Facebook CPC vs CPM

12 years ago

Basically, if you are new to Facebook advertising i would recommend that you start out with a CPC model.

Why?
Look at it this way. When you bid a CPC, Facebook will get paid only if people click on your ads. So, for facebook to make money from your campaigns, it is forced to display your ads in prime locations (Probably positions 1 and 2) where people are more likely to click on them. This occurs the first few hours when your campaign goes live. Facebook will send lots of impressions on your ads to determine whether they should continue displaying them or not. This is determined by the CTR your ad generates within those few test hours. If the CTR is high, then they are sure your ads are interesting and so they can make money from them. When that is the case, they will reward you with a reduced CPC based on your CTR.

However, when you chose a CPM model, facebook knows that it will make money whether people click on your ads or not. So they have no incentive to display the ads in prime locations. Your CPM ads will usually be at the bottom of other CPC ads and your CTR will be less.
However, with an impression of 600, it is still normal to have a 0 CTR though you should start getting worried.

One question though?
What was your destination URL? was it a Facebook page or an external link (i.e your website?). I just want to know why visitors were divided between a facebook page and an external URL.

Thanks
3 replies

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banwork

12 years ago

Question 6 answers your question:
6) If I bid CPC or CPM (not optimized), can’t I still just have a high CTR and get good results? With Facebook knowing the user value, Facebook also now can choose which people to show CPC and unoptimized CPM ads to with a high level of precision. Facebook is so good at this now that generally the optimized CPM price will be the same or lower for a click than the CPC pricing. Thinking of trying to get a great deal with CPM? In rare cases this may work but most of the time, just bidding on CPM will get you zero results. If the audience is large enough, Facebook will intentionally show your ads to people Facebook knows are unlikely to click your ad. If you don’t bid high enough to show your ad to these users Facebook knows don’t engage, you won’t even get any impressions for your campaign. The days of throwing a great ad out with a low CPM bid are mostly over. In any established niche such as MLM, weight loss, money making, or marketing, forget it.

[ 1 ] Thanks
3 replies

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texasnomad

12 years ago

Originally Posted by banwork

This thread may help answer your questions and many more: http://www.warriorforum.com/social-m...-ads-cost.html

Question 6 answers your question:
6) If I bid CPC or CPM (not optimized), can't I still just have a high CTR and get good results? With Facebook knowing the user value, Facebook also now can choose which people to show CPC and unoptimized CPM ads to with a high level of precision. Facebook is so good at this now that generally the optimized CPM price will be the same or lower for a click than the CPC pricing. Thinking of trying to get a great deal with CPM? In rare cases this may work but most of the time, just bidding on CPM will get you zero results. If the audience is large enough, Facebook will intentionally show your ads to people Facebook knows are unlikely to click your ad. If you don't bid high enough to show your ad to these users Facebook knows don't engage, you won't even get any impressions for your campaign. The days of throwing a great ad out with a low CPM bid are mostly over. In any established niche such as MLM, weight loss, money making, or marketing, forget it.

That's fantastic. Thanks for the link; I'll read through it.

Thanks

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texasnomad 12 years ago

I read through your article. Thank you very much for posting that.

My campaign runs in the desktop news feed with the goal of pushing people to my squeeze page; I'm also using Lead pages to test different formats.

I tried optimizedCPM in the past. I had one ad that received 39 clicks. Only 1 click actually went to my web site. The other 38 clicks were thrown away.
- Thanks
- 1 reply
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- lovebeingdaddy 12 years ago
  
  I usually use CPM (cost per millie,which is latin for 1000) for driving likes to my page, cause you get more exposure to page but for other actions, like direct linking to another site, getting opt in etc I tend to use CPC.
  
