Facebook Advertising in the Time of Stories

Summary

Apart from being the most widely used social media platform, Facebook is also one of the most popular digital advertising platforms. In this post, we would look at Facebook advertising platform’s performance over the last year through benchmark reports published by Nanigans and Adstage. This report might not be exactly true to the Indian market, but it would indicate some trends as follows:

  • 61% of advertisers spend go into video ads.
  • By objective, Facebook advertising can be categorized into three major categories- App install, lead generation and transaction.
    • The CTR for app installs is lower than lead generation and transaction campaigns while the CPC is highest.
    • Lead Generation ads have higher CPM than app install and transaction campaigns and CTR lower than transaction campaign.
    • Transaction campaigns are the best performing campaign on Facebook with highest CTR and lowest CPM and CPC.
  • The three main ad placements are: Newsfeed, Facebook Audience Network and Messenger.
    • The CTR for ads placed in Newsfeed are the highest. The CPM for ads placed on newsfeed is highest too while CPC is comparable to Facebook Audience Network.
    • Ads placed in Facebook Audience Network have lowest CPC.
    • Ads placed in Facebook Messenger have the lowest CTR.

Is Facebook Stories the new favourite ad placement for advertisers?

According to Nanigans, Newsfeed ads still make the majority of Facebook ads, but Facebook Stories ads are rapidly gaining popularity among the advertisers.

Where does Advertisers’ money go- Video ads or Image ads?

According to Nanigens, in Q4 2018, about 61% of ad spend was video ads.

Which are the most popular three categories of advertisers?

According to Nanigans, the three most popular categories of advertisers based on their ad objective are:

  • App Install: These are mostly apps from gaming, entertainment and on-demand services.
  • Lead Generation: These are mostly companies that sell high ticket items like banking, auto, insurance, real estate
  • Transaction: Retailers and travel websites that have a large spread of products online

Does the benchmark CTR, CPM and CPC show the same behaviour across all three ad objectives?

There are many factors that define the CTR, CPM and CPC for Facebook advertisements but if one has to focus on the advertising objectives, the ad performance varies across the objectives:

  • For Q4 2018, the global average CTR was 1.50%, lowest being 0.55% for app install campaigns whereas highest being 2.34% for transaction campaigns. The average CTR for lead generation campaigns was 1.27% Following is a snapshot from Nanigans’ report showing CTR behaviour over the last one year. Though global average CTR showed a growth over the period of a year, there was a drop in CTR in lead generation whereas CTR for app install and transaction has remained the same.
  • For Q4 2018, the global average CPM was $9.64, lowest being $6.48 for transaction campaigns whereas highest being $14.37 for lead generation campaigns. The average CPM for app install campaigns was $9.77. Following is a snapshot from Nanigans’ report showing CPM behaviour over the last one year. Though global average CPM showed a growth over the period of a year, there was a drop in CPM in lead generation and transaction whereas CPM for app install had increased.

  • For Q4 2018, the global average CPC was $0.63, lowest being $0.2 for transaction campaigns whereas highest being $1.79 for app install campaigns. The average CPC for lead generation campaigns was $1.13. Following is a snapshot from Nanigans’ report showing CPC behavior over the last one year. Though global average CPC showed a decrease over the period of a year, there was an increase in CPC in lead generation and app install whereas CPC for transaction had decreased.

How do the Benchmark CTR, CPM and CPC vary across Ad Placements?

There are three main placement options for Facebook advertisements- Newsfeed, Audience network and Messenger. Following is the CTR, CPC and CPM benchmarks across last one year by Adstage:

Are there any variations in Benchmark CTR, CPM and CPC across geographies?

Yes, benchmark CTR, CPM and CPC do vary across markets. Following is a snapshot of CTR, CPM and CPC across geographies over the last year.

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