How much do Facebook ads cost?

Love it or hate it, Facebook plays an integral part in marketing your business online. But how much will advertising on the Meta platform set you back? Find out all about the costs and the factors that affect them here.

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Calculating the costs of advertising on Facebook isn’t easy, as the amount varies quite substantially depending on several factors. These include the competitiveness of your industry, your ad campaign objectives, and most importantly, the bidding model you use.

On average, based on the median of industry advertising costs across Facebook, and figures from AdEspresso’s 2021 ad report, you will be spending:

  • £0.76 – £1.06 per click on a CPC (cost per click) bidding model
  • £10.77 per thousand on a CPM (cost per impression) bidding model
  • £4.47 per action on a CPA (cost per action) bidding model

These figures aren’t set in stone, and Facebook advertising is a confusing beast to tame at even the best of times.

To make life easier (and cheaper) for yourself and your business, we would recommend using a professional digital marketing agency to manage your Facebook advertising for you.

Getting support for your business is cheaper than you might think. So, if you would like to find out exactly how much hiring a digital marketing agency would cost you, simply fill out a few details using our social media support quote comparison tool.

It is easy to use, and there are zero obligations on your part — oh, and it’s 100% free!

Or read on to learn more about how much Facebook ads cost in the UK.

How Facebook ads work

Facebook limits the number of advertisements that each user sees, as it doesn’t want the user experience to be negatively impacted by a swarm of ads clogging up their feed.

This results in limited availability of ad space, but high demand from businesses that want to promote their products and services on the platform.

In order to gain an ad placement, businesses must enter into an auction and bid against each other. This often results in a bidding war, with the highest bidder getting to display their ad.

However, when Facebook selects the highest bidder, they don’t do so in the traditional monetary sense. Instead, Facebook determines the winning ad by analysing three factors:

  1. Advertiser bid – this is the monetary value attributed to the ad, and shows Facebook how invested you are in securing the placement
  2. Estimated action rates – the likelihood that a person will take the action you are optimising for with your ad (for example signing up to a newsletter or subscribing to a service)
  3. Ad quality and relevance – higher quality, targeted ads are more likely to be chosen by Facebook because users will be more interested

It is important to understand the costs of advertising on Facebook before you decide on your ad strategy. The cost of each bidding model can fluctuate depending on competition, demand, and the time you choose to advertise.

There are several different bidding strategies you can adopt when you enter into auctions, Facebook summarises these perfectly in its business help centre.


Breakdown of Facebook ad costs in the UK

Facebook ad costs can be broken down into three primary categories, which are otherwise known as bidding models.

Bidding models are either cost per click (CPC), cost per mille (CPM) otherwise known as cost per thousand impressions, or cost per action (CPA).

What exactly is a bidding model?

Companies bid against each other in auctions for ads on social media platforms like Facebook. The maximum amount of money a business is willing to pay for an ad will be determined by whether it's after ad clicks, impressions, or actions. This is known as a ‘bidding model’.

The cost of ads on a CPC model

Cost per click refers to the price you pay per click on one of your ads. This model is traditionally used on Facebook, but is now more widely implemented on Instagram.

To find out how, visit our definitive guide on how to use Instagram for business.

Cost per click ads differ in price depending on the industry your business operates in. This is because the more competitive the industry, the higher your rivals are going to bid at an ad placement auction, pushing up the final cost.

Facebook does allow you to set up budgets, so you don’t have to go over the overall amount of money you’re willing to pay for a campaign or single ad set.

On average, a CPC ad will cost you around £0.76 – £1.06 per click. But in more competitive industries like finance, this can rise to up to £3.07 per click.

The cost of ads on a CPM model

CPM stands for cost per mille or cost per thousand impressions (CPT). It is the price you pay to Facebook every thousand impressions, which currently stands at an average of £10.77.

It is a great benchmark to start with when you begin advertising on Facebook.

What is an impression?

An impression is a digital marketing term that refers to when your ad is seen by a user on social media. The user does not need to click on the ad or engage with it (like/comment) in order to count as an impression.

Using a CPM model is incredibly handy when measuring the performance of a Facebook advertising campaign. This is because once you have an idea of the CPM, you can estimate the click-through rate.

The click-through rate represents the number of people who see your ad and take action, whether that be by clicking on it, ‘liking' it, or commenting on it.

From analysing these figures, you can work out how much a CPC ad campaign could cost you, which is incredibly useful when planning future digital marketing campaigns.

