Facebook Advertising Pricing: How Much Does It Cost to Advertise on Facebook in 2023?

Methodology

We asked over 270 marketers to share how much their companies spend on Facebook advertising. Keep reading to discover their answers.

Advertising on Facebook has become a trusted strategy for businesses worldwide with around 7 million advertisers active on the platform. If you’re thinking about promoting your company on Facebook, however, you probably have one question: How much does Facebook advertising cost?

Watch the video below to learn the basics of Facebook advertising, and keep reading for more information about the price of Facebook ads, including how much Facebook ads cost for other bidding models, like cost-per-like (CPL) and cost-per-download (CPA).

If you want to lower your ad costs and improve your social media advertising strategy now, talk with our award-winning strategists. With a client retention rate of 91%, we are the trusted choice for businesses worldwide.

Call us at 888-601-5359 or contact us online to learn more about our results-driven strategies!

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Facebook advertising pricing basics

Looking for a quick overview of Facebook ad costs? We asked 270 marketers how much their companies spend on Facebook ads. Here’s a quick summary of the basics below:

Key takeaways

• 81% of business are happy with the return on investment (ROI) they receive from Facebook ads
• 63% of businesses spend $1.00 – $500.00 per month on Facebook ads
• 62% of businesses spend $0.00 – $1.00 per like for Facebook ads
• 58% of businesses spend $0.00 – $1.00 per click for Facebook ads
• 53% of businesses allocate 0% – 15% of their overall advertising budget to Facebook ads
• 48% of businesses spend $1.01 – $5.00 per 1000 impressions for Facebook ads

How much does Facebook advertising cost?

Facebook advertising costs, on average, $0.26 – $0.30 per click, $1.01 – $3.00 per 1000 impressions, $0.00 – $0.25 per like, and $0.00 – $5.00 per download. How much you pay for Facebook ads depends on several factors, like your audience, ad budget, industry, and more.

[Summary] Facebook ad pricing

It’s important to note that these numbers are only averages. Your business may see higher or lower Facebook ad costs due to several factors, like ad placement, target market, industry, and more.

That’s why you want to use these amounts as a point of reference, rather than as a standard, for your company’s ad campaigns on Facebook. If not, you risk setting unrealistic expectations for your campaign, which can result in poor performance and unhappy company decision-makers.

How does the Facebook ad auction work?

Before exploring the different factors that influence how much your Facebook ads costs, it’s helpful to review how the Facebook ad auction works. Once you know how Facebook operates its ad auction, you can start optimizing your Facebook ad costs.

Here is an overview of the steps leading up to the Facebook ad auction:

• Advertiser logs into Ad Manager to create a campaign and ad
• Advertiser chooses their daily budget (or the maximum they’ll spend each day)
• Advertiser selects what action they’ll pay for, like views, clicks, or downloads
• Advertiser builds its audience using demographic, interest, and device targeting
• Advertiser adds their creatives, like their ad copy, images, and video
• Advertiser approves and launches their ad

Once there’s a chance to show an ad, the Facebook ad auction happens:

• Facebook grades every potential ad’s bid, estimated action rates, and ad quality
• Facebook uses estimated action rates and ad quality to determine ad relevance
• Facebook generates an ad’s total value, based on bid, estimated action rate, and ad quality
• Facebook delivers the winning ad — or the ad with the highest total value

Based on the ad auction, you can tell which metrics matter most to your ads and their costs:

• Ad bid
• Estimated action rate
• Ad quality
• Ad relevance

If you can optimize these metrics, like by improving your ad’s quality and relevance to users, you can lower how much your Facebook ads costs. Facebook even says that ads with the most relevance cost less and get more facetime with users.

Keep reading to learn more about these metrics and how to optimize them, below.

Learn How to Create Facebook Ads

What determines Facebook advertising costs?

Like pay-per-click (PPC) advertising costs on Google Ads, a variety of factors impact your Facebook advertising costs. If you want to build a realistic budget for your business, then you need to understand how these factors influence the cost of Facebook ads.

The eight factors that determine how much Facebook ads cost include:

1. Audience
2. Ad Budget
3. Ad Bid
4. Ad Objective
5. Ad Placement
6. Ad Quality
7. Season
8. Industry

Learn more about each of these factors now:

1. Audience

An in-depth study by AdEspresso on Facebook advertising costs revealed that your target audience has a significant impact on the prices of your Facebook ads. Whether you’re focusing on a specific age, gender, or interest, you can expect a shift in your ad expenses.

For example, if your ad campaign targets women, your CPC may increase by $0.55. That’s $0.15 more than if your ad campaign targeted men. When you look at age, ads that target individuals 55-65 years or older tend to have substantially higher costs than campaigns focusing on users 25-34 years old.

That’s because Facebook only has 26 million users between the ages of 55 and 64. While that may seem like a high number, it doesn’t come close to the more than 58 million people (between the ages of 25 and 34) that use Facebook.

