Global Facebook Advertising Benchmark Report Q4 2014 Advertising Automation Software nanigans.com
About Nanigans Nanigans develops world-class multichannel advertising automation software that enables performance marketing teams to take control of their digital advertising in-house. Since 2010, Nanigans has been chosen by the world s largest ecommerce, gaming, and other internet companies such as ebay, Wayfair, and Wooga. Offered through a SaaS model, Nanigans software features sophisticated tools for cross-channel ROI, predictive optimization, real-time business intelligence, endto-end workflow automation, and unified data activation. About This Report This report is representative of Facebook ad impressions delivered by customers leveraging Nanigans advertising automation software. It includes ad spend on both Facebook desktop and Facebook mobile, and excludes Facebook Exchange. The vast majority of Nanigans customers are direct response advertisers at ecommerce, gaming, and other internet companies. Many leverage Nanigans ROI-based bidding algorithms, which focus on reaching high value and high ROI audiences (e.g. those who make purchases) and typically cost more to reach. As such, the data in this report should not be used as a proxy for the overall Facebook marketplace. The data in this report should not be compared to any prior or future benchmark reports due to variations in the dynamic nature of the data set each new quarter. 2
Facebook ads deliver strong Q4 2014 performance during a competitive holiday advertising season This report highlights key trends seen by companies leveraging Nanigans advertising automation software to manage, optimize, and scale their performance marketing campaigns on Facebook. Key Takeaways Unpublished Page Post Ads, Mobile App Install Ads, and Domain Ads dominated Facebook ad spend by Nanigans customers. Engagement with Facebook ads continued to rise, with global CTRs increasing 197% yearover-year. Composition of Spend by Ad Type Nanigans customers, which primarily focus on direct response marketing, continued to dedicate the majority of budgets to Unpublished Page Post Ads, Mobile App Install Ads, and Domain Ads. These three performance-based ad categories combined accounted for 96% of the total spend that advertisers optimized through Nanigans software in Q4 2014. 100% 80% 60% 40% 20% 0% All Other Ad Types Domain Mobile App Install (All) Unpublished Page Post (All) CPCs increased quarter-over-quarter to $0.64, and rose 37% year-over-year. Effective CPMs increased 48% in Q4 2014 due to higher overall demand for Facebook ads, heightened by holiday spending. Facebook s continued shift to larger, higher performing right hand side ad units decreased the available inventory from Q3 to Q4 2014. Effective CPMs for Domain Ads on the right hand side more than doubled quarter-over-quarter. CPC for Domain Ads While the majority of ad spend fell within Facebook s News Feed, Domain Ads on the right hand side continued to drive lower costs on a per-click basis this year than they did a year ago. Though CPC was up in Q4 2014, Nanigans attributes the increase primarily to high demand during the holidays. Domain Ads are expected to remain a strong value in Q1 2015. 3
CTR Click-through rate CTRs for Facebook ads continued their upward climb in Q4 2014, an indication that both desktop and mobile ad products are driving more engagement among advertisers leveraging Nanigans software. Average CTRs in Q4 were 0.69%, up 22% from Q3 2014 and up 197% from Q4 2013. For Nanigans ecommerce customers advertising on Facebook, CTRs rose 332% year-over-year and 18% quarter-overquarter, signaling active engagement during the competitive holiday season. Desktop and mobile game advertisers saw a slight quarter-over-quarter decrease of 6% in Q4 CTRs, which averaged 0.72%. A longer-term view, however, shows strong growth, with gaming industry CTRs up 126% from the previous year. CTR - Global 0.69% 0.23% CTR - Ecommerce 0.78% 0.18% CTR - Gaming 0.72% 0.32% +22% +197% +18% +332% -6% +126% 4
CPC Cost per click CPC - Global $0.64 $0.47 +21% Global costs on a per-click basis for Facebook ads increased 21% in Q4 2014 to an average of $0.64 among advertisers leveraging Nanigans software, primarily due to heightened demand for Facebook ad inventory. Compared to Q4 2013, CPCs were up 37%. In the highly competitive holiday quarter, ecommerce companies saw average CPCs increase 29% on Facebook. Year-overyear CPC growth stood at 6%, up from $0.60 in Q4 2013. Gaming advertisers experienced marketplace CPCs averaging $0.72 in Q4 2014, which was up 31% from the previous quarter. Year-over-year CPC growth was 126%. CPC - Ecommerce $0.63 $0.60 +37% +29% +6% CPC - Gaming $0.35 $0.72 +31% +126% 5
CPM Cost per 1,000 impressions CPM - Global $4.40 +48% CPMs on Facebook desktop and mobile ads combined increased 48% from Q3 2014 to an average of $4.40 during the holiday quarter. Compared to the 2013 holiday season, CPMs increased 307% among Nanigans customers advertising on Facebook. Ecommerce advertisers saw CPMs rise 52% in Q4 2014, averaging $4.93. Yearover-year growth represented a 360% increase from Q4 2013. For gaming companies, CPMs also rose this quarter, increasing 24% to $5.16. Compared to Q4 2013, CPMs were up 368%. Nanigans attributes the global increase in effective CPMs to two main factors: 1 2 Demand for all Facebook ad types continued to rise, and heightened holiday spending caused perimpression costs to increase. Facebook s improvements to larger, higher performing right hand side ad units decreased the available inventory from Q3 to Q4 2014. Effective CPMs for Domain Ads on the right hand side more than doubled quarter-over-quarter. $1.08 CPM - Ecommerce $4.93 $1.07 CPM - Gaming $5.16 $1.10 +307% +52% +360% +24% +368% 6
Nanigans multichannel advertising automation software powers the world s most successful in-house performance marketing teams. A leading Facebook Strategic Preferred Marketing Developer (spmd), Nanigans is chosen by today s top ecommerce, gaming, and other internet companies such as ebay, Wayfair, and Wooga. Contact Us 2015, Nanigans. All Rights Reserved. Facebook is a registered trademark of Facebook Inc.