The cost of advertising on Facebook varies depending on several factors such as:
- The industry.
- The target audience.
- Your Bidding Strategy
- Ad Placement.
- Ad Relevancy.
- Time of the year.
Several companies such as WordStream, Ad Espresso, and RevealBot conduct annual surveys to find the latest Facebook advertising prices. These surveys can help you get a rough estimation of what you will pay for Facebook advertising.
Four essential Facebook ad costs can be found in their data:
- Cost-per-Click: The average cost per click globally on Facebook was 1.68 USD.
- Cost-per-mile: The average cost per thousand impressions was 12.07 USD.
- Cost per lead: The average cost per lead was 19.68 USD.
- Cost Per Action: The average cost per action across all industries was 7.85 USD.
It is important to remember that these Facebook ad costs are only estimations and are based on the average across all industries globally. To get a more accurate Facebook advertising cost, you will need to consider all of the factors that influence the price of your ads.
The industry that you are advertising in will drastically impact the amount you pay for your Facebook ads.
Your target audience’s location age, gender, and income will also affect the cost of your Facebook advertising cost.
Take a look at the impact location alone has on the cost per click:
Your Bidding Strategy
There are many bidding strategies available when advertising on Facebook. Each of these bidding strategies determines how and what you spend on your advertisements.
- Automated Bidding: Automatic bidding is a popular choice for advertisers who don’t have a clear set of KPIs but want a high volume of results. Automatic bidding is only a good choice when you don’t have a strict CPA, as this bidding strategy tends to be more expensive than the other bidding strategies available.
- Highest Value (Automated Bidding): If you have a Facebook pixel installed on your website, you can opt for the highest value bidding strategy; this bidding strategy is optimised to maximise your conversion value, i.e. get the most return per click. With this strategy, you might find a higher cost per click or acquisition, but you must also consider your ROI.
- Cost Cap: With a cost cap, you can control exactly how much you spend on your Facebook ads. You should remember that because Facebook ads operate on a bidding strategy, if your cost cap is too low, your ads won’t be displayed as often or, possibly, not at all. In addition, the learning phase of the cost cap is a lot slower; during this phase, your cost can exceed your chosen cap. If you typically receive conversions over a longer period of time, for example, after seven days, you will see a higher degree of fluctuation in your CPA when using this strategy.
- Minimum ROAS: This strategy will enable you to break even on your ad spend and see a certain return; giving you more control over the purchase value that your advertisements generate. If Facebook cannot reach your minimum ROAS, the advertisement will stop.
- Bid Cap (Manual): More advanced marketers can opt to set a bid cap manually, taking full control over the amount they spend per bid, but this does not give you control over the CPA. If you choose to set bid caps manually, you will need to calculate the appropriate bids based on your projected conversions and frequently change your bids.
Where you choose to display your Facebook advert will also impact your cost per mile and cost per click. You can choose many places to display your advertisements:
- In Feed: Displaying ads in the newsfeed is one of the most popular choices for Facebook marketers because it is where users first land having logged in. But this popularity has led to a higher cost per impression than alternative placements.
- Stories: Stories are primarily focused on visual elements. This focus on imagery and videos means a lower click-through rate and a higher CPC. Despite this, stories are great at keeping your ad audience engaged and can be incredibly effective in brand awareness campaigns.
- In-Stream Videos: According to Facebook, In-stream videos receive 10% more reach than mobile in-feed ad placements alone. This placement is a great option if your main goal is building brand awareness and has one of the lowest cost per impression.
- Search: Search ad placements enable you to display ads to users searching for something particular, including products in the Facebook marketplace. When done correctly, this type of placement can reduce your CPA because users are already looking for what your business has to offer, making it more likely that they will complete a purchase.
- Messenger: You can use messenger placements to improve the return from your overall marketing spend by sending messages to users who have already expressed interest in your business, i.e. they have already had a conversation with you.
- In Articles: Article ad placements are the optimal choice for those aiming to promote content, i.e. blogs, social media content, videos, or images. These placements have a much lower cost per click than the other options. In addition, these adverts' immersive full-screen mobile experience often results in a much higher number of impressions.
The higher the Facebook Relevancy Score, the less you will pay per impression and click. Facebook has confirmed the importance of their relevance themselves, claiming on their website, “the higher an ad’s relevance score is, the less it will cost to be delivered” because their “delivery system is designed to show the right content to the right people, and a high relevance score is seen by the system as a positive signal.” Though the exact impact the relevancy score has on the cost of advertising on Facebook is unknown, improving your score is definitely worth your time.
To improve your relevancy score, you can:
- Narrow your audience more.
- Show advertisements to people who have already engaged with your brand.
- Exclude users who have already converted.
- Optimise your headlines to encourage engagement.
- Make your Call to action clear and enticing.
- Utilise fear of missing out (FOMO).
Time of the year
The cost of Facebook advertising boils down to supply and demand, i.e. how many advertisers want to place an ad (in your industry) and how many users (in your target demographic) are active and available to view the advert. Because of this, the day of the week, the season, and even the time of day will influence the price you’ll pay to place your Facebook ad.
Here is an example of the monthly difference in cost per click you can expect, according to Ad Espressos data:
According to this average data the cost per click is 0.20 USD more in September than January, but this could be very different for you, depending on the product or service that you are advertising. For example, if you were selling camping equipment, you would be far more likely to pay more for clicks in the summer than in winter.