Data collected on a sample of 2.8bn impressions by TBG Digital revealed that Facebook’s algorithm charges a 29% lower cost per click (CPC) for ads that keep traffic within the site, by directing users to a brand’s Facebook page, for example.
TBG said there are almost 140 factors that Facebook has set to determine the price for an ad, but its data shows that whether you keep traffic within the site is a key factor.
“A big part of the algorithm is whether you send traffic on or off Facebook, because it wants to keep people on the site,” said Simon Mansell, CEO of TBG Digital. “What it wants is for brands to create campaigns that are ’social by design’, rather than an afterthought, and it will reward them for that.”
Last month TBG also carried out research to determine whether the Sponsored Stories ad format, which Facebook launched in January, was any more effective than normal ads. It found that Sponsored Stories ads that had a social context gained a 46% higher click-through rate.
“Facebook is obviously trying to make more money by encouraging these social ads with better rates, but it’s also beneficial to be more social because you’ll get a better click-through rate,” said Mansell.
Facebook has had a longstanding partnership with research company Nielsen to find out how effective its campaigns have been. According to the social network, people are 68% more likely to remember seeing the ad and twice as likely to remember its message if it includes social context.
Digital agency Essense also runs ads on Facebook and said it had noticed that social ads tended to get around a 10% lower cost per click than standard ads for its clients.
It also said social ads get a strong click-through rate and that since the introduction of Sponsored Stories they had seen stronger performance.
Matt Isaacs, CEO of Essence, said the fact that ads using social data and information perform better means it’s even more important for brands to maintain and build on an initial Facebook community.
“With Sponsored Stories performing particularly strongly, it has highlighted the importance of having an initial fanbase to work from when using social ads,” he said. “The higher the initial fanbase, the more people you can reach with a more personal Sponsored Story ad, achieving higher click-through rates and lower costs per click.”
Domino’s Pizza is using Facebook via social media agency 247 Social, part of Arena Media, to drive people to its Facebook page as well as its own site. Claire Nash, digital media executive at Domino’s, said, “Facebook ad formats offer us a platform to drive brand engagement and direct response, in addition to our core use of fan acquisition. We’re beginning to treat it as its own channel, since it calls on display and search planners. Our commitments have increased as we evolve our strategy and understand the growing importance of social platforms.”
Samsung has also used social ads to promote its tablet computer the Galaxy Tab, via social media agency Jam and media agency Starcom.
Hannah Craik, account director at Jam, said many social media agencies, if not also buying media themselves, had to understand how paid media fits into the campaign by working closely with clients’ media agency.
“Due to the sheer volume of content being shared, even if an idea is really good and strikes a chord, it’s hard to get people to find it,” she said. “You can’t assume things will go viral. It’s not always a first thought for a brand, but Samsung is very good at recognising that it needs to show people where it is. Off the back of the paid activity, the more we do, the more it impacts organic growth.”
This story first appeared on New Media Age. For more digital stories and analysis’ from NMA click here now