Analyzing Return User Behaviour helps you optimize your site for better engagement and more conversions.
Data Snacks | Jul 23
Jessica Malnik on July 15, 2020 (last modified on July 19, 2020) • 20 minute read
Facebook ads can be one of the most cost-effective advertising channels to get in front of your ideal customers.
You can target people based on interests, demographics, and even milestones, like if someone just had a birthday, got married, or had a kid.
However, if you aren’t careful, it is easy to spend a ton of money on Facebook quickly with nothing to show for it.
One of many metrics you can use to keep your ad campaigns and wallet in check is cost-per-click (CPC).
In this post, we’re going to dive into what CPC is, when you should use it, and how to reduce your CPC on Facebook Ads.
CPC, or cost per click, is simply the cost you’re paying for each click to your ad campaign on Facebook.
Besides the content of your ad itself, there are several components that can affect your Facebook CPC, including:
According to Facebook, they calculate CPC by taking the total amount of spend and dividing it by the total number of link clicks.
If you choose a CPC ad campaign, this means that you pay Facebook ads anytime someone clicks on one of your ads.
A CPM campaign means that you pay for every 1,000 impressions that your ad receives. This means that you are being charged based on the number of times your ad has been viewed regardless of if they clicked, engaged with (i.e. like, share, etc.), or even if they viewed it for only a couple of seconds as they were scrolling through their newsfeed.
Editor’s Note: Want to keep tabs on all of your Facebook ad campaigns? Use this Facebook Ads Campaign Performance Dashboard to track engagement, click-activity, CPC, CPM, money spent, and more.
When we surveyed a bunch of marketers back in 2018, all of them reported a CPC of under $3.
Most impressive, however, was that 63% of respondents who reported a Facebook CPC of less than $1.
However, a lot more people and brands are using Facebook Ads in 2020. We would caution you against trying to use a universal CPC benchmark. That’s because there are so many factors that go into an ad campaign.
Instead, it is best to create your own benchmarks based on your historical data (ideally) or in your industry. This is because ad CPC rates fluctuate based on supply and demand. If you are in an industry where there are a lot of companies all buying ads, this drives up demand, and you’ll end up spending money per click than any industry with less competition.
The answer is it depends.
Gwyn Wood of Kiwi Creative adds, “Choosing CPC or CPM as the primary determiner of a Facebook Ads campaign’s success is entirely dependent on the purpose of the campaign.
For example, if your campaign focuses on brand awareness and top-of-funnel users, opt to monitor CPM. Based on how much you are spending on these thousands of impressions, you can see how relevant & compelling your ad is to your audience.
However, if your campaign focuses on conversion and lower-funnel users, opt to monitor CPC. You want to drive clicks to your site, but you also do not want to pay a hefty sum for each one of those clicks. In this way, there is no clear-cut answer between monitoring CPC or CPM. To choose the best metric for you, think about the purpose of your Facebook Ads campaign, and its relationship with your sales funnel.”
The general consensus among most is to focus on CPM for brand awareness initiatives and CPC for everything else.
“I think this depends on the buyer’s journey,” says Brooks Manley. “CPM is likely a better signal for top of funnel campaigns, while CPC is a better signal for bottom of funnel.”
Rosalina Felipe of Portent says, “It depends on your campaign objective. If your objective focuses on Brand Awareness initiatives, measuring CPM will help determine how effective your campaign is. By optimizing non-brand awareness objectives, CPC will help you determine how successful your campaigns are.”
Djordje Milicevic of StableWP adds, “When running Facebook Ads, the CPC model is superior for measuring campaign success since it’s less risky and it also acts as a micro-conversion. A user clicking through your ad is still some form of action and result. At least the user gets to see your landing page and offer, increasing the chances of a conversion. On the other hand, CPM only indicates that your ad was served on Facebook. However, there’s nothing that shows if an ad was clicked or even noticed, meaning you can spend thousands of dollars on Facebook ads without anything to show for.”
Isaac Lauritsen of Optimistic San Jose Marketing says, “Ultimately, it comes down to the quality of the ad. If it’s not a great ad, but you have a solid sales funnel, CPC is the way to go. You might have fewer people clicking, but the funnel is where the conversion from person to customer occurs. Conversely, if you have a great ad but an okay sales funnel, CPM is the better option. The sales funnel might not work on everyone, but because there are a higher number of people in there, there’s a good chance you’ll be able to turn some of them into customers.”
Monitoring your CPC in Facebook Ads is easy.
