The Power of Facebook Advertising
Facebook was launched by Mark Zuckerberg, along with some of his college friends on February 4, 2004. The platform was created with the original purpose of building a connection among the college students of Harvard University.
Fast forward 13 years later, Facebook now boasts the largest membership size among all websites. With an estimated 2.01 billion active users, the social media giant has become the favorite go-to of most companies when it comes to advertising. (1)
What Advertising Plans Does Facebook Offer?
There are two primary ways Facebook allows businesses to advertise on their platform.
The first one is by “Boosting Posts.” By boosting their posts on Facebook, companies can customize the demographic that Facebook would show their post to, and the number of people that Facebook would demonstrate the ad to.
Using boost is the simplest way to advertise on Facebook. A business only needs to click the “Boost” button on the post they made, choose the specification they want, and they’re ready to go. Business can also boost their page to increase its likes, or increase customer awareness.
The second offer Facebook has is “Post Promotion.” The main difference between boosting and promoting is that, unlike boosting where you only need to click a button to do it, promoting requires you to use Facebook’ Ads Manager.
Promoting requires more work; however, using it gives you more flexibility and payment options. By using the Ads Manager, you can choose what type of payment method Facebook would charge you with. You have the choice to choose between Cost Per Impressions (CPM) or Costs Per Link Click (CPC).
What is The Difference Between CPM and CPL?
Cost Per Impressions (CPM)
CPM is a common metric used by the online advertising industry to gauge the cost-effectiveness of an ad campaign. It’s often used to compare performance among different ad publishers and campaigns.
By selecting CPM, Facebook will charge you $1 for every 1000 impressions or views you Facebook ad gets. It is the favorite choice of small and medium business because it is way cheaper than advertising in other impression platforms like television and radio ads.
When using Cost Per Impressions, you will set a budget for every day your ad is up on Facebook. Facebook would then base on this budget when they would spot featuring your advertisement. According to Facebook, they measure impressions based on viewed impressions instead of served impressions.
Facebook measures viewed impressions by using an algorithm that detects when an ad is actually displayed on the viewer’s monitor. While served impressions are merely the loading of an ad on a web page whether it has been seen or not by the viewer.
On the other hand, with CPL Facebook determines the amount you’ll pay with the number of clicks you post gets. The amount depends on the price you bid in the Ads Manager. (2)
Cost Per Link Click (CPC)
Facebook offers another way for businesses to measure their Facebook ad costs. The Cost per Link Click system originally based how much you pay on how many responsive clicks your ad post gets. This includes likes, comments, external links, share, and more.
However, in 2015, Facebook decided to change this metric to make it a better experience for businesses. CPC now consider only those clicks that help accomplish an ad’s objectives. It now counts clicks that take the reader outside Facebook (external links), external call to actions, install apps buttons and more.
That’s why starting today, as part of our latest API release, we’re updating the definition of cost per click (CPC) on Facebook to only include clicks to websites and apps, and not likes, shares and comments.
Cost Per Impressions Vs Cost Per Link Clicks
If you are a beginner in Facebook advertising, it is often a stressful decision choosing between CPI and CPC. Choosing how Facebook will bill you can determine how effective and successful your ad posts will be. (3)
Why Choose Cost per Link Clicks (CPL)?
Using Cost Per Link Clicks can be cheaper because it only charges you for every link click you get. Hence, if your post doesn’t get any link clicks, you can get thousands of free impressions. CPC can be the better choice if you have a minimal budget for advertising.
CPL should also be your choice if your objective is to bring customers to your website, buy your products, install your app, or anything that requires a call to action.
Why Choose Cost per Impressions (CPM)?
Cost per impression is way cheaper per unit than CPL. However, this is only limited up to a certain point your ad is performing. If the ad you posted is getting a very high click-through rate, Facebook may start increasing your cost per impression.
The CPM, on the other hand, is the best choice if you intend to build brand awareness for your company or product. If your business is just starting and you have enough budget to do so, cost per impressions can help your business get off the ground.
Facebook is a powerful advertising tool. It can help your business flourish but making the wrong choice can ruin your bank account. If you have minimal to no experience when it comes to online advertising, asking for help from a professional and expert can help you save hundreds if not thousands of dollars.