CPC vs. CPM in Facebook Ads: Understanding What You Are Paying For
If your ads are getting expensive, you need to know <i>why</i>. Is it because your ad is bad? Or is it because Facebook is just expensive right now? To figure this out, you need to understand the relationship between CPC (Cost Per Click) and CPM (Cost Per 1,000 Impressions).
Think of CPM as the "Rent" and CPC as the "Ticket Sales."
CPM (The Rent)
This is what Facebook charges you just to show up. It is determined by supply and demand. During Christmas, CPM goes up because everyone wants to advertise. You cannot control this very much.
CPC (The Ticket Sales)
This is what you pay for each visitor. You CAN control this. If your ad is exciting, more people click. If more people click, your Cost Per Click goes down, even if the Rent (CPM) is high.
The Formula
If your CPM is high (expensive rent) but your ad is amazing (high click rate), you can still get cheap clicks. But if your rent is high AND your ad is boring, you will go broke.
Fight High Costs with Creativity
You can't control the market price, but you can control your ad quality. Better ads act as a shield against rising costs. Stirling helps you build that shield.
