How to Lower Your Facebook CPM?
What is CPM?
CPM is short for Cost per thousand impressions. It is originally the acronym for cost per mille, which in Latin means thousand. This is considered to be the total amount one would pay for 1k impressions on their digital page.
Even though CPM is one of the most popular pricing models for online advertising, it doesn’t evaluate the effectiveness of a marketing campaign. For this reason, marketers tend to prefer tracking other metrics like their click-through rates or costs per click.
When focusing on the brand presence the number of clicks, leads, or sales the campaigns produce is not as significant. The main priority is getting the brand in front of as many online users as possible. Hence, why they pay by a thousand impressions.
How does Facebook calculate CPM?
What Facebook will do is take the total ad spend and divide it by the impressions it received. Then the value is multiplied by 1000 to get the cost of a thousand impressions.
For example, imagine you invest $95 on a campaign and you end up getting 15,000 impressions.
This means that your CPM will end up being $6.3 (CPM=1000*(95/15000).
Tips to reduce your Facebook Ads CPM
Broaden your Facebook Ads audience
One thing to consider when you want to lower your CPM is to broaden your digital audience. Generally, with Facebook ads, you don’t want to have too broad of an audience, but neither a too specific one. The idea with broad targeting is to let Facebook find your ideal customers and optimize further the campaigns. When using broad targeting you’ll going to target a much bigger audience and therefore your CPM will be much lower.
Check your ad frequency
A higher frequency is not only going to hurt your CTR and CPC but also CPM. If the same people are constantly seeing the same ad, they’re not going to engage with it. And because of that, your CTR will start to decrease, while the CPC and CPM will increase. Therefore, you need to constantly monitor your marketing campaigns to understand how the frequency is impacting them.
Improve your relevance score
Another thing to keep in mind is to create ads that are relevant to your target audience, so you can have a high relevance score. Your relevance score can go all the way from 1 up to 10 based on how much Facebook thinks your audience is relevant and interested in your ads.
Basically, if your target audience engages with your ads, the relevance score of your Facebook ads increases. And a higher relevance score means higher CTR, and eventually, lower CPC and CPM.
Use automatic placements
Another way to help reduce your Facebook Ads CPM is to use automatic placements. Different ad placements will have different costs, so the more competition a certain placement has, the higher the CPM.
Choose the right campaign objective
To choose the right ad objective, think about what your business goals are. Or better to say, what the goal of your campaign is. Is it sales on your website, downloads of your app, or subscribers to your blog?
So if your ultimate goal is to drive more sales, then the conversions objective would be the one to go with. On the other hand, if you want to encourage people to sign up for your newsletter, Lead generation would be the appropriate objective to use.