facebook advertising performance by webtrends jan11

8/7/2019 Facebook advertising performance by webtrends jan11

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WHITEPAPER / JANUARY 31, 2011

Faceboo k A dve rtis in g P e rfo rm an ceB enchm arks & In s igh ts

EXECUTIVESUMMARY

Facebook advertising is predicted to hit US$4 billion this year, which is

twice the volume of 2010 spending according to eMarketer. While brands

are rapidly investing in the space, they lack comparative experience to

assesshow well their campaigns are performing. Webtrends has analyzed

over eleven thousand campaigns to provide performance benchmarks

brands can use to evaluate their own campaign performance.

LOTSOF AD DATA

Webtrends has amassed a large

data ba se o f Face book adv ertis-

in g campa ig n resu lts. H ere a re afew stats on the volume of data

ana ly zed fo r th is r epor t.

4.5 billion impressions

2.2 million clicks

11.2 thousand ads

1.5 thousand campaigns

The Webtrends database is a very large sample given

the relatively young age of the Facebook ad network

(see the stats at left). We focused on a few key metrics:

• Click-Through Rate (CTR)

• Cost per Click (CPC)

• Cost per Thousand (CPM)

• Cost per Fan (CPF)

LESSCLICKSFOR MORE MONEY

From 2009 to 2010 the average CTRdropped while the

costs increased. This is a typical pattern for display ad

networks as the audience becomes more savvy and

demand causes prices to rise. Brands investing now

will save money building their Facebook ad programsnow by taking advantage of currently low rates that

will continue to increase over time. Facebook's top

advertisers have increased their ad spend 10 fold.

OVERALL CAMPAIGN PERFORMANCE AVERAGES FOR 2009-2010

YEAR CPC CPM CPFCTR

2009 0.063% US$ 0.27 US$ 0.17 N/A

2010 0.051% US$ 0.49 US$ 0.25 US$ 1.07

mailto:[email protected]


http://www.webtrends.com/





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18-24 25-34 55-64 65-10035-44 45-54

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AGE AND GENDER INCREASE OUR CTR

Age and gender appear to have a direct impact on how much we click on

Facebook ads. The older we get, the more we click; that is until we reach

65. Women are just as likely to click as men when they are 18-24, but

grow more likely to click with age.

STATE HAS LITTLE TO NO IMPACT ON CTR

While geographic targeting plays a strong role in delivering the

appropriate content to local audiences, it has virtually no impact on the

rate at which people click on ads. There are a few exceptions:

• Hawaii has a noticably lower CTRat almost half the average

• North Dakota and Wyoming have CTRsthat are double and triple

the average

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He alt h Ca re

I nt er ne t a nd So ft war e

Co nf er en ce a nd E ven ts

G r oce ry S tor es

Telecommunications

F inanc ial Se rv ices

Loca l Se rv ices

Ho us in g a nd Re al E s ta te

Misc.

Co ns ume r P a ck ag ed Go od s

Restaurants

Retailers

Cosmetics

S ta rt U ps

Non-profits

Automotive

Travel

E-commerce

Med ia and En te rt ai nmen t 0.154%

T a blo id s a nd B lo gs 0.165%

0.10 0.05

«CTR CPC»

00.0 0.3 0.6 0.9 1.2 1.5

0.011% ••••••••••••••• $1.27

0.021% ••••••••••••• $1.03

0.028% •••••••••• $0.67

0.029% ••••••••••• $0.79

0.029% •••••••••• _ $0.82

0.030% ••••••••••• $0.80

0.033% •••••••••• $0.67

0.058% ••••••••••• $0.56

0.058% ••••••••••• $0.54

0.065% •••••••••• $0.38

0.066% ••••••••••• $0.53

0.070% ••••••••••• $0.50

0.072% •••••••••• $0.37

0.074% •••••••••••• $0.50

0.077% •••••••••• $0.29

0.082% •••••••••• $0.26

0.086% ••••••••••• $0.36

0.089% ••••••••••• $0.31

••••••••••••• $0.25

••••••••••• _ $0.12

SOCIA L B RA NDS P ERFORM B ETTER

In a recent international survey by DDB,fans stated that they arestill primarily on Facebook for fun. Therefore it stands to reason that

industries that are fun to discuss with our network are seeing higher CTR.

