Wednesday, July 13, 2011

Facebook PPC Ad Rates Are on the Rise, Says Report

The price of advertising on the world's biggest social network appears to be on the rise.

The average cost of purchasing pay-per-click ads on Facebook rose by 22% in a single quarter, according to a new report by digital marketing platform provider Efficient Frontier.


The company's Global Digital Marketing Performance Report for Q2 of 2011 outlines a number of takeaways gleaned from its own data, which includes ads targeted at about 20 million people on Facebook.

The rise in PPC Facebook ad costs "means that the longer brands wait to engage with consumers on Facebook, the more expensive it will become to acquire fans," the report said, adding that "the immaturity of the medium results in high volatility in the data."

Facebook advertising may be growing, but it's still far from comprising a huge component of most marketing budgets. Generally, Facebook ad spending makes up about 5% of search advertising budgets, although, as the report notes, that can rise to as high as 25% at certain peak times, such as when a company is running a time-sensitive promotion.

Some other notable takeaways from the report:

  • For every additional 17,000 new fans, brands saw an average of one extra comment on Facebook posts.
  • Ad impressions on Google rose 7%, while Yahoo/Bing decreased by 3%.
  • Growth of click-through rate on Google ads outpaced that of impressions, suggesting that the CTR on Google ads have improved.
  • Revenue per click on Yahoo/Bing increased more than it did on Google in Q2.

You can read a PDF of the full report here.

Have you noticed an increase in Facebook ad costs in the last quarter? If so, how will this affect your company's social marketing budget?


Victoria Pratt Shakara Ledard Vanessa Marcil Rachel McAdams Kristin Cavallari

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