What are the prices of Facebook ads? And what factors influence the price of sponsored advertising on Facebook?

 Advertising on Facebook has become a reliable strategy for companies around the world with about 7 million active advertisers on the platform. If you are thinking of promoting your company on Facebook, you probably have two questions: How to calculate the price of sponsored advertising on Facebook

Is advertising on Facebook worth it?

Over the past few years, Facebook has evolved into an effective marketing platform and companies are starting to pay attention.

Since you are reading this article, part of you is probably hoping that Facebook will be a breakthrough opportunity for your business – advertising will be cheaper and the results will be better.

Well, I have good news for you. Facebook ads are a compelling and affordable way to promote your business online.

What are the prices of Facebook ads?

Looking at the data on the cost of funded advertising on Facebook from January 2021 to July 2021, we can see the following :

Cost per interaction: interaction-focused advertising campaigns can expect to pay an average of 0 0.133 per interaction.

Cost per download: advertising campaigns that focus on app downloads can expect to pay an average of USD 5.97 per app download.

CPM: impression-focused advertising campaigns can expect to pay an average of USD 14.12 per impression.

Cost per click:click-focused advertising campaigns can expect to pay an average of USD 1.05 per click.

Cost per conversion:conversion-focused advertising campaigns can expect to pay an average of 9 9.13 per click.

Do not forget that these figures may change depending on the target country and industry

For easy details on the price of sponsored advertising on Facebook, see this table:

Pricing model average price of sponsored advertising on Facebook

CPC cost per click is USD 1.05

Cost per thousand impressions (CPM) USD 14.12

Cost Per Like (CPL): USD 1.07

The download cost (CPA) is: USD 5.97

The cost of each CPE interaction is: USD 0.133

The cost per conversion is: USD 9.13

The price of funded advertising on Facebook

While compiled from an in-depth AdEspresso study that estimated nearly USD 300 million in advertising spending on Facebook, these figures are only averages. Your business may see higher or lower costs on Facebook due to several factors, such as ad placement, target market, industry, and more.

That's why you want to use these amounts as a reference point, and not as a benchmark, for your company's advertising campaigns on Facebook.

If not, you risk setting unrealistic expectations for your campaign, which can lead to poor performance and unhappy decision-makers in the company.

How the Facebook ads auction works?

Before exploring the various factors that affect the prices of Facebook ads, it is useful to review how the Facebook ads auction works.

Once you know how Facebook runs its ad auction, you can start optimizing your Facebook advertising costs.

Here is an overview of the steps leading up to the Facebook ads auction:

• The advertiser logs into Ad Manager to create a campaign and an ad
• The advertiser chooses his daily budget (or the maximum that he will spend every day)
• The advertiser chooses the action for which he will pay, such as views, clicks, or downloads
• The advertiser builds his audience using population, interest, and device targeting
• The advertiser adds his designs, such as ad text, images, videos
• The advertiser agrees and launches his ad

As soon as there is an opportunity to view an ad, a Facebook ad auction takes place:

• Facebook ranks each possible ad bid, estimated action rates, and ad quality
• Facebook uses estimated action rates and ad quality to determine ad relevance
• Facebook generates the total value of the ad, based on the bid, the estimated action rate, and the quality of the ad
• Facebook delivers the winning ad – or the ad with the highest total value

Based on the ad auction, you can find out which metrics are most important for your ads and their costs:

• Display advertising price
• Estimated work rate
• Advertising quality
• Relevance of advertising

If you can improve these metrics, such as improving the quality and relevance of your ad to users, you can reduce the cost of Facebook ads.

Facebook even says that more relevant ads cost less and get more face with users.

Keep reading to learn more about these metrics and how to improve them below.

What factors influence the prices of Facebook ads

Several different factors determine how much your business pays for advertising on Facebook, including:

Audience: the audience determines the costs of advertising on Facebook in several ways. They can increase or decrease your costs, depending on their features. To get the best results from your advertising budget, you should create a specific audience instead of a wide one.

Advertising budget: your monthly advertising budget also affects the price of sponsored advertising on Facebook. While a large advertising budget provides flexibility in your advertising strategy, your business can also achieve its advertising goals by spending less monthly advertising.

Bid advertising: bid advertising can increase advertising costs directly on Facebook. However, you can lower your ad bid costs by choosing an automatic bidding strategy and maintaining high ad quality points.

Advertising goal: the goals of your advertising campaign, which range from awareness to conversion thinking, also affect advertising costs on Facebook. The goal associated with conversion tends to have higher prices than the goal associated with awareness.

Instagram Facebook advertising placement: placement of your ads across Facebook properties, which include Instagram, Facebook, and Audience Network, can affect your advertising costs. Your business can automate the placement of your ads or determine where you want your ads to appear.

