to predict these fluctuations over time would likely be impossible, so don’t worry about scheduling mobile app install ads based on cost.
Cost per app install by gender:
While Q4 saw huge jumps in CPA for women in mobile app installs (reaching $2.59), it actually cost more in Q2 and Q3 to target men. The CPA for men in Q4 sank from $1.44 to $.93, which is actually a more significant divide between the genders than we saw in the above sections.
Cost per app install by hour:
This is another example showcasing how much things can change in ways you wouldn’t typically expect, with CPAs for mobile app installs based on hour falling from highs in Q2 to significantly lower CPAs in Q3 and Q4.
The time of day with the lowest CPA is 2AM at around $.75, and the time of day with the highest CPA is 11pm at around $1.35.
Cost per app install by device:
This is a pretty significant one to watch for mobile app installs: CPA by device.
Apple devices (excluding the iPhone) cost more in general throughout the year, but jumped significantly in Q4 above Android devices and others.
As of Q4, it costs an average of at least $.75 more to target Apple users than Android users, with iPads having the highest CPA at almost $6. When compared to Android’s average of around $2.40, that’s a major cost difference.
Again, this doesn’t mean that Apple devices shouldn’t be targeted, but you should be mindful going in that it will cost more to target these users. Make sure these campaigns are on point and sending them right to the Apple store to download.
Summary of 2017 Data (Overall)
For a quick 2017 summary, and to help us all notice a few interesting trends, we found (on average) that:
Instagram Ads are expensive overall, but good choices for mobile app installs. The CPC and CPA on Instagram for most objectives are higher on most campaigns on average. This was consistent through all four quarters. The exception to this was mobile app installs, where Facebook was more expensive. This is likely because Instagram users are predominantly mobile, making it a stronger platform for mobile app ads.
This does not mean that you shouldn’t advertise on Instagram, because it’s an incredibly valuable platform. Instagram gives us the opportunity to extend our reach to a new audience– particularly a younger audience– and to grow your brand awareness.
- Impressions have surpassed reach as the priciest objective. In 2016, reach was the most expensive objective to target when looking at CPC, but in 2017 impressions easily replaced it. Impressions cost more in almost every single quarter, with the exception of Quarter 2.
- It consistently costs more to target women. Towards the end of Q4 in 2014, CPC by gender had evened out and it cost close to the same to target men and women. That’s no longer true, with CPCs lingering around $0.10-0.15 more to target women instead of men.
- It costs more to target Apple products except the iPhone for mobile app installs. Throughout all of 2017, it costs more to target Apple users than Android users for app installs. The iPad CPA is higher than the iPhone. The iPod is the exception here, being lower in CPA than other Android devices.
- CPCs and CPAs increased dramatically in Quarter 4. This isn’t overwhelmingly surprising. We had the holiday season spike hit at the same time as when Facebook started announcing changes in the algorithm and we saw organic reach going down. That being said, this isn’t always a good thing. More costs means more competition, and there have been problems in the past during high competition times where businesses are unable to get proper delivery of their ads due to the competition levels.
- It costs more, on average, to target older users for likes and mobile app installs. This is different than our findings from 2016, and shows a changing trend. It costs more on average to target users over the age of 40 for likes, clicks, and app installs.
- Link clicks was the cheapest objective to choose. The CPC for the link clicks objective clocked in at the lowest CPC for all objectives throughout all of 2017.
Want to take a look at our past findings on Facebook Ads cost? Keep on reading to check out our 2016 study.
But first, download the whole Facebook Ads Cost 2017 Benchmark study. It’s completely free!
There are plenty of factors that can affect how much you’ll be paying for Facebook Ads, including your audience, relevance scores, and bidding strategies.
AdEspresso data (both the 2017 and 2016 benchmarks reports) covers a large span of usage and you can download and use the report as a reference point to get a realistic, number-based viewpoint on how much Facebook Ads actually cost.
Check out our 2016 data, where more than 150 million in ad spend was spent here in Q4 alone.
CPC Costs & Results in 2016
In just the USA, the average cost per click (CPC) of Facebook Ads in Q3 2016 was 27.29 cents (and 27.40 cents for ALL objectives). The cost per 1000 impressions (CPM) based on Q3 was $7.19 (and $7.34 CPM for ALL objectives).
CPC by Age Range:
CPC went up for the 18-34 age but still didn’t surpass Q1’s cost. 65+ showed the most continuous trend of lower CPC costs over time.
CPC by Gender:
CPC by Placement:
The Instagram placement had a nice drop!
CPC Monthly Breakdown:
CPC by month was relatively stable in 2016 with an increase towards the end of the year!
CPC by Day of Week:
As of 2016 Q3, Sunday and Monday has taken the crown as the “cheapest” day based on cost-per-click! This graph also shows that OVERALL, on average, CPC was lower in Q3.
CPC by Hour of Day:
CPC by Campaign Objective:
The reach objective is by far the most expensive.
Cost Per Like (2016 data)
Cost Per Like by Country:
Cost per Like by Age Range:
44 y.o. and younger showed an overall decline in cost per like, while the older ages are costing more to get those “Likes!” On the very upper end, Mom and Dad (or Grandma and Grandpa?) are still cheap.
Cost per Like by Gender:
The cost to get a female to “Like” your page dramatically dropped in Q2, and it continued downward in Q3, but peaked back up in the last quarter of 2016. Males became cheaper as the year progressed.
Cost per Like by Placement:
Cost Per Like Monthly Breakdown:
Q2 had higher average costs, and Q3, on average, was lower cost per likes on average, but notice that the trend seems to be going upward again!
Cost Per Like – Day of the Week:
Cost Per Like – Hourly:
Cost per App Install (in 2016)
This data is limited to campaigns that used the objectives “mobile app installs” and “canvas app installs” from 2016.
Cost per App Install by Country:
Cost per App Install by Age:
Cost per App Install by Gender:
Females and males both had a huge jump in cost – the highest it’s been all year.
Cost per App Install by Placement:
Cost per App Install by Month:
Cost per App Install by Day of Week:
Cost per App Install by Time of Day:
Cost per App Install by Device:
Summary of 2016 Data (Overall)
For a quick 2016 summary, and to help us all notice a few interesting trends, we found (on average) that:
- The “Reach” objective is by far the priciest – Unlike impressions, reach focuses on appearing only once for as much of your audience as possible.
- It consistently cost less per click/like/install to target much OLDER users. However, keep in mind that you also want to track your revenue rate per conversion; younger users may be excited or willing to engage with your ad or product, but how much will/can they buy or spend?
- CPC cost less for “link clicks” than any other objective except page engagement. This makes a great deal of sense; Facebook has been working hard to improve their optimization algorithms, and this is proof that it’s working. If your goal is to generate general traffic, optimizing for clicks is hands down the way to go.
- The amount businesses spend on ads increases at the end of the year, so although the “averages” show lower costs all around, you can see at the end of September that costs in the monthly breakdowns almost uniformly started to spike up. We expect this spike to continue. This not only causes a surge in costs but also creates a problem of deliverability. November and December are/will be showing intense competition. Even the Facebook Ads community was flooded with complaints from small businesses unable to even spend their budget last year.
- The CPC/CPA on Instagram is usually higher than other placements. This does not mean that you shouldn’t advertise on Instagram, because it’s an incredibly valuable platform. Instagram gives us the opportunity to extend our reach to a new audience– particularly a younger audience– and to grow your brand awareness.
- The CPA by device is inconsistent – Outside of the iPod, it is very variable.
- Gender CPC/CPA has evened out – In early 2016, females were much more expensive. Now it’s evened out!
What Factors Influence the Cost of Facebook Ads?
As we mentioned above, a lot of factors directly or indirectly affect the cost of Facebook Ads.
How much your ads will actually cost—and how much you’ll get for what you pay—will depend on a mix of different elements.
