Facebook changes their definition of CPC

Just two weeks ago on July 8, Facebook announced that it has changed how it defines costper-click (CPC). The new definition states that advertisers bidding on a CPC basis will only pay for “link clicks” (“valued click” engagements) based on campaign objectives.

Advertisers will no longer pay for all click types, including but not limited to likes, shares, and clicks that enlarged images regardless of campaign goal. With this change, advertisers will only be billed for specific link clicks that drive campaign objectives. This includes clicks on call-to-action buttons that link offsite like “Shop Now”, clicks to install an app, clicks to Facebook canvas apps and clicks on a link to view a video on another website. Over the past few years, Facebook has continued to evolve its bidding algorithms to help advertisers meet specific business goals. When Facebook launched oCPM (optimized CPM) bidding, the Facebook algorithm delivered more accurate performance by optimizing for desired outcomes. This latest update is designed to provide stronger measurement that more closely aligns with bidding strategies. The main differentiator between the oCPM bidding and the newest CPC model is that now advertisers pay per link click, not per thousands of impressions.

https://www.facebook.com/business/news/updating-cpc-on-facebook

How This Impacts Marketers

Once this change goes into effect, advertisers who care about link clicks are likely to see better return on advertising spend, since they’ll be paying for only the most valuable outcome. Separating link clicks from engagement clicks (including likes and comments) means your budget will be spent more efficiently no matter if you bid for clicks or engagement. As a result of this change, some campaign reporting metrics related to clicks may look different. By excluding likes, shares and comments, CPC may increase but will also become more valuable as it counts only the clicks you want. Similarly, it may look like your click-through rate (CTR) has decreased; again, this is because the CTR will no longer factor in the additional clicks.

What To Do Now

In the coming weeks, this change will take effect any Ads Manager/Ad platform. If you are part of any ad platform development that deals with Facebook Ads, you should begin testing this new method for clients who bid towards “link clicks” to gauge the effectiveness of oCPM vs. CPC. For clients who are already bidding CPC, our QA team should pay special attention to any fluctuations in metrics and optimize accordingly.

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