Determining a good cost per click (CPC) on Facebook ads can be tricky. The ideal CPC depends on many factors, including your goals, target audience, industry, and type of ad. While there is no one-size-fits-all answer, examining typical CPC benchmarks can provide a helpful starting point.
What is a good CPC for Facebook ads?
A good CPC on Facebook can vary greatly, but tends to fall within these general benchmarks:
- Industry average: $1 – $2
- Highly competitive industries: $3 – $4+ (e.g. insurance, loans)
- Brand awareness ads: $0.50 – $1
- Lead generation ads: $1 – $2
- Ecommerce product ads: $0.50 – $1.50
However, it’s important to note that these numbers are just rough guidelines. Your optimal CPC depends on your unique business goals and target audience.
What factors impact Facebook CPCs?
Several key factors can influence your average CPC on Facebook:
Your industry
Industry average CPCs vary widely. Highly competitive industries like insurance, financial services, and legal services tend to have higher CPCs. Less competitive industries like home services and retail tend to have lower CPCs.
Your target audience
Targeting broader audiences tends to result in lower CPCs. However, hyper-targeted or niche audiences often have higher CPCs.
Your ad objective
Ad objectives focused on conversions like lead generation tend to have higher CPCs than brand awareness or engagement campaigns.
Your landing page quality
Relevant, high-converting landing pages can help lower your CPCs over time.
Your ad creative
High-performing ad creative makes your ads more relevant, helping lower CPC.
Ad placement
Where your ads are shown impacts CPCs. The Facebook News Feed tends to have lower CPCs than the Instagram Feed or Stories placements.
Competition
High competition for your keywords, audience, and placements can drive up CPCs.
Bidding strategy
Bidding to optimize for conversions rather than clicks can increase CPCs but lower overall cost per conversion.
How can you optimize your Facebook CPCs?
Here are some tips to help optimize your Facebook CPCs:
- Test different bidding strategies to find the right balance of volume and conversion value.
- Analyze high performing ads to identify what makes them effective.
- Continuously A/B test ad creative, content, images, etc.
- Target engaged, high-intent audience segments.
- Improve landing page experience to lower bounce rates.
- Monitor changes and trends in your metrics using Facebook Analytics.
- Consider running ads on Instagram if CPCs are too high on Facebook.
- Use exclusions to weed out audiences unlikely to convert.
Should you focus solely on CPCs?
While CPC is an important metric, focusing solely on CPCs can be short-sighted. The goal isn’t just low CPCs – it’s acquiring high quality customers cost-effectively.
Instead of CPC, focus more on metrics like:
- Cost per conversion
- Conversion rate
- Lifetime value of a customer
- Return on ad spend
The best way to optimize is through multi-touch attribution modeling and maximizing the metrics that matter most to your business goals.
How low should you bid to get started?
When first starting Facebook ads, it’s recommended to bid low while testing to find the optimal CPC over time. Some guidelines on starter bids:
| Ad Objective | Starter Bid |
|---|---|
| Brand awareness | $0.05 – $0.10 CPC |
| Reach | $0.05 – $0.10 CPC |
| Engagement | $0.10 – $0.20 CPC |
| Conversions | $0.20 – $0.50 CPC |
| Catalog sales | $0.20 – $0.50 CPC |
| Traffic | $0.05 – $0.10 CPC |
Once you gain data, you can increase bids to find the optimal range for your goals. But starting low allows room to optimize later.
How do you calculate cost per click?
Figuring out your actual CPC is simple. Take your total advertising spend and divide it by the total number of clicks your ads received:
CPC = Total Ad Spend / Total Clicks
For example, if you spent $1,000 and got 500 clicks, your CPC would be $2 ($1,000 / 500 clicks).
When evaluating CPC, make sure to look at metrics for each individual ad and campaign separately. Aggregate CPC data can hide the high and low performers.
How can you estimate potential CPCs?
Facebook provides CPC bid estimates to help calculate potential costs before launching campaigns. Here’s how it works:
- Enter your targeting details.
- Select “Auction Insights” to view bid estimates.
- Apply your daily budget to see potential reach at different bid levels.
- Choose a bid based on your budget and goals.
However, these estimates aren’t perfect. Once campaigns launch, use performance data to optimize actual bids.
Should you bid high or low for conversions?
For conversion campaigns, bidding low may get you more clicks but lower conversion rates. Bidding high gets fewer clicks but more conversions.
Many advertisers find bidding mid-range gets a good balance. Start in the middle and adjust based on performance data.
Also consider tCPA bidding optimized for conversions vs. CPC bidding for clicks. tCPA aims to get conversions at the lowest cost instead of just cheap clicks.
What is CPC bidding vs tCPA bidding?
The two main bidding options for Facebook conversion campaigns are:
- CPC bidding – You pay per click based on your set bid. Lower CPC can mean more clicks.
- tCPA bidding – You pay to get conversions at your target CPA goal. Facebook automatically sets bids to optimize conversions.
tCPA bidding is recommended for optimizing conversions vs. just clicks. However, CPC can be useful for some goals like reach.
Should you bid high or low for engagement?
For engagement campaigns focused on likes, comments, shares, etc., most advertisers find lower bids perform better.
High engagement bids can often lead to poor quality engagement from people unlikely to follow through with desired actions later. Lower bids attract more selective audiences cost-effectively.
What is a good cost per click benchmark for Google Ads?
Industry benchmarks for Google Ads are similar to Facebook:
- Average CPC: $1 – $2
- Competitive keywords: $3 – $5+
- Brand terms: Under $1
- Informational: $1 – $2
- Transactional: $2 – $3+
However, keyword competition, searcher intent, and other factors can greatly impact CPCs. Similar optimization tips apply for lowering Google Ads CPCs.
What is a good conversion rate benchmark for Facebook ads?
Ideal Facebook ad conversion rates vary greatly by industry and campaign goal. Some average benchmarks include:
| Ad Objective | Good Conversion Rate |
|---|---|
| Lead Generation | 2% – 5% |
| Catalog Sales | 2% – 4% |
| App Installs | 1% – 3% |
| Engagement | 20%+ |
However, optimization to improve conversion value long-term is more important than strictly conversion rate.
How can you calculate cost per conversion?
Cost per conversion (CPC) helps tie ad spend to conversion value. To calculate:
CPC = Total Ad Spend / Total Conversions
For example, if you spent $5,000 and got 100 conversions, your CPC is $50.
Compare CPC over time and across campaigns to find the most efficient strategies.
Conclusion
A “good” Facebook CPC depends greatly on your unique business, goals, and audience. While industry averages provide a starting point, ongoing optimization based on performance data is key to maximizing results.
Carefully test different bid levels, but avoid fixating solely on CPC. Instead, focus on metrics like CPC and ROAS that connect ad spend to real business value.
With the right targeting, creative, and bidding strategy, you can achieve your desired outcomes cost-effectively.