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Agencies | Sep 13
Kiera Abbamonte on May 15, 2019 • 10 minute read
For most Facebook advertisers, the lower their cost per thousand impressions (CPM), the closer they can get to the goal of ad spend efficiency. When CPM drops, your cost per click, cost per acquisition, and cost per lead all typically decrease, too. In short, you get better returns on less ad spend.
But reducing your CPM isn’t as simple as ticking a few boxes. To make it easier, we talked to 24 paid marketers and gathered their tried-and-true tactics for lowering Facebook Ad CPM. Here’s what they had to say.
Editor’s note: Want to view your ad frequency and monitor your overall Facebook ad campaign performance in one quick dashboard? Download this Facebook Ads Campaign Performance dashboard for free, and see all the most important Facebook metrics in one view.
Among the paid marketers we heard from, there was one clear winning tactic—audience targeting—and it wasn’t even close. Nearly 70% of the people we spoke to listed targeting as the single most important factor for reducing CPM on Facebook.
As Steve Cross of iSynergy put it, “optimizing how you target and define your audience is the best and most efficient way for reducing CPM.”
There are a few reasons why targeting is so effective at lowering CPM. For one, Stephen Hart of Cardswitcher highlighted that higher conversion rates naturally mean lower costs for each click or acquisition. “As well as helping your Facebook Ads have a higher conversion rate, making sure that you’re targeting the right people will help to improve the technical performance of your campaign.” That means you’ll need fewer impressions to yield the same conversion results.
A1 Future Technologies’ Srish Agrawal added, “You want to have the highest click-through rate possible—and the more custom your ad campaigns, landing pages, and ad copy, the better your CPM will be as you target newer and smaller markets.”
As Maddie from McMahon Marketing explained, it’s a lot more cost effective to bring the right audience to Facebook versus letting Facebook define your audience through trial and error.
“Facebook will go out and try to find the right audience for your ad, but it’s going to cost you,” Maddie said. “If you do the work up front and give Facebook a blueprint of your target audience that they can build off of, you’ll see a noticeable difference in your CPM.”
If you aren’t sure what a truly targeted audience looks like, Facebook’s audience dial indicator can be a helpful guide—but not necessarily in the way you might expect. Many paid marketers aim to hit the sweet spot right in the middle, but Michael Alexis of Museum Hack actually recommends pushing the needle into the “too narrow” sector. “It admittedly reduces the number of people the ad will show to,” Alexis noted, “but also results in high clickthrough rates, a low CPM, and other positive metrics.”
Alpha Investors’ Andrej Ilisin explains that part of the reason targeting reduces CPM is because it ensures your ads only show to people they’re actually valuable for. “It decreases your costs when the content in your ad is valuable to the Facebook users that land on it.” When you focus on delivering value to the exact right audience, costs are lower, clickthrough rates are higher, and the overall efficiency of your ad spend improves.
Closely linked to audience targeting, increasing your relevance score was another common thread among the paid marketers we talked to. Faizan of WPBeginner shared, “For me, the most important factor for reducing Facebook Ad CPM is targeting. Because when you run ads that appeal to your target audience, you improve your relevance score.”
Andrew Schutt of Schutt Media explained, “When you focus on making ads that are relevant and engaging to your target audience, Facebook takes note of that and rewards advertisers by showing the ad to more people for less money—hence, lower CPMs.”
“If you get the Relevance Score right with your audience,” Schutt added, “you get more impressions for less money, the users are happier, and Facebook is happier. It’s a win-win-win.”
Colibri Digital Marketing’s Andrew McLoughlin noted how audience targeting, itself, can be a key to boosting your relevance score. “By targeting just those segments which you’ve identified as most likely to respond, with strong content and appropriate messaging, you can keep costs low and still get a significant response from your audience.”
In a more tactical vein, Max Reinhardt of Beacons Point suggests using a relevance score of 7 as a baseline. “If your relevancy score is lower than 7, consider narrowing your targeting and/or adjusting your imagery, CTAs, and general ad copy.”
Another common theme we heard from paid marketers revolves around testing. Namely, a lot of people recommend testing your Facebook Ads frequently and consistently—to ensure your CPM and other cost metrics are as low as can be at all times.
James Pollard of The Advisor Coach says testing their Facebook Ads is always worth the investment. “I’m always trying to create shareable content, so our message to be seen by more people at a reduced cost. It often takes several tries to get a huge winner but it more than pays for the rest.”
Online Optimism’s Taylor Kincaid echoed that sentiment, advising advertisers to “test your audience to make sure you’re speaking to the right people. You can even A/B test through the split test feature right in Facebook Ads.”
Kincaid added, “A good way to check if your audience is responding is by seeing if your relevance score is high.”
The key to finding actionable insights with your A/B tests is to start with an explicit hypothesis. What do you expect to happen? How do you expect the ad copy in version A to change CPM versus version B?
