It’s clearer than ever that the future of Facebook ads is about getting hard ROI from the News Feed - and the News Feed is changing fast.
Looking through Socialbakers’ Facebook® advertising data from 2014, you can see how marketers began to favor placing video ads in the News Feed for a directly reportable ROI – and how they're still leaving value on the table. Let's take a deeper look into how things changed last year, and where they can go this year.
Take a look at this chart, which shows how much of marketers’ budgets went to different key Ad Objectives last year.
You can see that budgets are trending toward ad objectives with clear value, while beginning to divert from less directly valuable goals like Page Likes. Most of that money is going to getting Video Views, Website Clicks, and Mobile App Installs. These produce direct, reportable ROI, as does Post Engagement.
Video Views in particular will really bear watching in 2015. Embedded videos in the News Feed are still relatively new, but already about 5% of Facebook ad budgets are dedicated to attracting Video Views. There’s no reason to think this slows down any time soon – videos get the best reach of any post type in the News Feed. The Facebook News Feed is steadily replacing YouTube as the go-to destination for video posting.
Smarter Social Targeting
But a major percentage of ads are still not set with any objective, meaning they are being boosted, but not targeted. The good thing is that that number has dropped drastically throughout the year, meaning marketers’ understanding of social ads and targeting is maturing. In Q4, ads were only auto-boosted 27% of the time, taking up 14% of ad budgets. That’s down from 40% and 26% respectively in Q1.
Even the best-placed ads need to reach the right audience, though. Too few ads are as well targeted as they should be. 85% of the 300,000 ads we analyzed were targeted by country instead of by specific locations, and in December 2014, only 44% of the ads we analyzed used interest targeting. While this is up from the 36% benchmark we’ve seen in our ad bank historically, it's still far too low. Brands need to pay attention to who is seeing their ads in order to get the best potential ROI.
It is also useful to look at custom audiences. Custom audiences were set in about 26% of all ads, and had a high CPC – but, due to how highly-targeted that field is, these ads were likely looking at much more value per click as well.
Here’s the breakdown of how advertisers targeted their ads in December 2014:
Women were consistently targeted more than men at each age group, and delivered higher CPM, CTR, and lower CPC.
For both men and women, youth means a lower cost per click.
Efficiency and Efficacy in the News Feed
If video content in the News Feed is the biggest growth area for Facebook marketers, it’s for good reason. Click-through Rates (CTR) and Cost-Per-Click(CPC) data from throughout the year show the News Feed is undoubtedly the most effective place for marketers to place paid content.
According to our data, the News Feed (Desktop and Mobile) choice was both the cheapest per-click and the most successful placement in 2014.
This dominance is showing up in the spend numbers – it now makes up the largest part of marketing budgets.
Our data shows that Website Conversions and Mobile App Installs have seen the biggest growth in dedicated ad spend. Again, this is all about marketers recognizing the value of mobile-first, native ads.
Trends for 2015
Marketers and executives are finally starting to tie social growth into business value, rather than build up their audiences for the sake of having empty statistics to report. That’s the mark of a maturing social environment (if only brands would take social customer care as seriously!) In 2015, we see video-focused ad campaigns run mainly on the Facebook News Feed hitting a new level of value for social marketers. With the combined growth of Mobile App Installs and Video Views as ad objectives, it seems clear that mobile-native videos are going to be the immediate, valuable future of social media advertising.
But that extremely high level of value may not last long, when more brands start catching on and so many video posts get published that their great reach drops – so get to putting those videos up, now! As Facebook has already overtaken YouTube for video publishing, the window for getting in on the ground floor may already be closing.
Facebook® is a registered trademark of Facebook, Inc.
You May Also Like
Everything You Need to Know About Instagram Ads
Due to their similarity to Facebook ads, Instagram ads are confusing to many marketers.
How is Instagram advertising different from Facebook advertising? What campaign objectives are available on Instagram? Where can businesses place their ads on the platform?
Read on to get detailed answers to these questions and learn how to make the most of the Instagram advertising options:
How to Build an Effective Facebook Advertising…
Starting a Facebook advertising campaign without any kind of strategy or planning, dooms it to fail before it has even begun.