Should You Plan For a New Facebook CPM/CPC Bidding Strategy?

Why the image, you ask? Well sometimes working with Facebook ads can be like chewing on a cactus.

Not long ago, Facebook Ads went through their system and ’slapped’ or kicked out a bunch of accounts. Many affiliates were affected by this - and if they didn’t lose their account, they got their daily spend limit significantly lowered. Not only that, but they also sent out notice that they would get even stricter on enforcing their advertising guidelines in some areas.

Facebook is on a roll now, as they just sent out notification today of even more changes coming to their ad platform. Here is an excerpt of the notice they sent out;

Among other ongoing improvements, we are refining our ads delivery system to better reflect the goals of our advertisers. This change will take place over the next few weeks and, assuming current bids remain unchanged, will mean that:

- CPC advertisers (advertisers who have chosen to bid “cost-per-click”) may receive more clicks.
- CPM advertisers (advertisers who have chosen to bid “cost per thousand impressions”) will continue to receive impressions but may receive less clicks.

Do I need to do anything?
As a CPM advertiser, you are indicating to our system that it’s more important that your ad is seen by your audience rather than clicked i.e. you have chosen to pay for impressions, not clicks. If your main objective is to increase awareness of your business with an ad impression, there is no need for action. However, if your most important objective is to drive clicks on your ads, you should change your bids from CPM to CPC.

My immediate thought was pretty much; WTF?! I mean - yeah, traditional CPM banner advertising has often been used by big advertising agencies for large companies who focus on branding. So for them, the objective is to “increase awareness” and thus clicks and ctr matters less.

But CPM bidding these days has sort of become the new norm to which most online marketers I know have grown used to. All of these marketers, myself included, are looking for users to take an action - a click - on our ads. The CPC bidding on Facebook in particular has proven itself to be unreliable at best. (You are pretty much forced to bid really high to get worthwhile volume, and the actual CPC you pay seems a bit random when you compare identical ads with identical bids and ctr).

As it is today, a smart CPM advertiser can optimize their ads to the point where the ctr brings down the resulting click cost.

With the CPC route, if you wanna get your CPC below your EPC - it can become a challenge to find a good ad with a bid that both stays low enough - yet high enough to bring volume. This is why most guys I know only go with CPM bidding.

It remains to see whether this big change will be good news or bad news for us who actively advertise on Facebook. It also remains if Facebook will actually bring you more volume for the same bids - if you go CPC.

How do you guys think this change will affect traffic quality, conversions, and volume of your existing and future campaigns? Discuss…