Martech: Martech is Marketing Logo
  • Topics
    Digital Transformation
    Marketing Operations
    Data
    Customer & Digital Experience
    Performance Marketing
    Marketing Management
    Special Reports
    MarTech Topics
  • Conference
  • Webinars
  • Intelligence Reports
  • White Papers
  • What is MarTech
    Mission
    Staff
    Newsletter
    Search Engine Land
    Third Door Media

Processing...Please wait.

MarTech » Performance Marketing » E-commerce brands boost Facebook ad spend as CPMs, CPCs rise but CTRs dip

E-commerce brands boost Facebook ad spend as CPMs, CPCs rise but CTRs dip

In Q3 2017, online retailers increased the amount of money they poured into Facebook’s mobile video ads and shopper-retargeting Dynamic Ads.

Tim Peterson on October 31, 2017 at 2:54 pm

If the third quarter is a warmup exercise for e-commerce advertisers plotting their fourth-quarter spending spree, then it should be a happy holiday season for Facebook.

E-commerce advertisers, on average, spent 20 percent more money on Facebook ads in the third quarter of 2017 than they did in the same period last year, according to a report published on Tuesday by Nanigans, a company that provides software for brands to automate their Facebook ad buys and that is a part of Facebook’s Marketing Developers program. A Nanigans spokesperson declined to say how many advertisers were included in the study.

While e-commerce brands are pushing more money into the social network in general, they are particularly purchasing more mobile video ads and retargeted ads from Facebook. These marketers spent, on average, 40 percent more money on Facebook’s mobile video ads in Q3 2017 than in Q3 2016. And the share of their ad spend that went to Facebook’s Dynamic Ads — its product catalog-promoting ad format that retargets the people who browsed a brand’s site or app — increased by 284 percent year over year.

While the share of e-commerce brands’ budgets going to Dynamic Ads grew, it’s unclear how big (or small) a piece of those budgets the ad format accounts for. The Nanigans spokesperson declined to say what was the actual share of e-commerce brands’ budgets spent on Dynamic Ads.

Interestingly, e-commerce advertisers increased their spending on Facebook despite an increase in the social network’s ad rates and a decrease in its ads’ performance for these brands.

E-commerce advertisers typically paid $8.40 for every thousand times their ads were served across Facebook and its Audience Network ad network of third-party sites and apps (Nanigans’ study did not include Instagram campaigns). That’s a 69 percent higher CPM than e-commerce brands paid a year ago and corresponds with a 57 percent year-over-year increase among all advertisers to $9.31.

While e-commerce brands paid a premium for impressions, clicks were significantly cheaper at $0.46 on average. That CPC has similarly swelled over the past year, but e-commerce brands also pay less money per click than the average Facebook advertiser that paid $0.55 per click in Q3 2017, a 54 percent increase year over year.

At the same time Facebook’s ad rates have risen, its ads’ performance has dipped. In Q3 2017, people clicked on e-commerce brands’ Facebook ads about 1.84 percent of the time, down 4 percent compared to a year ago. However, that’s still a better click-through rate than the average advertiser saw on Facebook. In Q3, Facebook’s worldwide click-through rate averaged 1.69 percent, up 2 percent compared to a year ago but down 4 percent compared to the previous quarter. That marked the first time Facebook’s average global click-through rate declined from Q2 to Q3, according to Nanigans, though the company’s spokesperson said that shift “is unlikely to be indicative of a larger directional change in the market.”


Opinions expressed in this article are those of the guest author and not necessarily MarTech. Staff authors are listed here.


New on MarTech

    How clean, organized and actionable is your data?
    Replacement Survey: The top 5 solutions replaced
    What’s the biggest hidden secret in Google Ads?
    Native video tops social media in brand awareness study
    Worsening economy has more shoppers getting online info before making in-store purchases

About The Author

Tim Peterson
Tim Peterson, Third Door Media's Social Media Reporter, has been covering the digital marketing industry since 2011. He has reported for Advertising Age, Adweek and Direct Marketing News. A born-and-raised Angeleno who graduated from New York University, he currently lives in Los Angeles. He has broken stories on Snapchat's ad plans, Hulu founding CEO Jason Kilar's attempt to take on YouTube and the assemblage of Amazon's ad-tech stack; analyzed YouTube's programming strategy, Facebook's ad-tech ambitions and ad blocking's rise; and documented digital video's biggest annual event VidCon, BuzzFeed's branded video production process and Snapchat Discover's ad load six months after launch. He has also developed tools to monitor brands' early adoption of live-streaming apps, compare Yahoo's and Google's search designs and examine the NFL's YouTube and Facebook video strategies.

Related Topics

Performance Marketing

Get the daily newsletter digital marketers rely on.

Processing...Please wait.

See terms.

ATTEND OUR EVENTS The MarTech Conference logo.

September 28-29, 2022: Fall

Start Training Now: Master Classes

Start Discovering Now: Spring



The SMX Conference logo.

Start Training Now:: SMX Advanced

November 14-15, 2022: SMX Next

March 8-9, 2022: Master Classes

Webinars

Agencies: Grow Revenue Streams Through Web Accessibility & Compliance

Protect Your Paid Advertising Spend Against Ad Fraud and Invalid Traffic

Build an Integrated Search Strategy Across Google, Amazon and YouTube

See More Webinars
Intelligence Reports

Enterprise SEO Platforms: A Marketer’s Guide

Enterprise Identity Resolution Platforms

Email Marketing Platforms: A Marketer’s Guide

See More Intelligence Reports
Featured White Paper

Site Search 101

See More Whitepapers

Receive daily marketing news & analysis.

Processing...Please wait.

Topics

  • Transformation
  • Operations
  • Data
  • Experience
  • Performance
  • Management
  • All Topics
  • Home

Our Events

  • MarTech
  • Search Marketing Expo - SMX

About

  • What is MarTech
  • Contact
  • Privacy
  • Terms Of Use
  • Marketing Opportunities
  • Staff

Follow Us

  • Facebook
  • Twitter
  • LinkedIn
  • Newsletters
  • RSS

© 2022 Third Door Media, Inc. All rights reserved.