Here are some of the biggest factors that directly influence the cost of Facebook Ads.
The Audience You’re Targeting
The audience you choose will directly affect how much you’re paying for Facebook Ads. This, in part, will largely be affected by who else is targeting the audience you’re targeting.
We’ve discussed above that Facebook Ads works on a bidding system. It’s important to note that a common misconception of marketers is that they’ll only be in competition with those in their industry, like they typically are in sales. If, for example, I sold yoga equipment, I might think I’d only have to worry about other brands that sold yoga or fitness products. This isn’t true. You’re in direct competition with every other marketer who wants access to that particular customer.
That particular customer that I, as a yoga mat salesperson, am targeting is not going to have yoga as their only interest. This customer also loves fishing, scuba diving, skiing, fine dining, and has recently opened a small business. They’re also a dog owner, and have a penchant for signing up to subscription boxes. These are each traits that multiple brands will be targeting uniquely, and we’re all pitted against each other to place an ad on this one, very valuable, very diverse customer.
See where the chaos happens?
Fortunately, by increasing other factors and creating a high-quality ad, you’ll be able to stand out amongst your competition when you’re trying to bid for an ad. Audience is an important part of the cost, but it’s not the only factor that matters. Thanks to a high quality ad, for example, you could pay significantly less than your competition is paying to advertise to the same exact user.
To a certain extent, the audience you’re targeting isn’t something you can necessarily control. While yes, you absolutely choose the audience, if your perfect audience is just more expensive, that’s just the way it goes. You don’t want to sacrifice the audience for cost.
The amount you’re paying for your audience (which won’t be obvious or stated anywhere) will vary even amongst your own campaigns, as your exact audience for different types of ads is likely to change. Your custom audience will include different members than an audience who isn’t yet connected to you, and vice versa.
The Quality of Your Ad
The quality of your ad can send the cost of your ad skyrocketing or lower it dramatically. As if there wasn’t enough motivation to create a great ad so that users convert, we now have another incentive: it directly and obviously affects the cost of our ads.
There are two metrics you want to look at when evaluating the quality of your ad, which are the relevance score and the click through rate.
You’ll get a relevance score for each ad you run, which will be a number between 1 and 10, and it’s measuring (you guessed it!) how relevant your ad is to the audience you’re targeting.
Keep in mind that a high relevance score won’t automatically mean high conversions —your copy might still need tweaking—but the ad itself will be considered relevant, and that will mean a lower cost.
Your relevance score will likely continually change as more users interact with your ad. If they react positively (such as interact with it or click it to a landing page), the score goes up; if they react negatively, by telling Facebook they don’t want to see the ad, the score goes down.
The higher your relevance score is, the less you’ll pay on ads; Facebook directly confirmed this. In an experiment we did, we also confirmed this through an experiment.
We ran the same ad twice, once with strong targeting (relevance score of 8) and once with poor targeting (relevance score of 2.9). The ad with the relevance score of 8 got 4 times more clicks on the same budget, where we emphasized cost per click.
Your click-through rate is the number of clicks on your ad divided by the number of impressions. A higher click-through rate will indicate a higher relevance, and thus more value to your audience.
Facebook will see this and lower your overall cost, though if you’re optimizing for CPC, the more clicks you get the more you’ll spend in that sense. Still, aiming for a high CTR can help the cost of your ads and its performance.
The Time of Year
There are peak times in the year when advertisers are flocking to Facebook Ads in droves—even more than normal. During these peak times, there will be more competition for ads, and you’ll pay more as a result.
Think about how much ads are during the super bowl—now imagine every marketer trying to use Facebook Ads for Black Friday and holiday sales, because that’s pretty much what happens. Big brands spend a lot, raising the cost of Facebook Ads for everyone (thanks, Walmart).
Black Friday and winter holiday sales times will be among the busiest times of the year, but there are other busy seasons and holidays to watch out for; Labor day often comes with a lot of sales and marketers wanting to advertise them, for example.
Busy times of the year can still be worthwhile, even with the extra cost—but you should definitely keep in mind that it will almost certainly cost more.
The Importance of CPA & ROI
While looking at ad cost and ad spend is important, what’s even more important is the CPA and the ROI you’re getting. This is how you can determine whether what you’re paying—and what your ad is costing you—is worth it. Does your ROI (return on investment) have a higher value than your CPA?
Let’s look at another example. Let’s say you’re paying $1.00 per mobile app install. The customer will pay $1.99 to actually install the app. You’re also able to determine that one out of three users that came from your Facebook Ad will make an additional in-app purchase of $3.00.
Let’s say you get 100 downloads. You spend $100, but you make $199.00 from those downloads, and an additional $90 from later in-app purchase. You’ve spent $100, but you’ve made $290.
Your landing page and offer play huge factors in actually getting those conversions, and this is how they’ll affect the cost of your Facebook Ads.
The conversion rate, cost per action, and ROI rates are the most important things to keep an eye on. Make sure that your ad cost isn’t outweighing the ROI (which can be social ROI, too). The more you lower the cost of Facebook Ads, the larger your ROI—financial or otherwise—will be.
How do Bidding Options Affect Cost?
Bidding options allow you to choose how you want to pay for Facebook Ads. You can pay depending on how many people click on your ad, or you can pay for the number of people who see your ad, for example.
There are different types of bidding options, or ways you can pay for ads. These include:
- Cost per click (CPC): You are paying only for each user that clicks on your ad. They do not have to complete the conversion and purchase on your site or sign up on your landing page; they just have to click. That being said, you aren’t paying for users who viewed your ad and didn’t convert.
- Impressions (CPM): You’re paying for cost per 1,000 impressions. The cost per impressions is much lower than a cost per click, and when you want to get a lot of eyes on your ad, this can be a good way to go.
- Cost per action/conversion (CPA): You’re optimizing for a specific action to be taken (i.e. a conversion) however you are paying per impression. Each click to the website may cost more than when you are optimizing for link clicks but, on average, each click when optimizing for conversions is more likely to lead to a conversion.
Facebook also offers different optimization options, each of which will optimize the ad delivery to users likely to take the requested action. These include:
- Conversions: Facebook will deliver your ad to people who are most likely to complete the designated action you’ve chosen (such as a purchase from your site). They evaluate this based on past user history, and you’re paying for impressions (CPM).
- Impressions: Facebook will deliver your ad to as many people as possible, getting as many views on your ad that they can. You’re paying for impressions (CPM).
- Clicks on your ad/to your site: Facebook will deliver your ad to the people who are most likely to click to your site. You’re paying for cost per click or CPC.
- Daily Unique Reach: Facebook focuses on delivering your ads to people up to once a day, affecting frequently. You’re paying for impressions (CPM).
Facebook will automatically choose a bidding option based on your objective. If your objective is to send clicks to your website, Facebook will set the bidding strategy to optimize your ad to accomplish that objective. You can manually change it.
Similarly, Facebook will automatically have the bid set to get you the most conversions/clicks/impressions for the best average price; this means they will bid for you based on how much your budget is and how long the ad will run, and if some of the best ad placements cost a little more, they’ll go ahead and “buy them” for you and lower your average later.
If you have a set number that you want to stay at, however, for each individual bid, you can choose “lowest cost” instead of “target cost” and set a bid cap.
Bidding options heavily affect your Facebook ads costs, because you are choosing what you want to pay for. A cost per conversion may be more expensive than the cost per impression, but if you want to send users to your site and only a few of your impressions actually clicked, it makes more sense to choose a CPC style of bidding.
You also have to consider what’s more expensive per click/impression/etc, and what’s more expensive to run as a campaign.
Wanna dig deeper? TThen you have to check The Evergreen Guide To Facebook Ad Optimization, it’s an incredible 8-chapter guide, constantly updated, that will help you become a seasoned expert in Facebook campaign optimization and will boost your business results.
