Tag Archives: CPM

Previous blogs have discussed how Facebook algorithms have been changing to disable a bit of organic reach from business pages, a change that is not going down well with users but leaves them (and us) with no other choice sometimes. Just as it is another source of revenue for the social giant, many companies active on social have to start investing small amounts of money in order to keep getting the visibility they need, but without the creative wisdom of their marketing staff.

Although platforms other than Facebook offer different form of paid ads and billing options, this blog will explain the options we have and how much they cost. Many of you may have seen them by now, but it is a reminder of what’s out there, especially for new users.

Cost-per-click (CPC) – a billing option in which you pay for an ad placement when the viewer clicks on the ad.

Cost-per-thousand impressions (CPM) – a billing option for every 1,000 impressions of an ad.

Cost-per-view (CPV) – a billing option for every time someone views your ad. Some platforms also consider interactions with an ad as a view (such as clicks on the call-to-action buttons, cards or banners).

Cost per action/conversion (CPA) – a billing option for when someone completes the action you specified when optimizing the ad. Actions can include downloading an app, signing up for an email newsletter or making a purchase directly from the ad.

Cost per like – another billing option for every like obtained through the ad campaign or like given to an ad, photo or page.

The most commonly used options are CPC, CPM and sometimes CPA. They would be the ones most worth investing into as it is easy to track ROI.

What about the bidding? There are generally two options available; automatic and maximum.

Maximum bidding lets you decide how much you’re willing to spend to reach your objectives, while automatic bidding does it all for you according to your budget. Note that other platforms have other forms of bidding.

Next, how do you want to structure your budget, day to day or over an entire campaign? You have an option to choose either. However, there is always a minimum required to spend on a daily basis depending on the platform.

The amount you actually pay is determined by what’s needed for you to beat a competitor and have your ad placed. Each platform will charge you 1 cent higher than your competitor if you have the higher maximum bid. In general, the price you pay for social media ads is smaller than your maximum bid.

You don’t pay for the placement of your ad. You only pay when the user takes the action specified for your campaign (impression, click, like, etc.).

Have any more questions you’d like to ask us for your business? Feel free to reach out!