On average, a CPM ad will cost you around £10.77 per thousand impressions on average.

The costs of a CPA model

CPA stands for cost per action or acquisition. It is the price you pay for the action a user takes on your website as a result of your Facebook ad.

This can be through the form of a conversion, in which you will pay Facebook for an advertisement that makes a sale. Or via other actions – including newsletter sign-ups and app downloads.

Although cost per action bidding can be expensive on Facebook, the rewards are higher than with CPC and CPM.

This is because user intent is much higher, and for the most part you are paying for actual conversions, which is bringing in revenue to your business. Rather than clicks or views, which have a much lower user intent.

How is CPA calculated?

The average cost per action is calculated by dividing the total cost of conversions by the total number of conversions.
For example, if your ad receives 4 conversions, each one costing £5, your average CPA for those conversions is £5.

We hope the above is helpful, but through our vast experience of working in the digital marketing sector, we’d say that understanding Facebook bidding models and making sense of how they function might not be the most beneficial way to spend your time as a small business owner.

By hiring a digital marketing agency to help support your Facebook ad campaign strategy, you can be confident that a team of experts will ensure your brand will reach the right audience — and it could save you literally hours of time each week.

If you are looking to work with an agency, simply answer the question below to start the one-minute process of receiving free, no-obligation pricing information.

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What factors affect Facebook ad costs?

  • Target audience – when advertising in a saturated market, you will have more competitors competing for ad placement. The more competitors there are bidding at an ad auction, the higher the bidding will go, which will increase advertisement costs
  • Timing – because Facebook ads are auctioned, the time of the year will greatly impact how expensive advertising on the platform is. For example, during Christmas and Black Friday more businesses will be buying ads, which will push up the prices and increase the competition. The same can be said for the time of the day – peak times are during the day, dropping off between midnight to 6am
  • Your bid – Facebook determines which ads to show on the basis of three criteria, one of which is the amount you bid. The higher your bid, the more likely you are to win the auction against your competitors
  • Ad quality and relevance – Facebook will reward your business if it produces high quality, targeted ads by charging you less to reach a wider target audience. Make sure your marketing team works hard on your ad campaigns to ensure that you 1) win bids based on quality and 2) pay less as a result
  • Your campaign objective – selecting the right campaign objective is a sure-fire way to control Facebook ad costs. Make sure you are fully aware of what your marketing campaign is trying to achieve, as choosing the wrong objective for your ads can result in you being caught out by Facebook’s bid system – paying up to 164% more for CPC ads in some cases. Campaign objectives include brand awareness, video views, and conversions

There are other factors that affect Facebook advertising costs, including estimated action rates and the placement of your ad. This can all be difficult to grasp, which is why it can be incredibly beneficial for your return on investment (ROI) to work alongside a dedicated digital marketing agency.

Want to learn more? Check out our review of the top 8 digital marketing agencies in the UK.


How to set up a Facebook ad

Facebook ads are a form of paid social media – so unlike organic social content, you'll have to pay for an ad placement by entering into an auction.

Setting up an ad isn’t the simplest process, and there are factors that need to be accounted for before your ad can go live.

For example, in order to have a higher chance of your advertisement bid being accepted by Facebook, you’ll need to be sure you choose the right target audience.

You’ll be penalised by Facebook if your ad is deemed irrelevant, which means you’ll have to pay through the nose to win an ad placement.

Every advertisement that you set up on Facebook will be done via its Ad Manager application. The Ad Manager is a sophisticated dashboard that gives you an overview of all your marketing campaigns, including the ones on Instagram.

Simply log into your Facebook business account, and navigate to the Ads Manager. From here, you can produce a Facebook ad from scratch by selecting the ‘Create Ad’ button, which will ask you to set the parameters of your campaign.

 

fb ad manager

The next steps to setting up your Facebook ad are as follows:

  1. Choose an objective – with 11 different objectives to choose from, think carefully about the aims of the ad/campaign. The list of objectives includes everything from reach to lead generation.
  2. Choose your audience – if you are new to Facebook advertising, it is likely you’ll have to try out several different targeting options until you reach the right audience. Take advantage of Facebook’s great targeting features – including its custom and lookalike audience tools
  3. Arrange your ad budget – you can either set a daily budget or a lifetime budget. If you want the ad to run continuously, we recommend choosing the daily option
  4. Schedule your ad – customise start and end dates and even specify what hours in the day and days of the week you want your ad to run
  5. Create your ad – decide whether you want a link or carousel advertisement placement, and then upload your creative assets

Once you’ve completed the setup of your campaign, you can submit your ad for review, and monitor its performance metrics using Ad Manager.

