Facebook Advertising Cost Increases Constantly - Blurbpoint

Posted by Sanket Patel

April 18, 2012

Social Media 7 min read

One of the biggest spenders on Facebook Advertising is TBG Digital as currently released its first quarterly Global Facebook Advertising Report of 2012. This report is based on 12 months of data for more than 235 clients in 190 countries and this report also analyzed 372 billion ad impressions to determine how the Facebook advertising landscape is changing. The University of Cambridge Psychometrics Centre has independently verified TBG Digital’s methodology and findings in order to make sure the accuracy.

From past year, the CPM (Cost per Thousand Impressions) has been increased by 41% as per the reports. By viewing this number, that indicate that how much money is Facebook earns each time ad is displayed, has grown by 15% from last quarter alone. Apart from the rapid increase in CPM, the cost per click (CPC) has been increased by 23% since last quarter. You can understand this that Facebook advertising is gaining much popularity in the market as the substantial increase is directly tied to an unbalanced supply and demand.

In Click through rate, the Facebook ads have experienced a substantial decrease and it also indicates Facebook’s users now find the ads less engaging than before. The CTR has been decrease by a 6% across Facebook’s top five markets and by 8% in the US market alone. When it comes to talk about the quality of an ad and other factors frequently impacting CTR and the decrease is mostly the result of Facebook increasing the number of ads displayed on a page.

Simon Mansell, the CEO of TBG Digital said:

“The recent Facebook Advertising Report unearthed some compelling trends as it relates to how brands are using the site to engage customers. One amazing finding is that Facebook has seen an increase in pricing at the same time when it has also grown the number of ads per page, sometimes up to seven, which you would naturally expect to actually deflate prices.”

The social network is attracting new advertisers at a rapid pace which is driving advertising rates higher; Although Facebook’s exponential user growth rate emerges to finally be losing some momentum.


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