Facebook Ad Rates are the Cheapest. Here's Why.


Thanks to one of my favourite e-newsletters. The Silicon Valley Insider Chart O' D' Day -or in less irish terms "of the". Today's chart confirm something I've suspected all along: Facebook might serve up more display ads than anyone else, but they are the cheapest. The next cheapest? Email.

Thanks to a chance phone call from Richard at the Goodline Group I was reminded of the power of permission marketing. Beyond permission marketing is a strong strategy for the customer focused businesses of the future. Today organizations are clamouring just to get people to see them in a world full of marketing and advertising.
photo by: Doug Wheller. Remixed under creative commons licence.
That means getting a chance to have eyeballs see your brand, product or services and hopefully click a few things can be costly. See the chart below to see the most expensive and least expensive types of sites to advertise on. The rates are in CPM or cost per thousand impressions. That means about 2000 eyeballs had the chance to see an ad. It doesn't even mean that they saw the ad. It may cost you significantly less on Facebook than on any other site to get the chance to be seen but low prices reflect users likelihood to ignore your advertisement.

The reasons for the differences in the costs of online display ads are complex and I don't pretend to know all about them, but after using Facebook ads over the last 2+ years I've learned a lot and watched as the average cost of a click has triple and quadrupled. Still it has the lowest cost of online ads because of the users habits and nature of Facebook ads.

Some users ignore them entirely. Some users click them all the time with no intention of taking any further action. Some users are playing games when they click an ad and really just want to back to their game. Some users are doing research on your use of the ads and where you direct them with that ad. Some users genuinely connect with your brand. It's challenging but at this time and when used right represents strong current and better future marketing value.
photo by: Penny Higgins. Remixed under creative commons licence.
On the bright side some users read ads and don't click, raising awareness. Using a strong brand image can help to build familiarity of that brand and cut through the generic ads. You get great metrics, but have to draw some of your own conclusions.

It was announced today during Zuckerberg's Web 2.0 interview that 250 million facebook users are daily users. 50% of users come back everyday. Last I hear the average user spends almost an hour on facebook each day. I like Facebook advertising and I advocate it for many reasons; especially targeting and related brand awareness. For more on this please see Facebook Advertising: Beyond the Click. Below I have embedded Zuckerberg's 60 minute 'interview' at web 2.0 today.

skip to 7 minutes for the 'confrontation'

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