Just go to the Ad Manager section of your Facebook Business Manager account, and click on the ad tab.
Then, click on customize columns and make sure CPC is checked.
Now, you will be able to see the CPC for each ad you run.
One of the best ways to boost profitability in your business is to reduce customer acquisition costs, which includes eliminating any wasteful ad spend. Here are 17 tactics you can use to lower your Facebook Ad CPC.
“People don’t use it often, but I have found this tip to be very useful,” says Will Hayes of The Business Marketing School. “Basically, testing the objective for a campaign that wants to just get impressions → traffic vs conversions set up for page views.
Not only have I been able to consistently lower my CPC with the conversion objective, but once I get lower funnel conversions in (leads, purchases, etc.), I can easily change the conversion I’m optimizing for – and still keep all that valuable historical data working for me. Basically this tip lowers my CPCs and sets me up for future tests/success.”
“To optimize the CPC of your campaign, you’ll need to create a highly targeted strategy,” says Chris Gadek of AdQuick. “Rather than just allowing Facebook to select your audience, pick the interests and the geographic locations yourself so that you can target those that best suit your company.”
Blake Taylor of Synergy Business Brokers says, “By segmenting our target audience and creating ads that are focused on these smaller segments of our audience base, we can allocate budget funds to drive Facebook Ads to specific groups that we know perform well and will meet a receptive audience. This is a particularly useful strategy when running multiple ads and don’t want your viewers to overdose on your content.
Bernadett Dioszegi of Bannersnack adds, “The most effective way to optimize the CPC of your Facebook ad campaigns is to target a more specific audience with highly relevant ads. Try to narrow your target audience, so you will only bid on who you really want to reach. Create personalized ads for your audience to make sure you catch their attention. Always emphasize the users’ benefits, what the user can get should be the main focus in your ads.
Use high-quality images with a strong visual focus. Relevant images that support the main point of your ads tend to perform better. Many times it’s better to choose images of people over images of objects/drawings/graphics because people can relate more to people. Use a strong USP (unique selling point). Use direct numbers and discounts in your headline, because humans love numbers. We love to analyze and structure everything in our lives. It’s an interesting fact that humans are more likely to trust odd numbers. In fact, they can increase your CTR on ads by 20% when compared to an even number.”
For example, Dan Bailey of WikiLawn says, “Facebook ads are our primary method of advertising at WikiLawn. We focus mainly on conversion rates and specifically getting the CPC as low as possible. Typically ours hovers around $0.10-$0.13.
My best tip for getting a good ROI is to really hone in on your audiences. We typically only aim for a range of 100,000-300,000 for each campaign. Anything smaller doesn’t have enough reach, but larger isn’t targeted enough. You need to gather data on your target customer and tweak settings until it reaches that number.
This is even easier if you use a pixel (or repixel), or if you’re advertising to a lookalike audience.”
“When you start building your Facebook Ads campaigns, try to keep your audience overlap to a minimum,” says Craig Smith, founder of Trinity Insight. “It’s common for marketers to create multiple ads where almost everything is the same except for one or two factors. As a result, these brands are bidding against themselves. This won’t help your CPC.”
“For example, say you wanted to promote an ad with a geographic focus; you wouldn’t build a campaign that targets Coral Gables in Florida and then another campaign that targets all of Miami-Dade County. Similar filters can be applied for age, interest, pages liked, and other factors.”
“I strongly recommend innovative creatives,” says Alejandro Rioja of Authority Daily. “Nothing can get you better results than having an attractive image accompanied by a creative description. Also, go for A/B testing and see which creative reaps the best results.”
Ivan Dimitrijevic of Four Dots says, “We often start with some ideas about what we are looking for and what will generate good CTR, thus CPC on Facebook. And after a series of testing, those creatives are refined to be a money-making honeypot. Good CPC or CPM is not enough, tracking user cohorts after they land on site/app, and their usage in-app is what separates good from a bad campaign.”
Noman Nalkhande of WP Adventure adds, “Utilizing a good media is a great way to increase CPC for Facebook ads. People scroll down aimlessly through their newsfeed, thus having a creative image that pops on the screen with the right color contrast helps in arresting the vision and increases the likelihood of getting the ad clicked.
Even using video is extremely beneficial as a lot of people keep the video autoplay feature turned on. A great video with a strong message will do wonders to your CPC objective.”
Editor’s Note: You can use this Facebook Video Completion Dashboard to track the effectiveness of your video ads and viewer reactions.