Ad quality: the degree of relevance of your ads plays a big role in advertising costs on Facebook. You need to design interactive ads with user expectations and their progress. When you do this, you can significantly reduce your advertising costs.

Season: during popular shopping seasons, such as Christmas, your business can expect higher costs for advertising on Facebook due to increased competition in the ad auction. While unavoidable, your team can combat this feature by adjusting the advertising budget and bid.

Industry: your industry can also determine the costs of advertising on Facebook. The markets with the highest advertising costs include finance, insurance, and consumer services. If you are in a competitive sector, focus on creating top-notch advertising and setting competitive bids.

How to keep the cost of Facebook ads low?

Now that you are familiar with the average CPC and CPM on Facebook, you may think, “but I want my ads to cost less”.

Well, this is quite possible.

But there is no shortcut to reducing advertising costs. You need to put in some extra work and time to achieve better results.

Here's what you need to do.

1. Improve your unique USP selling offer

USP-a unique selling proposition-is what makes your product relevant to its users while also differentiating you from the competition.

Advertising legend Rosser Reeves explained in his book that USP's unique selling offer consists of three parts:

• Each advertisement should explain a clear and relevant benefit to the consumer.
• Try to make the proposal such that the competition cannot or does not offer it. It must be unique.
• The promise must be so convincing that it can move audiences of millions.

Sometimes it's okay to advertise a message that your competitors also use. But try to find a small highlighter that will make your product memorable.

There are thousands of companies selling socks in the world. However, smart branding and great visuals enable you to differentiate your products and brand.

2. Make sure you are targeting the right audience

There was so much talk about buyer personas and knowing your customers that everyone was already tired of it.

Yeah, yeah don't come to me for another customer survey talk.

You probably know what Facebook ad targeting should look like.

But really?)

Have you checked the Facebook Audience Insights tool to find out which demographic groups are most interested in your product?

No?:

You can do it now.

Using Audience Insights, you can get aggregated and anonymized information such as:

• Demographic characteristics-age, gender, lifestyle, education, relationship status, job role, family size
• Page likes – the best pages liked by people in different categories
• Location and language-where people live and what languages they speak
• How and when does the client use Facebook – how often do people in your target audience login to Facebook and what device (s) do they use when logging in
• Purchasing activity – past purchasing behavior (i.e., frequent buyers of women's clothing)and purchase methods (for example, in the store, online)

Later, you can create interest-based Facebook audiences that reach more interested people in your product. Or you will know the best sites to promote your product.

There are some significant data to discover.

3. Advanced Facebook Audience Targeting

When creating new marketing audiences on Facebook, don't let yourself be limited to saved audiences (interest-based audiences that are easy to create).

There are also other types of audiences available on Facebook :

• A dedicated audience
• Similar audience

These two types of audiences go a long way in helping you reduce the price of Facebook ads.

The custom audience is the Facebook audience based on the data available from the Facebook Pixel on your website/landing page.

Facebook audience types: custom audience

You can also create custom audiences based on email lists or in-app actions.

A like audience is a Facebook audience that helps you reach new people who are similar to your existing customers or visitors to your website. As a result, you get access to people who are likely to be interested in your product.

A similar audience on Facebook

In an ideal campaign structure, you should use all three Facebook audience types to reach slightly different audience segments.

4. Exclude previous converts from your audience

A small but very effective hack to keep Facebook CPC and CPC low is to exclude people who have already converted from your target audience.

You can move these people to the next step in the Facebook marketing funnel instead of sending the same ads over and over again.

5. Create highly converting advertising images

Consumer acquisition has discovered that images are arguably the most essential part of your ads. They are responsible for 75% -90% of your ad performance.

It goes without saying that the image of your ad plays a major role in its success or demise.

Some ads immediately catch the attention of all viewers.

6. Add videos to your marketing mix

Videos aren't just a great addition to your ad groups. They can significantly reduce advertising costs.

7. Writing a stronger ad text

Imagine that you have spotted a really cool photo of a Facebook ad in your newsfeed.

Your ad copy is important. A lot.

So how can you write a great copy of a Facebook ad?

Here's what Joanna Webb, the Queen of writing conversion scripts, recommends:

• Write something that motivates clicking: the title of your ad should be its own CTA.
• Associate the "what” with the” why": state what to do – and then state the reason. What is the benefit or result of acting
• Focus on one specific idea: people cannot save time and money. They can save time. Or they can save money. Simplify.
• Use numbers and special characters: we need to draw an eye. So people will not spare a thousand dollars. They can save USD 1000.
• Show empathy: the more you are in their mind, the more you are in their mind.
• Use "new“: nothing itches people like the word” new".
• Keep it short: AdEspresso found that a maximum of 5 words is best for Facebook ad titles.
• Indicate the offer, including any incentives: this can be free shipping or a downloadable e-book.
• Make a promise: but make a backup copy of it.

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