We’ll also provide tips and tricks for getting the most out of your Facebook Ads campaigns. Whether you’re a seasoned marketer or just starting out, we will provide you with valuable insight into the world of Facebook Ads in 2023.
The current state of Facebook advertising
Facebook (and Instagram as they're intrinsically linked) is still great platforms to market your business and they work particularly well when used alongside other forms of paid social and pay-per-click (PPC) campaigns. The early part of the calendar year is traditionally a more cost effective time to advertise on Facebook because fewer people advertise at this time. Seasonal fluctuations affect product demand and advertising costs typically rise in the fourth quarter because businesses allocate more of their marketing budget over Black Friday and Christmas.
As a rule of thumb, Facebook is best for targeting older users while Instagram is a more visual platform and better suited to younger audiences.
How much do Facebook Ads cost?
It’s the question we get asked the most and it’s difficult to say. Generally, you can pay as much or as little as you wish.
The cost of Facebook Ads is measured in "cost per thousand impressions", which Facebook abbreviate to CPM (costs per mille). Based on data from 2022, the average CPM across all industries through the year was £11.80. This means that using an example click through rate (CTR) of 1%, each visitor you attract with your Facebook Ads would cost £1.18.
| Cost per thousand impressions | £11.80 | |
| Cost for 100 impressions | £1.18 | |
| Click through rate |
1% |
|
| Therefore, 1 click from a visitor will cost £1.18 | ||
The premise is simple: you tell Facebook how much you want to pay and it will display your Ad until you have spent that amount.
There are controls and caveats to this (beyond the scope of this article) but essentially you pay regardless of whether the customer clicked on your Ad or not.
In this respect, it's significantly different to Google Ads. Facebook finds you customers and charges accordingly; Google pushes you in front of customers when they go looking.
This makes Facebook particularly effective for businesses looking for new leads or selling low ticket, impulse purchase items.
As of today, Facebook sets a minimum Ad spend of £2 per day and we recommend that small businesses set aside at least £10 - £20 per day for their advertising budget. And you will need to run Ads for at least a month to give yourself a good chance to assessing the success of your campaign.
What factors affect the cost of Facebook Ads?
Target audience
Traditionally, it was always best to define your audience, the more targeted your ads were the cheaper the cost. However, in the last few years privacy laws have changed and broader targeting is starting to perform better and more cheaply. However, certain audiences are still more expensive. This is because these people are historically more likely to buy causing increased competition amongst other advertisers.
Advertising objective
Different objectives carry different costs. For example, if you choose "sales” or "leads” as your objective, it will generally cost more than choosing a "reach” or "brand awareness” objective.
Quality score
The higher the score, the cheaper the CPM. This score is based on several factors including: a well suited product or service, good advert creative; quality imagery / video; engaging copy and an optimised, fast-loading website.
Engagement
Any ads that receive frequent positive user engagement will cost less.
How can you reduce the cost of your Facebook Ads?
Facebook wants to build a positive user experience and will increase the CPM for low quality Ads that receive negative user engagement.
Therefore, it's sensible to focus on the customer journey with the end goal being sales, leads and positive engagement.
You might also try to use a more narrowly-defined target audience because the more relevant the advert, the more likely the audience will click or engage.
Facebook wants to build a positive user experience and will increase the CPM for low quality Ads that receive negative user engagement.
The better your offering, the cheaper the cost
Work on improving your website, ad creative and your overall offering and you will find that in the competitive auction, Facebook will favour your Ad over those of your competitors, even if they are spending more.
Optimise the format of your creative for every available placement
For example, create carousels, static image Ads and video Ads that work in both portrait and landscape. This way, you’ll receive additional exposure on the main feed, right side column, Instagram Reels and In-Stream Video too. Drop Ads that are not performing well and raise budgets for those that generate results. And regularly test out new creatives and audiences.
Overall
Facebook and Instagram ads can be a hugely lucrative investment. We have seen over 10x return on ad spend for some clients spending in excess of £1,000 a day. By continually analysing results and optimising your campaigns, you will be able to boost your profitability significantly and scale your marketing from there.
Key takeaways
- The first quarter of the year is the cheapest time to advertise; the fourth quarter the most expensive
- Budget at least £10 - £20 per day on Facebook advertising
- Plan to run a campaign for at least a month
- Accept that a campaign will need time to optimise; focus on long term growth not overnight success
- Good targeting, engaging creative and a quality website will help bring costs down
- Use video wherever possible. Facebook will prioritise video ads for Instagram Reels and reduce your overall costs
- Consider using an agency to run campaigns on your behalf. Facebook advertising is complex and using an agency with a strong understanding of the platform could save you a lot of time and money