“Calculate your EAR or Estimated Action Rate,” says Andrei Vasilescu of DontPayFull. “When you’re going to run a cost-per-click campaign on Facebook, you must focus on your desired goal – clicks or conversion. After choosing your campaign target, Facebook uses its own algorithms to show your ads to relevant audiences who are supposed to take your desired action. Estimated Action Rate or EAR is the possible estimation of how much your audience is going to take that action you desire on your ads. High quality or relevant ads always get more actions taken by the target audience. So, you must try to evaluate the EAR of your Facebook ads right after bidding to estimate and optimize the CPC of your Facebook ad campaigns.”
“You want to entice your audience to take action and engage with your ads,” says Jonathan Aufray of Growth Hackers Agency. “You don’t need to be too descriptive with your ads. Instead, push people to click by adding a strong CTA (Call-to-Action). How? A great technique is by telling a story and building suspense. You can talk about the problem your audience is facing, and by clicking on it, they will find the solution.”
Lachlan Kirkwood of ClickThrough adds, “Although Facebook ads provide a variety of different CTA buttons, it’s important to include additional prompts, informing users of how they can physically take action after engaging with your ad.
If your ad objective is purely to drive traffic, including the link within the post copy itself allows users to easily interpret where to click.
It can also be effective to use the newsfeed description field to write your call to action in a way that users will clearly understand e.g. click the button to learn more.
Although it’s important to drive low-priced cost-per-clicks, brands should consider optimizing their bidding strategy for landing page views, ensuring that they only pay for users who actually visit a landing page, not just click an ad.”
“Most of the time, you want to sell the click instead of trying to sell the entire product,” says Jacob Landis-Eigsti. “You want your sales page to do the product selling and have the ad focused on driving people to that page. You can highlight product benefits, but also create curiosity and get people to visit the page. Approaching your ads in this way has cut our CPC in half.
While return on ad spend is by far the most important, we’ve seen a greater correlation between CPC and profit vs CPM. Any small audiences like website visitors will have higher CPMs but are often extremely profitable. Our top ads have had a high clickthrough rate and great cost per click.”
“Increasing click-through rate (CTR) will increase your relevance score and thus lower your Facebook ads cost,” says Michael Miller of VPN Online. “One way of increasing is by always using desktop newsfeed ad placement. These generate higher CTRs in the long run. You can also utilize more appropriate CTA buttons. The Learn More button is more pleasing to cold audiences that don’t trust you yet. Lastly, write a simple, clean copy that gets right to the point and doesn’t leave users guessing at what they’re clicking on or why they should.”
Yaniv Masjedi of Nextiva adds, “Optimizing your click-through-rate (or CTR) is one way of telling Facebook that your ad content is relevant to your targeted audience. When this happens, Facebook lowers your CPC since many audiences find it applicable to their life.
However, if many people don’t click on your ads, Facebook would think that you posted an irrelevant ad or one with poor quality. In this scenario, Facebook increases your CPC because your ad is not what your target audience wants to see.”
“Split the campaigns as per device targeting,” says Richa Pathak of SEM Updates. “CPC is much lower in the mobile device as compared to desktop. The image size is different; the visual content around the ad copy is different for all the devices. So, using a one-size-fits-all strategy doesn’t work well here. I would recommend dividing your campaign as per the devices and content placement, use the right images fits well into that place. I have tried this technique, and it worked great for me. It reduced my CPC on Facebook by 55% and also drove better traffic.”
Daniella Pozzolungo of PupDigital says, “Use the Facebook pixel and optimize for landing page views. Optimizing for landing page views is a much more lucrative metric than simply optimize for clicks. When you optimize for landing page views, Facebook will serve the ads to people who are more likely not only going to click on your ad but also wait for the landing page to load. This means you immediately get more value from every click you receive.”
“There are many ways through which you can optimize your Facebook advertisement,” adds Jennifer Willy of Etia. “This optimization is more than creating a niche and fan-base and installing Pixel software. Being smart is the only option for one to be successful in today’s digitized world. Similarly, it is important to schedule these Facebook ads. It won’t make any difference if your ad is running 24*7, it has to be effective to be impactful. You have to calculate and notice which time period is best for advertising your product/service. You have to find out which weekdays contribute to the most conversions at the lowest CPA and schedule your ads accordingly.
“I would say the number one way to optimize your Facebook ad campaign would be to optimize your landing page,” says Crystal Diaz of Xtractor Depot. “Many people forget to do this as you might think it’s all ready to go. Most of the time, we add or check to make sure we have CTAs, high rated keywords, and images that make sense.
