Last year Facebook had over 3 million advertisers racking up $5 billion in ad revenue. Is 2017 the year to get involved with Facebook advertising? How much does it cost? What returns are available? We explain it all below!
How do they work?
Facebook ads work much like Google ads. You set up an advert on one creative template, link this to your website and/or Facebook page, target your audience, set a budget, and let it go. There’s a little more to it than that, but it’s the gist. You can show off your products or services in a carousel, distribute your ads across devices, and use retargeting to help cross/up-sell to users interested in your brand.
How do I find out how much Facebook ads cost?
Hootsuite’s Facebook advertising gurus Adespresso analyse millions of dollars of ad revenue on Facebook every quarter. Their latest stats from Q3 2016 tell a story: Facebook ads are gradually becoming more expensive and businesses are willing to put up bigger spends per year (which kind of suggests they’re working for those businesses).
Much like any other kind of CPC or PPC advertising, the cost is all about budget and strategy.
It’s a bid system: treat it like one
Facebook advertising limits the number of ads each user sees, so you’re bidding for an ad space against a range of competitors. You’re also bidding against your target audience’s interests. For example: if you create an advert showing off an incredible SEO and PPC company, your audience are not just business owners interested in SEO, they also like organic coffee, sailing, films and gardening. The customer is diverse. Facebook ads cost less when you beat off the competition by focusing on creating a high quality advert that will reach the customer and provide value to them.
It’s about quality, relevancy and CTR
Focus on these three points first, you’ll reap the rewards in customer growth and a higher ‘relevancy score’. Facebook scores every ad by its relevancy out of 10, based upon – obviously – how relevant an ad is. They admitted a high relevancy score means a low ad cost, so the more people that interact with your advert, the better the message is, the less you pay. Adespresso’s own experiment showed a Facebook ad they ran with “a relevance score of 8 got 4 times more clicks on the same budget, where we emphasized cost per click.”
Measure your options and returns
True cost will become apparent after you’ve chosen a bidding option, and Facebook will automatically chose a bidding option for you based on your objectives. It’ll be either:
- Cost per Click (CPC)
- Impressions (CPM – cost per thousand impressions)
- Cost per Action (downloads, sales, form submissions)
- Cost per Like
These will determine how much you spend. Cost per Action will be more expensive than Cost per Click, but that action may turn into a conversion or download and net you money. Whereas Cost per Like allows you to get more followers quickly, who will then receive lots of your information in their News Feeds without you paying for any of it. Keep your ear to ground when it comes to your ROI and adjust your future budgets accordingly.
So, you can definitely create a success story with Facebook advertising. It requires focusing on a specific audience, targeting your ads, and will take a little trial and error. The extra reach – be it likes, brand awareness, product exposure or clicks to your website – is worth the time it takes to put a create ad together.
Here’s some other Facebook ad success stories: