For Facebook advertisers, everything is going up and to the right: impressions, clicks, costs … and revenue.
“The 2.9X increase in CPMs year-over-year shows the continued demand for valuable inventory as Facebook has continuously ramped up its direct response advertising capabilities,” Nanigans director or marketing Laurie Cutts said in a brief. “Facebook is hitting performance goals for online retailers.”
Nanigans is one of the largest Facebook advertising partners, with $350 million in annualized ad spend. With Facebook earnings being announced today, the company released aggregated data from over 100 retail advertisers and partners over the past year.
And while costs are going up, so is ROI.
“With an increase in upfront costs including both CPM (cost per thousand impressions) and CPC (cost per click), the concern for advertisers becomes price saturation and an inability to hit KPI marketing goals,” Cutts wrote. But the good news is that “revenue per click increased 83 percent year-over-year and 72 percent quarter-over-quarter.”
Facebook costs per thousand impressions jumped 186 percent year-over-year in 2013, Nanigans says, while cost per clicks jumped just 35 percent year-over-year. That divergence undoubtedly contributed to retailers focusing on cost-per-click as a way to keep costs in line and also to ensure campaign and ROI manageability, Nanigans said.
VentureBeat recently released a mobile advertising report based on reader responses: the VB Mobile Ad index.
While ad costs are going up, so too is the share of mobile traffic that Facebook — and therefore advertisers — is getting.
Nearly half of Facebook’s users are now only accessing the site from a mobile device, Nanigans said, contributing to Facebook’s staggering 874 million daily active users. Advertisers are adapting, with three times more companies now tracking and optimizing mobile revenue over the past year.