When you advertise on Facebook, you can also target specific interests or audience attributes, including:

• Outdoor recreation
• Meditation
• Philanthropy
• College football
• Commuters
• And more

This useful feature can impact how much it costs your business to advertise on Facebook, as you may target high-value attributes or broad interests. For example, if you target frequent travelers, versus frequent international travelers, you have a broad audience that may incur additional expenses.

While high-value attributes can help you reach your specific market, broad interests can inflate your target audience with low-value users. Since these users often click on your ads, but don’t act on your calls-to-action (CTAs), targeting them can result in a low-performing campaign.

Focus your campaign on the people that matter and offer the most value to your business. You don’t want to pay for clicks or views that offer zero value when it comes to your long-term goals, like driving a sale or generating a lead.

2. Ad budget

When you launch an ad campaign on Facebook, you set an advertising budget.

No matter your budget, whether it’s $200 or $800 per month, it will impact how much Facebook advertising costs your business. If you set a budget of $200, that affects your ad bids, ad performance, and the overall results of your social media advertising campaign.

As an example, if your company launches an ad campaign with a $100 monthly budget, you may set a maximum bid of $1 per click. As the average CPC for Facebook ads is $0.94, it’s easy to see that your bid isn’t competitive and will probably result in a low number of impressions and clicks.

Not to mention, social media strategists recommend a daily budget of at least $5 for businesses. If you’re spending $5 a day on your campaign, however, you’ll use up your $100 budget by day 20. With this amount of funding, you don’t have the money to even run your ad campaign for the month.

While a large ad spend provides your business with additional flexibility, you can still make a small budget work for your company. Your company decision-makers need to realize, however, that a low ad budget provides fewer conversions because of its performance limitations.

3. Ad bid

Your ad bid also impacts the cost of Facebook ads. Facebook offers a few bidding strategies, including:

• Lowest cost bid strategy: This option, also known as automatic bidding, helps your business achieve the lowest possible cost per click or action. It also aims to make efficient use of your budget, which is why companies tend to start with this strategy.

• Target cost bid strategy: This option, also known as manual bidding, works to reach your desired cost per click or action. You can only use this strategy for app install, conversion, lead generation, or product catalog sale campaigns.

Depending on your bid strategy, as well as bid amount, you may have higher or lower Facebook advertising costs. In most cases, manual bidding comes with higher advertising costs, while automatic bidding tends to make the most of your budget.

Before you decide on a bidding strategy, it’s vital that you understand how the ad auction works on Facebook. When you understand the algorithm behind the company’s advertising services, you can build a better ad strategy and advertising budget.

In an ad auction, Facebook rates each bidder (and their ad) with these three factors:

• Bid: A bid is how much you’re willing to pay for a user to interact with your ad. For example, you may bid $1.50 for every click. According to Facebook, your bid is one of the most powerful tools for improving your ad’s performance.

• Estimated action rates: Your estimated action rates demonstrates the likelihood of users to interact with your ads, like by clicking on your ad or downloading your app. For a competitive ad, you need a high estimated action rate, which means creating a relevant ad for your audience.

• Ad quality and relevance: The positive and negative interactions of users with your ad determine its quality and relevance. A high ad quality and relevance score can improve the success of your ad in auctions.

If your ad comes away with the highest total value (based on the above three factors), you win the auction. In response, Facebook shows your ad, rather than a competitor’s, to the person in your target audience.

While an aggressive bid can increase your total value, it also raises your Facebook advertising costs. That’s why your business wants to focus on creating a relevant, high-quality ad first. Then, you can assess your bidding strategy and bid investment.

4. Ad objective

When you create an ad on Facebook, you need to choose one of the following main ad objectives:

Once you pick your main objective, you need to select a specific goal:

• Awareness
• Consideration
• Conversions

In most cases, more valuable ad goals, like a store visit or product purchase, lead to higher ad costs. That’s because these actions, like a product purchase, have immediate value for businesses. A product catalog sale, for example, generates immediate revenue for your company.

As you build your ad campaign, however, it’s important to remember the value of brand awareness and consideration. When you reach and connect with users in the early stages of the buying funnel, you can grow their interest in your brand and move them further down the sales funnel, resulting in a purchase.

Even though this action occurs later, it offers your business real and tangible value. It can also decrease your Facebook advertising costs, as most companies pay less for awareness- and consideration-related goals than for conversion-related goals.

The only difference is the turnaround time for a conversion. With a conversation-related goal, you connect immediately with a user looking to buy. In comparison, users in the awareness and consideration stage need a little more time before converting.

5. Ad placement

Ad placement also shapes the cost of Facebook ads. With Facebook, your ads can appear in six spots:

• Instagram
• Instagram Stories
• Facebook desktop newsfeed
• Facebook right column
• Facebook Messenger
• Audience Network

When it comes to social media advertising, Facebook offers a competitive advantage with its ownership of Instagram. Via Facebook, you can create Facebook and Instagram ads with ease, which saves your team time.

