Facebook Advertisement Trends
Anyone scrolling through their news feed on Facebook will see a consistent column of ads on the right of their screen as well as ads spread out in amongst the feed. They will also notice that the advertisements are selected very carefully based on items they’ve recently looked at but from the same set of websites. However, I doubt they really know the process behind the advertisement selection and bidding process of Facebook ads. First, from an advertiser’s point of view, when they are selling one product, they are not only competing with the sellers of same product but with anyone else who is also targeting the individual. For example, say someone is the market for both water bottles as well as suitcases. The water bottle company does not only have to fight with other sellers of water bottles but also with suitcase producers because there is only one advertisement slot on the page. The advertisements are not product based but slot based. For Facebook, there are also different methods of bidding. There are cost-per-click advertisement slots but there are also cost-per-impression, cost-per-action, and cost-per-like. Cost-per-action is probably the most expensive type of advertisement which makes sense because action on an advertisement would generate the most influence on the customer. Cost-per-click is the second most costly because clicks link to a separate page where customers would find out more information about a product. Cost-per-like is the next cheaper option because liking a page still keeps the customer on Facebook and not other websites. Lastly, cost-per-impression is the cheapest because it is paying for views and not any action. Facebook generally does very specific calculations where it would deliver ads based on previous trends. If a user generally clicked ads, then advertisers that pay for CPC will have their advertisements delivered to these people. Advertisers that pay for CPM(cost-per-impression) will get their ads delivered to people to people who use Facebook daily to maximize exposure. Because of this added work that Facebook does for its advertisers, it increases the demand for Facebook adds which increases the bid prices. Lastly, this article mentions some interesting trends. Female CPCs are generally higher than male CPCs probably because girls are more prone to shopping. Apple user CPCs are also more expensive than Android users CPCs because Apple products are generally more expensive than Android products which means their users are more likely and willing to spend money. Cost per anything for anything targeting young users is lower because they generally do not have as much money to spend.
https://adespresso.com/academy/blog/facebook-ads-cost/