Another thing I like to do is data segments. These are detailed re-targeting (people liking subjects and interests) options helps to grab people that are closely related to your topic/brand, instead of showing the ad to a broad audience.”
“We use Facebook Ads a lot and have found that making sure we target a custom audience is the best way to optimize our CPC,” says Jesse Silkoff of MyRoofingPal. “By taking the time to identify who our ad is for and using the Facebook Ad Manager settings to target our ad to that audience, we can make sure we get the absolute most out of our investment in Facebook ads.
Dave Hermansen of StoreCoach.com adds, “One of the most effective strategies that we use is building custom audiences based on their behavior on our website. In particular, we set up ad groups that re-target people who added something to their shopping cart on our website but did not buy as well as those who reached the checkout page and did not complete their purchase. Those tend to be the best-converting groups.
We also clone the people who have bought from us, telling Facebook to show ads to only people who have the same characteristics as those who have already purchased from us.
The key is to set up many, many segmented groups that are only slightly different. Once we nail the perfect set of characteristics, we scale up the ad spend for any group that has a positive return on investment. We scale back or completely eliminate showing ads to those groups that do not.”
“An effective way to lower your cost-per-click on Facebook ads is to leverage influencers and tastemakers in your creative,” says Engine eCommerce founder John James.
“One of the most effective ways we have found to do this is through leveraging the audiences of the influencers that rep your brand, and running ads directly from the influencer’s account or using their likeness to drive that CPC down,” says James. “It comes down to capturing attention, and if you can produce a video or picture with the audience’s favorite influencer, they are much more likely to engage with that ad and click through.”
“One of the best ways to optimize your CPC on Facebook Ads is by doing multivariate testing with your targeting and creatives,” says Supriya Agnihotri of SurveySensum. “ Instead of running 1 or 2 ads, run 8 to 10 different ads (different combinations of the main headline, ad copy, image, and CTA) to see which one is the most effective.
Multivariate testing helps you learn which ad creative, audience, delivery, or placement best meets your marketing goals.
So once you determine the most effective ad, increase your budget over time as you begin to improve your ROI.”
Ameet Khabra of Ameet Khabra Marketing Inc. says, “Test ad creatives. Facebook allows us to run different creative concurrently with the same ad budget. We may know our audience inside and out, but the tiniest thing in the creative can have a massive effect for results over the long term.”
CJ Xia of Boster Biological Technology agrees, “Images are the key part of Facebook ads, and it is one of the significant factors that help the user decide whether to click an ad or not. Test different images and find the one and use that optimizes the Facebook ad campaign. Use a high-resolution image and show your product or brand clearly in the picture. Try to avoid too much text in the image and crop tightly around the important part of the image.”
Andrew Becks of 301 Digital Media adds, “Effectively leveraging even the simplest of A/B testing can improve overall CPCs and help identify underperforming assets to either discontinue promotion of or update in an effort to improve future performance.”
Bernie Wong of Social Stand Limited says, “My advice to optimize the CPC of your Facebook ad campaigns is to run an A/B test with these two strategies: Emotional and Functional. Run both of these styles and see what does better. After the initial connection, retarget the same person with the opposite approach.
Eventually, you might find that one approach is better for your specific product/service, or you might find out that different clients react to different ads, and it’s worth it to keep both running.”
“There are two ways to do it,” says Mathew Peter of Ownage Fashion. “One is by switching on dynamic creatives to split test the ad. We do it the other way by creating three completely different ads for the same ad set. Then after three days, we turn off the worst-performing ad creatives. You can never go wrong with this method because Facebook automatically promotes ad creatives that perform best. If none of your creatives are performing well, you need to change the audience. You also need to have a specific KPI. For example, for us, the cost per click should be less than 0.35, anything above that is not acceptable.”
“Using the “Use Existing Post” on your Facebook ad campaigns can actually help you optimize the CPC of your campaign,” says Tom Massey of Snowy Pines White Labs. “This tactic helps create more likes and shares from one post, which will help increase the CPC of your campaign.”
“To optimize CPC on Facebook ads, as with all advertising, understanding and empathizing with your customer is the most important thing,” says Arwen Brenneman of Reliance Foundry. “We have a number of different customer bases, each with different needs. In marketing, we might call these pain points or consider the customer journey, but what it comes down to is respecting your customers as people and opening a conversation that’s relevant for them. Whether we’re offering content or ad copy, the point is to open a door so that those people who need us can find us and walkthrough. If you find your audience and offer them something of value, they’ll click.”
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