Facebook CPMs Climb Despite Falling Clicks

Click-through rates on Facebook are going down even as the cost of advertising on the dominant social network continues to rise. Average CPM rates for non-premium display ads on Facebook in the first quarter are up 41% from a year ago, and up 15% from the fourth quarter of 2011. At the same time, click-through rates dropped 8% from the prior quarter.

The new findings from social media marketing firm TBG Digital are based on an analysis of 268 billion Marketplace ad impressions served on Facebook across five major markets: the U.S., U.K., France, Germany and Canada. (The firm did not disclose the actual value of ad rates.) Cost-per-click rates on Facebook rose even faster than CPMs, increasing 25% over the last quarter.

Underscoring that point, WPP CEO Martin Sorrell  that client spending on Facebook advertising would double to about $400 million this year.

A separate forecast by Brian Wieser of Pivotal Research Group released last week takes a more measured view, estimating that Facebook’s ad revenue will increase about 30% overall in 2012 from $3.1 billion last year.

Still, how does TBG explain ad rates continuing to climb on Facebook while click rates slip?

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What where the top strategic priorities for social media marketing in 2011

A study recently released by Marketing Sherpa polling CMOs (Chief Marketing officers) reveals the top strategic priorities for social media marketing in 2011

  • Recruiting interdepartmental staff to perform social marketing activities 8%
  • Improving the quality and cost efficiency of customer support programs 9%
  • Integrating social media monitoring and analytics into a single dashboard 11%
  • Integrating social marketing data with CRM and other marketing systems 21%
  • Achieving or increasing measureable lead generation from social marketing 43%
  • Achieving or increasing measureable ROI from social marketing programs 46%
  • Improving search engine ranking positions 50%
  • Developing an effective and methodical social marketing strategy 53%
  • Converting social media members, followers, etc.into paying customers 63%
  • Improving brand awareness or reputation 66%
  • Increasing website traffic through social media integration 71%