CPM v. CPC Bidding on Facebook

One of the most asked questions about Facebook marketing is, “should I use CPC or CPM bid type when running ads?”

The answer is simple when put in the context of the two scenarios below.

Imagine you own a hot dog stand, and you are setup outside a high foot traffic area right at lunch time.

On the other side, imagine you own a high end handbag store.

If you own the hot dog stand and it’s lunch time, your goal is to have as many people as possible come by your stand.

You probably want to pay for impressions (CPM).

Not everyone will buy, but that doesn’t matter. You know it’s lunch time and you want people walking by the amazing smell of beef and brats. Your goal is to reach the masses.

Even though not everyone will want a hot dog, you want your product in front of as many people as possible.

Now what if you own the high end handbag store?

Your purses cost $1500 minimum.

Do you want to pay for every person who walks by your store?

Absolutely not…

You only want to pay when someone somewhat targeted to buy your product walks into the store (CPC or cost-per-click).

If you pay for impressions (CPM), you are gonna spend a boatload of cash on unqualified people.

So in short:

If you want everyone exposed to your offer, use CPM.

If you only want certain people exposed to your offer, use CPC.

 

About The Author

Jeremy Salem is the President of SmartStep Media LLC, a digital marketing agency. He is also an author, product creator and consultant at Digital Traffic Ace.