6 Tips to Reduce Facebook Ads Cost
We now know roughly what we can expect our Facebook Advertising to cost, give or take different varying factors. Some users will find these numbers to match their own; others will find that they’re spending more. Either way, wouldn’t it be great to lower your Facebook Ads cost, no matter what you’re spending now?
Believe it or not, it is possible to reduce the amount you’re spending on Facebook Ads. Even better: it’s possible to do so without sacrificing the quality or success of your ads and campaigns.
Here’s 6 tips to reduce Facebook Ads cost and save you money…
1. Split Test Everything
Split testing is so important; it can help you to determine what’s working on your ad and what isn’t; it can increase your ROI and your conversion rates; and, yes, it can help reduce your Facebook Ads cost.
Plenty of advertisers make the mistake of crafting the absolute perfect Facebook Ad and leaving it at that; if they were to split test, they’d be surprised to see that in many cases, the perfect ad (A) is for some reason not performing as well as another similar ad they’re split testing (B).
Sometimes we won’t know exactly what will work best until we test out a few different ideas.
Until relatively recently, when you ran multiple ads under an adset, the budget wasn’t divided evenly among them. Facebook would prioritize one or two ads, and most of the budget would got to them. They changed this halfway through last year; the budget is now divided equally amongst an ad set, so you’re actually getting a true split testing.
When split testing, you want to test everything, but starting with your image and your text is a good way to go. Our ad creation software makes it easier; you can upload two different blocks of text and two different images, making 4 variations to test. You can also split test your offer and your landing page.
As you monitor your campaigns, you’ll quickly see which are performing better than others. By dividing up our ad spend to test out campaigns for effectiveness and not blowing the whole budget on one just-ok ad, we’ll ultimately find what works best, helping us to lower our score and focusing more of the spend towards the successful, lower costing ads.
2. Keep an Eye on Frequency
A high frequency of your Facebook Ads can be silent but deadly.
Frequency is the metric that tells you how often the same user has seen your ad. If the same people keep seeing your ad over and over, it means two things:
- You aren’t reaching a new audience
- The audience you are reaching keeps seeing the ad but might not be converting
While sometimes a user will see an ad once or twice before they click and convert (Plated finally got me with the third campaign), in general, if they’re interested, they’ll click the first time.
The higher your frequency gets, the less interaction, CTRs, and conversions you’ll see on your ads. This will start to increase the cost of your ads, and you won’t be getting any results.
Ideally, keep your frequency under 3. If it starts getting higher, it’s time to stop the campaign and either adjust it, or terminate it.
By making sure users are only seeing the same ad a few times, you’ll keep engagement and interactions with your ads higher in number,
3. Keep Your Ads New and Fresh
Partly in an attempt to combat frequency and definitely just because you should, you always want to make sure that you are constantly updating your ads. If you run even the most successful campaign for six months straight, it’ll run out of steam eventually.
While you can recycle parts of an ad, you want to keep your ads new and fresh; once one campaign ends, create a new one. Add new images to the same offer; switch up the way you phrase the offer but target the same audience.
Sure, it would be nice if we could run the same ad over and over again, but trust me, when it comes to Facebook Ads, you want to be like Geico’s commercials—there seems to be a new one on, with a new character or gimmick or joke, every time you turn on the TV.
Split testing can help with this; by creating different images and text and offers, you can combine them and create a large variety of different ads quickly and efficiently.
4. Choose Your Audience for Each Specific Campaign
You should be choosing an audience specifically for each campaign you run (or create a campaign specifically for that audience). You don’t need to include your entire target audience in every campaign; by doing so, you can drive up your costs a lot. Instead, focusing on sections and subsections within your audience and sending them highly targeted messages will be more effective.
Different audiences will cost less than others; we discussed this above. Sometimes, an audience will cost less not because of who you’re targeting, but what your relationship with them is.
