Facebook ads' cost-per-clicks up in second quarter

Share this article:

The median cost-per-click (CPC) for Facebook ads rose 22% in the second quarter, compared with Q1, according to a study released July 12 by digital marketing firm Efficient Frontier. The company expects Facebook CPCs to continue to see double-digit growth through the rest of this year.

Siddharth Shah, director of business analytics at Efficient Frontier, said the findings indicate that more marketers are using Facebook ads to acquire fans on the social network as a result of better ROI.

“When we looked at about 20 million fans across various brands that we have, we found that on average, one brand post leads to 100 comments in response,” said Shah. However, he added that interaction rates on Facebook will likely decrease as the social networking site “matures” because consumers will become desensitized to marketers' efforts in conjunction with their increased presence.

The Facebook-related findings in the “Global Digital Marketing Performance Report: Q2 2011” report are the result of data from social marketing company Context Optional, which Efficient Frontier acquired in May. The findings are based on the ad spend data of more than 60 Efficient Frontier clients.

Conversely to the growth in ad spending on Facebook, the quarter-over-quarter increase in search ad spending fell from 17% in the first quarter to 8% in Q2. However, Shah said the data does not suggest ad spending on the social network is subtracting from search spending.

“A question a lot of marketers and analysts have is whether Facebook's spend is incremental or whether there's some cannibalization of search,” he said. “We're not seeing any cannibalization yet. It's mostly incremental.”

To illustrate the point, Shah said spending on Facebook is only 5% of advertisers' overall spending on search. The slowdown in search spending is the result of “global macroeconomic conditions,” as well as the real-time nature of search.

“It's not like traditional media where you have a spending allocation [for the year],” said Shah. “The spend and the ROI are so dynamic that you can adjust them on a daily basis.”

Share this article:
You must be a registered member of Direct Marketing News to post a comment.

Follow us on Twitter @dmnews

Latest Jobs:

Featured Listings

More in Digital Marketing

IAB Tech Lab to Set Global Digital Marketing Standards

IAB Tech Lab to Set Global Digital Marketing ...

In looking to solve complex tech issues, the association opens up full membership to agencies and solutions providers.

Integration Meets Innovation in Planters' Digital Campaign

Integration Meets Innovation in Planters' Digital Campaign

The snacks brand found a healthy way to navigate today's world of digital marketing saturation.

USA Today Decides to Play Games for Real

USA Today Decides to Play Games for Real

It partners with game-maker Arkadium to add 60 new digital games to its site, offering advertisers more segmented breakdowns of players.