Facebook Ads Get More Competitive
Facebook is becoming less of a novelty and more of a necessity for global brands, according to Efficient Frontier and Context Optional's Global Digital Marketing Performance Report for Q2 2011. Advertising on Facebook continues to get more competitive as brands on the social media site are on pace to double their fan bases since last year. Continuing with this trend, advertisers will likely increase their spend on Facebook in the upcoming year.
Context Optional analyzed 10 million Facebook fans and found that for every brand post there's an average of 100 comments in response. Brands with more fans receive more interaction. For example, 17,000 additional fans to a brand equals one more comment per post. This shows that there's certainly a viral effect to having more fans. More fans generally equates to more buzz about a brand.
Here are some additional findings from the report:
- Facebook advertising comprises nearly 5 percent of search budgets;
- cost per click (CPC) on Facebook increased 22 percent from the first quarter of the year; and
- search spend was up 8 percent in the second quarter of 2011.
If CPC keeps up with its current pace, this year it will see an 80 percent growth year-over-year. These numbers also indicate that Facebook's revenue from ads will double year-over-year. With the social media space growing so rapidly, marketers should consider focusing more effort on acquiring Facebook fans, with an emphasis on new ad formats such as sponsored stories to maximize social return on investment.
“We believe that Facebook CPCs will continue to rise at a double-digit pace for the remainder of the year, so brands would be wise to add social media marketing to their overall digital marketing spend sooner rather than later,” said David Karnstedt, president and CEO of Efficient Frontier, in a company press release.