Remarketing to an audience who is familiar with you (whether you’re using a custom audience from your email mailing list or a custom audience from your website) is likely to get you more clicks, especially when combined with highly targeted messaging designed specifically for them. The more clicks, the more conversions, and more interaction you get, the less you’ll pay and the more ROI you’ll be likely to see.
Choosing your audience is so important, and sectioning off different niches within your target audience will ultimately lower your cost and increase your success.
Why, for example, would you want to run a campaign designed to help you connect with new users and want to include the people already following you within that audience? To prevent this, all you’d have to do is exclude users who are already connected to your Facebook page. With one tweak, you’re already in front of a much more relevant audience. You can even use a lookalike audience created off your current high-value customers to increase the likelihood of profitability.
There are a ton of different audience targeting options on Facebook, and you can use them in any combination that you see fit.
By focusing on one particular segment in your audience at a time and hitting them with highly targeted, relevant ads, you’ll see your ad cost and your ad spend go down quickly.
5. Focus on One Precise Objective
Facebook makes advertisers pick an objective as the very first step when creating Facebook Ads.
Still, I see a lot of campaigns run on Facebook Ads that don’t seem to have much of a focus, trying to get users to like their page, leave their lead information, purchase, and also check out their mobile app all at once. Even if this seems like a slight exaggeration, I actually saw this combination on an actual ad once. It felt chaotic, disorganized, and like it was just plain too much work.
Trying to get more bang for your buck by throwing every single objective into one ad just isn’t going to work. Instead, create multiple different campaigns—and ads within those ad sets and campaigns—that each has a specific focus.
By focusing on one specific objective within each individual ad, you’ll be able to make your call to action clear, as well as to get that ad to the right audience who will convert on it.
You would, for example, focus one set of ads on lead generation. You would focus the next set of ads on social engagement. The third set would focus on remarketing products to your custom audience to drive purchases. Another set of ads would focus on connecting with new users, which you would accomplish by targeting users who you aren’t yet connected to.
Each of these has unique focuses and a unique audience. The copy, image, and offers should all be created and targeted for that goal and that audience.
Ultimately, this will drive down your costs, putting your ads in front of the people who are interested, and keeping you from paying for empty clicks that don’t amount to much.
6. Choose the Right Image
The picture you choose for your ad is going to be what jumps out at a user and ultimately will decide whether or not they even bother to read the text, let alone click or convert. The picture is one of the most important parts of your ad, and choosing the right image will help you lower the cost of your ads by increasing click-through rates and your relevance score.
Plenty of businesses are using carousel ads, giving them the chance to feature more images in a stand-out format; as a result of both having more images and standing out in the Facebook Newsfeed, carousel ads are known for having higher conversion rates, which raises your relevance score and lowers the cost per ad.
You’ll want to choose an image specifically for each campaign that relates to the targeted messaging and its related audience. Just like with copy and targeting, images you use for Facebook Ads aren’t one-size-fits-all.
There are some basic starting points you can use to create a stronger image. Ads with pictures (particularly of attractive women) tend to perform better than illustrations, for example. Color contrast– and color choice— can help draw a user’s eye (though you want to be careful it doesn’t come across as spam-like). And you must always, always choose an image that at least makes sense with your text and copy, though this is more for making sure it makes it past the ad approval team.
No matter what, you always want to test multiple designs and images. Split testing can help you find the right image, which can lower the cost of your ads and increase its success. Win-win.
There are plenty of factors that can affect how much you’ll be paying for Facebook Ads, including your audience, relevance scores, and bidding strategies.
The data that we’ve shared here, however, covers a large span of usage and demonstrates a starting point of what you can use as a reference point to get a realistic, number-based view on how much Facebook Ads actually cost.
Your costs will likely be slightly (or, in some cases, very) different, but knowing what affects the cost of Facebook Ads and how to lower them, you can go in knowing what you’ll be paying, and armed with tools to hopefully pay less.
What do you think? How does our data line up with what you’re paying for Facebook Ads? Have you used any of these strategies to lower the cost of Facebook Ads? Leave us a comment and let us know what you think!