Digital Marketing

How To Reduce Your Facebook Ad CPM?

Facebook Ads CPM (Cost Per Mille or Cost Per Thousand Views) is the primary metric you can use to inform how much budget you should allocate to your campaigns. We will talk a little about CPM, one of the most important metrics of today’s digital marketing, and we will turn this metric into information that you can use for the benefit of your company.

In short, we will answer the questions you have about the CPM of your Facebook ads, especially the answer to the question of how to lower the Facebook CPM.

If you’re starting to think your campaigns are over budget, you need some guidance on budget planning. It’s worth remembering before you draw the path you need: Just because the competition is big doesn’t mean the Facebook ads cost has to be high. So what to do? Let’s examine the subject in depth…

What is CPM on Facebook?

Facebook CPM; is the metric that represents your advertising campaigns’ cost per 1,000 impressions. Each industry or type of ad will have an average CPM. With this average CPM, you have to make a certain payment for your advertising campaigns. What is this payment for?

Just as you pay for ranking and region for ads on Google, CPM in Facebook ads refers to what you pay for that placement and audience to be shown. Think of it like a digital rental house in the middle of the city for your ads.

The definition of impression will refer to the display of your advertising campaigns to your potential customers in any medium (feed, explore, reels, story, search engine, etc.). Another point to be considered is that; CPM doesn’t tell you how much of your audience you’ve reached in your campaign. Impression qualifies as a different metric here.

You should know that you won’t be able to reach the same percentage of the target audience for each impression. That’s because your ad campaign may have been shown to the same people multiple times. Facebook CPM refers to what you’ll pay per 1000 impressions, depending on certain factors (frequency, position, audience size, etc.).

How to Calculate CPM for Facebook Ads?

Calculate CPM For Facebook Ads

The calculation you’ll make is your CPM. It lets you understand how high or low it is relative to the average cost on CPM Facebook. You may wonder why there are so many calculations over 1000 impressions and think that this is too difficult. In fact, this is only a criterion created to make your job easier. Since the display fees in Facebook ads are quite low, the zeros in this formula will make our job easier.

Facebook CPM is very easy to calculate! First, you should determine the total budget you will spend on the advertising campaign you have published. After this amount is clarified, the order is in the number of impressions. You need to determine how many times this ad campaign should be shown.

If you do not have an opinion on this subject, we recommend that you determine it according to your industry. If you’ve got everything set, you can open your calculator. You’re ready to use the formula by which you can optimize your ad spend.

Facebook CPM Formula

Here’s how to use the Facebook CPM formula, one of the most important criteria for optimizing your campaigns:

Facebook CPM Formula

To give an example according to this formula; Let’s say you have an advertising budget of $3K. The number of impressions you want to get is 200K. Then your calculation by a form will be as follows:

CPM = 3000 / 200,000 x 1000 = 15

This means that the amount you have to pay for every 1000 impressions for your ad campaign will be $15.

Average Facebook CPM

The information we will give under this heading will vary according to the period we are in, but we will give you the averages taken according to the latest data. As a result of the calculations made by including all campaign types, the average Facebook CPM is $ 14.

Breaking it down into types will be more descriptive to you in terms of business Facebook CPM. If your campaign goal is conversions, the average CPM is $15; awareness is $2.45. But if you’re looking to get more traffic, the average CPM here is $6.75. If you created and ran an advertising campaign to bring leads to your company, the average CPM here is $21.85.

Since all these figures show averages, they may not fully reflect the amount you need to spend on your company in the sectoral sense. If you want to reach more specific figures, it will be more useful to do a competitor analysis and look at the average of the market you serve.

What Factors Affect Facebook Ads CPM?

Facebook Ads CPM Factors

Facebook CPM can vary depending on many factors. It is exposed to multiphase influencing factors. Because each advertising campaign requires different investments according to the market and competition it is in. These elements are influenced by variables, from who your target audience is to how big it is. The demographic structure of the target audience, their behaviors, and their interests will affect CPM rates.

The area where your campaigns will be published (such as Facebook, and Instagram), and the publication dates of the campaign are also factors that affect CPM. Bad Facebook CPM for spend on an advertising campaign; it’s an indication that you didn’t plan your advertising budget correctly.

This means that you should constantly test and analyze your campaigns. As a result of analyses of market supply and demand, you should optimize your campaigns and change your budget plan to suit the market.

How to Improve Facebook CPM?

The secret of a good advertising campaign is not always to spend high amounts on advertising. If you apply the right strategy, you can create campaigns that are suitable for your purpose by staying below the industry Facebook CPM average. For this, we will give you some tips and help you optimize your campaigns.

  • Lifetime budget usage can be more beneficial for your company than daily lice planning.
  • Be sure to keep in mind that you can achieve high engagement at a low cost by using A/B testing for Facebook ad campaigns.
  • Observe and limit your ad frequency.
  • Narrow your audience to avoid becoming less relevant for a Facebook ad.
  • Be sure to master the concept of retargeting, because you have a better chance of winning over potential customers who have already been interested in your campaign.
  • Move the time frame from which the ad will run to the hours when your audience’s interest is increasing.
WASK Campaign Optimization Banner

Factors such as the target audience or the campaign’s delivery time can often increase the CPM rate. Because a high level of this criterion can be an indicator of your campaign failure, you may need to prioritize ad optimization.

If you look at the right metrics when analyzing your advertising campaigns and plan for your purpose, it is possible to lower the CPM.

In the top right of your ad manager account, go to “Ads.” Once you’ve selected a date range, click “Performance and Clicks.” You can get to CPM by scrolling through the columns.

Gizem Çelik

Gizem is a Content Writer at WASK; she loves to write and teach with her writings. Since meeting WASK, she has been so excited about writing on digital marketing and technology! Her passions other than writing are: acting, playing sports, singing, dancing and reading/learning new things!

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