F A CEB OOK REWA RDS SOCIA L B RA NDS W ITH CHEA PER P RICES

Brands that are social get a higher CTR,which translates into better

engagement metrics: Post Quality Score, EdgeRank, Feedback Rate, and

others. In turn, Facebook rewards such behavior with a lower cost per

click and greater visiblity in the News Feed.

webtrends



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0.043%

Interest

0.057%

0.049%

0.023%

FoF Interest FoF

A VERA GE CTR OF TRA FF IC THA T

D IDN 'T A TTEND CO LLEG E

A VERA GE CTR OF TRA FF IC

THA T A TTENDED CO LLEG E

WHA T IMP ACT DOES EDUCA TION LEVEL HA VE ON CTR?

For this analysis we used a subset of ads that specifically targeted

education levels.

EVERYONE CLICKS MORE IF A FR IEND LIKES A N A DThe bottom line is that regardless of education level, everyone clicked

more if an ad had a friends' name appear at the bottom of the ad.

F A NS THA T D IDN 'T A TTEND COLLEGE CLICK ON MORE A DS

All things being equal, fans that didn't attend college were more likely to

click on ads than fans who did attend college.

F ANS THA T A TTENDED COLLEGE A RE TW ICE A S L IKELY TO CLICK IF A

F RIEND LIKES IT

Sure, the fans who attended college have a lower CTR,but if you usefriend of fan targeting, then the CTRmore than doubles. It was the largest

impact when comparing education level on interest and friend of fan

targeting, which suggests that social endorsement means more to fans

with a college background.



BENCHMARKS

All of our ad stats created very smooth distribution curves, which tells

us that the sample size was statistically sound. These benchmarks will

help you determine where your ads stack up making it easier for you to

know when to high five your coworker and when it's time to go back to

the drawing board. The inflection point is middle of the curved portion of

the line and is a good line of demarcation to say that if you're above the

inflection point, you're doing well. Remember, most ads are below the

inflection point.

1

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0.8

0.7

0.6

0.5

0.4

0.3

0.2

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CTR DISTRIBUTION

INFLECTION .082%

CPC DISTRIBUTION

INFLECTION US$0.83

30~---------------------------

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CPF DISTRIBUTION

INFLECTION US$1.75

CPM DISTRIBUTION

INFLECTION US$0.52

webtrends



webtrends851 SW 6th Ave., Suite 1600

Portland, OR972041.503.294.7025

fax: 1.503.294.7 130

Webtrends Sales

1.888.932.8736

[email protected]

Europe, Middle East, Africa

+44 (0) 1784415700

[email protected]

For offices worldwide, visit:

www.Webtrends.com

ABOUT THIS REPORT

This report contains analysis of over 11 thousand ads and is intended

to provide market reference for Facebook ad performance. It is worth

noting that the majority of campaigns we analyzed were focused on fan

acquisition, which may skew some of the results. Benchmarks may vary

for campaigns aimed at websites or fan nurturing campaigns. We did

not have a statistically significant data set for the 13-17 year old market,

so we excluded them from our results. Industry results were based on

categorizing campaigns in our dataset, which means some industries

had only a single brand and may not be representative of an industry's

performance overall.

Special thanks to Dennis Yu, Nicholas Davies, Jonny Chan, Michael Girard,

and Tim Mather for their contributions to this report.

CITATIONS

Facebook Advertisers Boost Spending 10 Fold, COO Says; BusinessWeek;

http://www.businessweek.com/news/2010-08-04/facebook-advertisers-

boost-spending-10-fold-coo-says.html; August 2010

Facebook Drives USSocial Network Ad Spending Past $3 Billion in 2011;

eMarketer; http://www.emarketer.com/Article.aspx?R=1008180; January

18,2011

Facebook and Brands survey; DDB & Opinionway; https://

ddbworldwide-dropboxaliciabrindak2.pbworks.com/f/

DDBOpinionwayFacebookenglishshortversion.pdf; October 18, 2010

ABOUT WEBTRENDS

Webtrends is a global leader in social and mobile marketing. Thousands

of global organizations, including Microsoft, Reuters, General Mills and

Ticketmaster have chosen Webtrends business solutions and client

services expertise to optimize their customers' online experiences.

Webtrends was the first web analytics company, founded over 15 years

ago and continues to deliver world class analytics solutions.

Webtrends is a registered trademark of Webtrends Inc. in the United

States and other countries. All other trademarks and registered

trademarks are the properties of their respective owners.

© 2011 Webtrends Inc. All rights reserved.



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facebook advertising performance by webtrends jan11

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