CPC or CPM? Which is better for your Facebook Ad?

An often confusing part of the ad creation process in Facebook is the campaign price and scheduling section where one is required to state their ad budget and then choose between a CPC (cost per click) or a CPM (cost per mille)bid. What’s the difference between those two terms and which is the best one for your local business ad?

Defining CPC and CPM

First let’s start by defining those two terms. Cost per click or CPC means you only pay when people click on your ad, even if it is viewed by millions of people. Cost per mille (thousand views) or CPM means you pay a certain figure for every one thousand times your ad is viewed.

Which one works best?

So which is the better option? Well it all depends on what you are trying to achieve. CPC works best when you have a limited budget and only want to pay for when people take action to click on your ad. CPC is therefore more result-oriented and is effective for sales campaigns CPM on the other hand works well for public relations and awareness campaigns where your business goal is to spread the word about your business on a large scale. You can therefore choose CPM for social causes, advertising a fan page, publicizing a launch or event. However CPC could be a disadvantage if your ad doesn’t get a high click through rate because Facebook will then display your ad less and less and you might not have a successful campaign as a result. On the other hand Facebook doesn’t penalize CPM campaigns even if they have a low click through rate.

The Verdict

Therefore the best strategy is to use a combination of CPC and CPM. You could test different ads using CPC first and see which one has the highest click through rate and then switch it later to CPM. The key is to test different ads and see what works best for your local business ad.


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