  Thanks
  
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darbok

12 years ago

Originally Posted by banwork

This thread may help answer your questions and many more: http://www.warriorforum.com/social-m...-ads-cost.html

Question 6 answers your question:
6) If I bid CPC or CPM (not optimized), can't I still just have a high CTR and get good results? With Facebook knowing the user value, Facebook also now can choose which people to show CPC and unoptimized CPM ads to with a high level of precision. Facebook is so good at this now that generally the optimized CPM price will be the same or lower for a click than the CPC pricing. Thinking of trying to get a great deal with CPM? In rare cases this may work but most of the time, just bidding on CPM will get you zero results. If the audience is large enough, Facebook will intentionally show your ads to people Facebook knows are unlikely to click your ad. If you don't bid high enough to show your ad to these users Facebook knows don't engage, you won't even get any impressions for your campaign. The days of throwing a great ad out with a low CPM bid are mostly over. In any established niche such as MLM, weight loss, money making, or marketing, forget it.

Your link is working for me!

Thanks
1 reply

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Magicalidea 12 years ago

Originally Posted by darbok

Your link is working for me!

:confused: So why did you still sad about that ? lol
- Thanks
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texasnomad 12 years ago

I'm sending them to my website instead of a facebook page.
- Thanks
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dereksz

12 years ago

Originally Posted by planetlubs

One question though?
What was your destination URL? was it a Facebook page or an external link (i.e your website?). I just want to know why visitors were divided between a facebook page and an external URL.

It seems like there could be something wrong with the ad setups. As far as I know the ads should only direct you to one page. I'm not sure exactly what you are directing users to but in my case (I use ads to direct them to an in-Facebook app) the reason I used to have many clicks without installs is that my target audience was too broad. Changing ad quality to meet the audience or targeting a more precise audience may help.

Thanks
1 reply

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texasnomad 12 years ago

Are you saying you think the problem is with my ad or with the audience?

The ad started doing better on a tiny budget of $22 per day. I was getting about 18 clicks to my squeeze page and it was converting around 8% (pretty bad, but it's a start).

When I tried upping the budget today to $40, Facebook started sending me junk traffic and I got 0 conversions. Bringing it back down to $20 brought the conversions back to normal. It's bizarre... the less I spend with CPC, the better the traffic that FB sends. It's hard to not feel conspiratorial.
- Thanks
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Brian Arthur

12 years ago

Hi Guys
I must firstly say thanks to everyone in this thread as I've learnt something from it.
I have one question which might just show how new I am to Facebook ads, but if you never ask you never learn. is there any software that you would recommend for tracking the ad campaign info. I had a quick look at facebooks thing and I just feel like they are not offering all the figures and stats I would like so I can better monitor the success of my campaigns and drop the ads that aren't working out. I've heard there are third party programs which can do this but no-one has ever mentioned any names. Could you please help.

Thanking you in advance
Brian

Thanks
1 reply

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lovebeingdaddy 12 years ago

CPV Labs..
- Thanks
- 1 reply
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- Brian Arthur 12 years ago
  
  Originally Posted by lovebeingdaddy
  
  CPV Labs..
  
  Cheers
  
  Appreciate the help : @ lovebeingdaddy
  
  Thanks
  
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Rainmak3r

12 years ago

CPV labs will eat you alive, unless you have the budget to run good numbers you can actually track and make good sense out of.

As a "Noob" that you claim to be, may I advise you play around with Prosper202... very MUCH free and you can track your ads using any number of variables you can setup manually.

Alternatively, Bevo Media has a similar platform that's also free and somewhat easier to use than Prosper202.

Youtube has a ton of videos on how to set these up.

Bear in mind that advertising on facebook is similar to media buys, you're targeting demographics based on interest and other variables, not keyword search...
Facebook's adcampaign results do show you some results you can play with without external tracking, just depends on what you're attempting to unearth using 3rd party tracking.

On a sidenote, regardless of what you're intending to promote, first send that traffic to a fanpage inside facebook.. doesn't matter what the market... you can even redirect that landing page inside facebook to an external page.

Also target broad first to see what demographics and age, are clicking on your ads before you can start narrowing down and hoping for super cheap clicks etc.

Good luck,