Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Social Media

Facebook ad pricing up yet spending is down – digital ad trends

Facebook ad prices up

Facebook advertising cost-per-click (CPC) rose 22% in the second quarter of 2011, as more advertisers have come online as was always Facebook’s plan for financial growth. The earliest adopters saw the lowest price when there were the fewest members and as the number of reachable members rises, so will the price.

Efficient Frontier’s 2011 Global Digital Marketing Performance Report says that Facebook CPCs are expected to reach 80% growth by the end of 2011.

Efficient Frontier notes that brands actively seeking fans on Facebook are “on course to double their fan base Year on Year (YOY) by October, demonstrating an increasingly competitive marketplace for consumers’ attention.”

That said, the dollars spent were up 8% in the second quarter but dropped 17% from the first quarter of 2010 with Efficient Frontier suspecting advertisers are focusing on their return on investment (ROI) over volume. We suspect an alternative reason could be that advertisers are diversifying their digital ad spends to include niche target sites rather than the standard Twitter/Facebook duo.

Advertisement. Scroll to continue reading.

Facebook comments are viral

According to Efficient Frontier, comments on Facebook have a viral effect. “An analysis of 10 million fans managed by Context Optional demonstrated that for every brand post, there was an average of 100 comments in response. However, brands with more fans received additional interactions. For every 17,000 additional fans generated, the brand received one more comment per post. This demonstrated that there is a viral effect to having more fans as this creates more direct responses (from existing fans) and also indirect responses (from friends of fans).”

Facebook spends are incremental

The study found that Facebook spends are mostly incremental. “Facebook constitutes approximately 5% of search budgets, though for some advertisers this can peak at 25% during time-sensitive, offer-led promotions.In the entertainment category there are some large advertisers who solely advertise on Facebook. This hints that there are new advertising budgets from the gaming and dating sectors going to Facebook, which would not have gone into Search otherwise.”

Bing/Yahoo! rising in spend share

Lastly, the study revealed that Bing/Yahoo! gained a stunning 3.4% points of spend share from Google since Q4 2010. “Bing’s continued focus on higher quality and higher monetized traffic is paying off. Last quarter it was noted that the ROI on Bing/Yahoo! was better than Google. Bid management technology such as that used by Efficient Frontier has enabled advertisers to take advantage of that by moving budgets as appropriate.”

Advertisement. Scroll to continue reading.

The American Genius is news, insights, tools, and inspiration for business owners and professionals. AG condenses information on technology, business, social media, startups, economics and more, so you don’t have to.


Leave a Reply

Your email address will not be published. Required fields are marked *


American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.




Social Media

The neutral Oversight Board gives Facebook a laundry list of suggested changes to their VIP accounts 'cross check' system.

Tech News

Two powerhouse companies in the social media and delivery space team up to deliver online sold goods right to the buyer's door.

Business Marketing

Facebook announced that they are shutting down their live shopping feature in a move to focus more on Reels on October 1, however, it...

Social Media

New data indicates that influencer marketing is much more lucrative on Instagram and TikTok than Facebook - where will *your* 2023 ad spend go?

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.