Is your business based in London?

There are hundreds of brilliant digital marketing agencies in the UK's capital. To find out our top picks visit our review of the top digital marketing agencies in London.

Why Facebook advertising is worth the cost

There are countless reasons why your business should be using Facebook to market your brand. We've summarised a few:

Scale

With 2.91 billion monthly users, Facebook is the third most visited site in the world behind Google and YouTube. It’s a huge opportunity to market your brand to new and existing customers, and you’d be ignorant not to take advantage of its size, and reach.

Advanced targeting

With so many users, it is essential that you target the right audience in order to have a successful marketing campaign. If you cast your net too wide, you’ll catch lots of users that aren’t interested in your product or service.

Be prescriptive and customise your target audience by changing options such as location, age, and even interests, to reach the right audience. You can even send specific ads to customers at different stages of the marketing funnel.

In depth analytics

Facebook provides in depth reporting and insight in Ad Manager, so you can measure metrics like post engagement and conversion rates to refine your ads, plan for future marketing campaigns, and boost that all-important return on ad spend (ROAS).

Custom and lookalike audiences

One of Facebook’s unique benefits to help you grow is its custom and lookalike targeting tools. Custom audiences let you target ads to people who already know about your business, whilst lookalike audiences are a tool that helps you find new customers that are very similar to your existing ones.

Higher engagement

We are sorry to say that, organic reach is declining. Changes in Facebook’s algorithm back in 2021 have resulted in the average organic Facebook post seeing just 0.07% engagement. Boosting and advertising your posts is vital to get your brand seen and heard.


Facebook ad costs vs. Instagram ad costs

0 out of 0
Platform
CPC Cost (Average)
CPM Cost (Average)
Number of monthly active users (2022)

Instagram

Facebook

£0.80 – £1.10 per click

£0.76 – £1.06 per click

£7.94 per thousand

£10.77 per thousand

2 billion

2.91 billion

To find out more about Instagram ad costs, visit our dedicated guide.

It’s important to compare the advertising costs of these social media platforms, especially considering they are the two biggest available (followed closely by TikTok). Despite the fact you can advertise on Instagram using Facebook's Ad Manager, the costs do vary.

The average CPC cost is currently very similar, however the CPM is much higher on Facebook than it is on Instagram. So, actioning a CPM campaign on Instagram rather than Facebook could help keep marketing overheads down.

To market successfully on both platforms, and ensure you aren’t spending valuable time and money on dead-end campaigns, you should always research the latest digital marketing trends.


Next steps: should I get support setting up my Facebook ad strategy?

To recap on the average amount it would cost you to run a Facebook ad campaign:

  • For CPC you will be paying round £0.76 – £1.06 per click.
  • For CPM you will be paying round £10.77 per thousand impressions.
  • For CPA you will be paying round £4.47 per action*

*CPA amount varies on a day-to-day basis and the average is calculated by dividing the total cost of conversions by the total number of conversions.

Facebook ads are the perfect way to promote your business and your brand, especially if you are a new merchant.

You have the largest pool of users to advertise to compared to any other social media platform, and the Ad Manager has everything you need to organise your bidding model, set up your marketing campaign, and track its performance.

However, Facebook’s sheer scale and the complexities of using the Ad Manager are definite pain points for small business owners, who often spend more time working out how to market on the platform than actually marketing on the platform.

This is why we would highly recommend you hire an expert team of digital marketing professionals that will be able to do the hard work for you, so you can sit back, relax, and watch those conversions come flooding in…

To find out more about some of the best digital marketing agencies in the UK and to receive bespoke, personalised quotes for their Facebook support services, simply fill out our free, easy-to-use comparison tool.

There are zero obligations on your part, and the form takes under a minute to complete. So what are you waiting for?

Ross has been writing for Startups since 2021, specialising in telephone systems, digital marketing, payroll, and sustainable business. He also runs the successful entrepreneur section of the website.

Having graduated with a Masters in Journalism, Ross went on to write for Condé Nast Traveller and the NME, before moving in to the world of business journalism.

Ross has been involved in startups from a young age, and has a keen eye for exciting, innovative new businesses. Follow him on his Twitter - @startupsross for helpful business tips.

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