Facebook advertising

Facebook advertising is a popular choice for e-commerce merchants to market their business due to its easy-to-use self-service media buy.

As an advertiser, have you ever wondered what is the average CPC or CPM you should bid/pay for? What is the industry average based on the industry and country?

Thanks to The Facebook Ads Benchmark Report published by Salesforce.com, you can now benchmark your Facebook advertising cost against the industry average.

Do bear in mind that the data for this report was collected from January 1,2013 to March 31, 2013. It could be outdated now but this is still a good reference for benchmark purpose.

Understanding the Facebook ad performance metrics
Before we drill down the data, let’s understand and recap the definition of key Facebook advertising metrics as shown in the table below:

  Click-Through Rate (CTR)     Number of clicks divided by number of impressions per ad
  Cost per Click (CPC)     Total cost divided by number of clicks per ad
  Cost per Impression (CPM)     Total cost divided by number of impressions per ad, multiplied by 1000  
  Cost per App Install     Total cost divided by number of App Installs per ad
  Cost per Page Like     Total cost divided by number of Page Likes per ad
  App Install Rate     Number of App Installs divided by number of impressions per ad
  Page Like Rate     Number of Page Likes divided by number of impressions per ad

For e-commerce merchants who are running Website Conversion campaign, it is important to add Cost per Website Clicks, Website Conversion, Cost per Website Conversion, Website Conversion Value to the list above.

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However, the Salesforce.com report doesn’t not include these e-commerce metrics benchmark so we are focussing on CTR, CPC and CPM here.

Some advertisers might have overlooked this but Click-Through Rate (CTR) is an equally important metric with CPC and CPM. Most media owners are serving their ads based on CPM model so it is critical to optimise the CTR to get the best CPC and CPM as an advertiser.

Therefore, your target audience and creative are both crucial for higher Click-Through Rate on Facebook.

Average Facebook ads CTR, CPC, CPM by industry
Sometimes you might wonder why the Cost-per-Click (CPC) you are paying is different when comparing with your peers especially those from different vertical.

Yes, the average CTR, CPC and CPM varies across the industry, which you can see for yourself in the following chart:

Facebook ad performance and costs by industry

The top five average CTR by industry are telecommunications (0.919 per cent), publishing (0.790 per cent), general retail (0.502 per cent), entertainment (0.439 per cent), health & beauty (0.433 per cent).

The top five average CPC by industry are clothing & fashion (US$0.08), non-profit (US$0.19), technology (US$0.20), finance (US$0.21), and food & beverage (US$0.21).

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The top five average CPM by industry are dating (US$0.10), advertising & consulting (US$0.16), deals (US$0.23), clothing & fashion (US$0.36), and gaming/technology (both at US$0.38).

Specifically for e-commerce, it is definitely clear that Facebook ads is ideal for fashion merchants in terms of cost and ROI.

Average Facebook ads CTR, CPC, CPM by country
Besides industry, your target country is also an important factor of the average Facebook ads CTR, CPC, CPM.

This Salesforce.com report analysed the top 25 countries globally and top five countries per region (Americas, EMEA and APAC) based on impressions.

Facebook ad performance for top 25 countries

The top five average CTR by country are Taiwan (2.126 per cent), Bulgaria (1.018 per cent), Malaysia (0.788 per cent), Sweden (0.739 per cent), Denmark (0.706 per cent).

The top five average CPC by country are Bulgaria (US$0.03), Romania (US$0.04), Greece (US$0.06), Argentina/Turkey (both at US$0.07), Brazil/Mexico (both at US$0.08)

The top five average CPM by country are Romania (US$0.15), Argentina/Turkey (both at US$0.18),

Taiwan has amazing average CTR at 2.126 per cent, marginally higher than the rest of the countries. We summarise the top five APAC countries in the comparison table below:

Metrics 
  Malaysia  
  Singapore  
  Vietnam  
  Taiwan  
  Australia  
  Cost per App Install  
$0.89
$0.94
$0.90
$0.26
$1.46
  App Install Rate  
0.016%
0.037%
0.008%
0.013%
0.023%
  Cost per Page Like  
$0.48
$1.08
$0.24
$0.26
$0.85
  Page Like Rate  
0.071%
0.031%
0.013%
0.073%
0.075%
  CTR  
0.79%
0.70%
1.55%
2.13%
0.31%
  CPC  
$0.10
$0.32
$0.06
$0.11
$0.38
  CPM  
$0.50
$1.37
$0.96
$1.50
$1.11

Especially for those running e-commerce business, Cost per Website Clicks should be the more important metric (and higher cost) compared to CPC.

Of course as an advertiser, you might want to aim for achieving better performance and ROI than the industry average shown in this report.

The post What is the average CTR, CPC, CPM of Facebook ads? appeared first on e-commerce.milo.

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