Ramón Franco of Plog’s process looks something like this: “Let’s test A/B with cycles of up to 7 days for each hypothesis, and let’s take these two key factors into account: CPM and CPL.”
“The idea,” Franco added, “is to make quick decisions until you find the CPM sweet spot you’re looking for.”
Editor’s note: If you need a simple way to compare ad campaigns, download the free Facebook Ads Purchase & Leads Breakdown template to view purchases and leads from Facebook Ads and compare spend and results across campaigns.
Gil Resnick of Repsly had some unexpected advice for lowering CPM on Facebook. “The best way to keep your CPM down,” Resnick said, “is to not pay for ads using CPM.”
When left to its own devices, Facebook tends to spend all of your set budget quickly—but not necessarily intelligently. As Seth Kravitz of Phlearn explained, “If you don’t set an ROI, Facebook will spend wildly, driving your CPA through the roof.”
“The algorithm is designed to generate maximum revenue,” Kravitz added, “no matter the cost.” Instead, Kravitz recommends using value-based targeting to reach an audience that’s still large, but without driving your costs through the roof.
And Resnick agreed. “CPM is a decent spend metric if you’re focused on getting your brand name out there, but Facebook has a tendency to spend your dollars quickly rather than efficiently.”
“Using landing page views as your paying point can help decrease CPM and drive more qualified leads to your page,” Resnick explained, “ because Facebook focuses on the people they think will find your ads most relevant.”
Of all the advice we heard from paid marketers, this tidbit is definitely the most universal. There’s basically no downside to better understanding your customers—and every business can stand to learn more about them.
Jonathan Aufray of Growth Hackers recommends making your Facebook Ads as personalized as possible: “To reduce your Facebook Ad CPM, create very personalized ads. Personalize the copy and visuals to your target.” Digital Now’s Marcin Nieweglowski echoed Aufray, adding, “If you know your Facebook ads are for, you won’t be worried about personalizing and niching down your audience. You’ll know what kind of copy, CTA, and creatives to use in your Facebook Ads.”
GreenPal’s Zach Hendrix noted they’ve seen phenomenal results from segmenting their Facebook Ads. “We thought, how can we make this more contextual and relevant to the viewer?” It enables them to be more specific and personalized, resulting in 200% higher CTR and a 30% lift in conversions on the linked landing page.
“Studying the data your own business generates,” noted Hendrix, “can tell you which of your online marketing campaigns works best.”
Trevor Henselwood of WebSavvy said it’s important for marketers to understand their audience for another reason, too—realistic goal setting. “CPM is a function of your vertical and your audience size, so you’ll never see the kinds of CPM that fast fashion has, for example, if you’re in the weight loss space.”
One of the more unique responses we heard recommended calling on your own tribe and network to help show Facebook how useful your ads are within that niche.
Kurt Uhlir of Showcase IDX said, “I’ve seen multiple campaigns at different companies reduce their Facebook Ad CPM by 80% just by forming a group of people that will react and comment on new ads.”
“After creating a new ad or series of ads,” Uhlir advised, “let your group know and ask them to engage if they find it relevant and useful.”
Explaining why that kind of engagement early on in an ad’s lifecycle can lower CPMs, Uhlir added, “This engagement will show Facebook’s algorithm that people find your content useful, and they’ll show it to more people.”
Nearly all of the advice we hear from paid marketers centers around building an audience for your Facebook Ads that’s as targeted and warm as possible. When that happens, you can squeeze more clickthroughs and, ultimately, conversions out of lower CPM.
One of the ways our experts suggest doing that is by using Facebook Ads for remarketing, instead of wider, brand awareness campaigns. “You take the same, the same offer and show it to a warm audience (like website visitors or a list of lost opportunities)—instead of an audience based on interests and behaviors—and you’ll get better results,” said Boundify’s Emilio Garcia.
Thomas Bosilevac of MashMetrics offered similar advice, sharing, “We implement several custom events for clients including video performance, time on page, scrolling, pages per visit, and other top and middle funnel items.”
“Once these start firing,” Bosilevac added, “you can create custom remarketing audiences based upon the data.”
Bosilevac recommended starting out by remarketing based on:
“Frequency measures how many times the same people saw your ad,” said Tusshar Aggarwal of Digi Elephant. “You want to keep that number as low as possible—because when the same people see your ad over and over again and don’t with it, that increases the CPM.”
Expanding, ExpertSure’s Olle Smith added, “You don’t want the same people viewing your ad multiple times and not engaging with it because that will reduce your relevance score.” And lower relevance means increased CPM and other costs. There are two main ways to decrease ad frequency. We’ve talked about the first part pretty extensively today—and that’s advertising to a smaller, more targeted, and warmer audience. The second part involves optimizing your ad copy, visuals, and CTA so they’re as effective as possible. That means more users will convert the first time around.
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