Instagram

Instagram maintains the highest CPC when it comes to Facebook advertising costs. On average, companies spend an additional $0.80 per click to appear on Instagram. For Instagram Stories, the CPC increase is around $0.78.

Facebook

The average CPC for ads on Facebook is around $0.30 less than Instagram. It offers a versatile platform for advertising your business. Your ads can appear not only on Facebook, but also Facebook Messenger, a popular messaging app for the social media network.

Audience Network

The Audience Network, which allows your ads to appear on websites and mobile apps, maintains an even lower CPC than Facebook and Instagram. In most cases, companies spend an additional $0.20 (based on the average advertising cost for Facebook) per click.

While you can modify where your Facebook ad appears, Facebook recommends Automatic Placements. This tool allows the social media platform’s delivery system to make the most of your ad spend by placing your advertisements on platforms that offer the most potential for results.

If you want to reduce your Facebook advertising costs, however, you can turn off this feature. When you turn Automatic Placements off, you enable your team to select where you want your ad to appear, whether on Facebook, Instagram, or the Audience Network.

6. Ad quality

The quality and relevance of your ads (as rated by Facebook) also affects how much Facebook advertising costs your business. If you create ads with a high relevance and engagement score, you will see lower ad costs.

Hootsuite demonstrated the power of an ad’s quality or relevance score in a recent study. The company created two versions of the same ad: one with a relevance and engagement score of 2.9 and another with a relevance and engagement score of 8.

The low-scoring ad had an average CPC of $0.14, while the high-scoring ad’s CPC was $0.03.

When it comes to your relevance and engagement score, your ads can receive a rating between 1 and 10. Ten is the best possible score, while one is the worst possible score. Facebook assigns a relevance and engagement score based on positive and negative ad feedback.

If you want to make the most of your ad spend on Facebook, it’s critical for your team to create ads with high relevance and engagement scores. For the best results, monitor your relevance and engagement score on a routine basis.

Access your relevance and engagement scores with the following steps:

• Go to Ads Manager
• Select the ad you want to view
• Choose the Columns dropdown menu
• Click Customize Columns
• Select Relevance Score
• Hit Apply
• View your Relevance and Engagement Score

Keep in mind that Facebook requires around 500 ad impressions or views before assigning a score.

As long as your ad is live, Facebook will continue to monitor user interactions, determining if it’s relevant. That’s why you need to check-in and adjust your ad to feedback regularly. With this proactive approach, you can improve the performance, results, and costs of your Facebook advertising campaign.

7. Season

The time of year can also impact how much Facebook ads are.

In peak shopping seasons, businesses tend to spend more on advertising. The increased demand for ad space results in a competitive marketplace, which can lead to aggressive bids and bigger campaign budgets that inflate the cost of advertising on Facebook.

A few of the most expensive days to advertise on Facebook include:

• Thanksgiving
• Black Friday
• Cyber Monday
• Christmas
• Boxing Day
• New Year’s Eve
• New Year’s Day

While seasonal factors can increase your Facebook ad costs, your business probably wants to take advantage of increased demand from consumers. In response, you may increase your budget for those high-demand months or audit your ad strategy to improve the quality of your ads.

8. Industry

While the average cost of Facebook ads is $0.94, you can gain more insight into your expected Facebook advertising costs by looking at the average price of Facebook ads for your industry. This data offers a more accurate estimate, which can help your team build your social media marketing budget.

Find out how much Facebook ads cost in your industry below:

Depending on your industry, Facebook advertising can offer a cost-effective option for building brand awareness, generating leads, driving conversions, and more. Even if you’re in a competitive market, like consumer services, you can benefit from a social media strategy.

Competitors in your industry advertise on the social media platform because they get results from it, whether it’s more followers on their social media page, purchases from their online store, or calls to their physical location.

It’s also helpful to mention that these prices for Facebook advertising are averages.

That’s why you should only use these numbers as benchmarks for your business. When you adopt this perspective, your team and company’s decision makers can approach your campaign with realistic expectations.

Are Facebook advertising costs worth the price?

For the majority of companies, the answer is yes. In fact, 81% of businesses say they are happy with the ROI they receive from Facebook ads.

For companies that can generate a return on investment from Facebook ads (which can take trial and error), Facebook advertising is worth the price.

Tools that can improve your ad campaign targeting, like AdTechFX via MarketingCloudFX, can help your business improve its paid advertising performance by reaching the audience members closest to your ideal client.

Free Guide from Our Experts

Are You Spending Your Marketing Budget Wisely?

Download our guide to learn how to plan your budget, set goals, track performance, and more!

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Get better results from your Facebook ads

Looking to improve your ad campaign performance, as well as decrease your Facebook advertising costs?

Partner with WebFX, an award-winning digital marketing and advertising agency that offers social media management and social media advertising services. Whether you’re looking to build brand awareness, discover qualified leads, or generate sales, our decades of experience and AI-powered software can help.

Learn more by contacting us online today or call us at 888-601-5359!