Is it more expensive to advertise on social media?

The more popular something is, the more people talk about it—and the more people talk, the more inaccuracies tend to abound.

Right? There are celebrities, politicians, social issues—and social media.

Which is a little funny, if you think about it, because social media itself is where a lot of people do all their talking about these popular things, in the first place.

And it’s because people are on social media a lot of the time, that social media is a fantastic place for reaching out to people, and telling them what you can do for them. Whether you’re a medical practice, a higher education institution, or any kind of business, social media is a great place for ads.

But aren’t ads on social media more expensive than other forms of digital marketing?

Well, if you’ve ever heard anyone say this, remember what we just said about inaccuracies?

As a 360 digital marketing agency, we know quite a bit about social media ads as well as other digital marketing media, so we’re here to tell you, “it ain’t necessarily so”.

In this round of 360° Views, we’ll take a look at the cost of display ads, search engine marketing, content marketing, email marketing and SEO, as well as the cost of social media ads, so you can see for yourself.

How much does it cost to perform other forms of digital marketing?

Display Ads

It can cost about $0.58 every time someone clicks on a display ad, or an ad you show on any website belonging to Google’s Display Network. But how much you actually end up spending on display ads—and whether that amount is a “good” (i.e. cost-efficient) amount—depends on factors such as

The kind of business you have or industry you’re in
Where you are in the world
What’s going on on the world (say, a pandemic)
Your customers’ buyer’s journey

And, whether or not what you spend is worth it (i.e. ROI) is another matter entirely, as the probability of anybody actually clicking on a display ad isn’t all that high.

Search Engine Marketing

What we’re really referring to here are Google Ads, or those ads that come out whenever you search for something on Google, that look like search results but are marked “Ad”.

Some people call them “PPC” ads when “Pay Per Click” is actually the model digital marketing platforms use for charging advertisers. It can cost $2.32 per click for Google Ads, and every time someone converts, or does something you want them to (like download, sign up for, or buy something), the Cost Per Action can be up to $59.18.

Now, again, how much you end up spending on Google Ads depends on the industry you’re in, because your ads will contain keywords, and some keywords are simply more expensive than others, depending on how competitive your industry is. Some of the priciest keywords on both Google and Bing can cost $50 a click.

Content Marketing

This may not involve ads, per se but it is a form of digital marketing and it does come with its own costs. How much you end up spending on content marketing largely depends on the quality of the content, as well as how frequently it’s produced and put out there.

So if you cut corners for someone whose design sensibility is limited to the use of templates or an inexperienced hack without style or grammar, that quality is going to reflect on your brand. And if you put oodles of slipshod work out there every so often, that poor reflection is magnified exponentially.

In any case, as with display ads and search engine marketing, the cost of content marketing will, again, depend on your business goals.

But on average, the cost of writing a blog can fall between $50 to about $1,000 (if you engage a super experienced writer), while an original video can cost about $1,000 to as much as $50,000 (for Hollywood-esque quality).

Email Marketing

Yes, email marketing is still a thing, otherwise, people wouldn’t still be spending on it, and people generally don’t spend on things that don’t work (at least, not knowingly). But when one considers how email marketing can give one as much as $44 back for every dollar one spends, anyone might consider that dollar as very well spent.

Which is a good thing because one might spend a fair bit on email marketing, particularly if one happens to be a small business owner or promoting pretty much anything, and getting someone else to do email marketing for them. Outsourcing email marketing can cost between $15 to $100 an hour.

And that’s if you just send out plain ol’ emails. Getting a designer to do up a lovely email template or create images to go with your emails can also come with an hourly rate of something like $25 to $150. But even if you do choose to do your own email marketing, it can still cost you from $9 to $1,000 a month.

SEO

This undisputed heavyweight champion of the digital marketing world is often seen as the “free” counterpart of search engine marketing, but that’s likely due to the fact that these search engine results don’t come with an “Ad” attached to them.

If you check out our 360° Views on SEO vs PPC, as well as our side-by-side comparison of SEO and Paid Search, you’ll see that SEO is anything but free. There’s a lot that goes into the cost of making sure your business’ website is the first to be found when potential customers come looking, which includes the cost of engaging the services of

An on-page, off-page and technical SEO specialist
A writer, designer and web developer

Your website’s current ranking, your desired ranking, and how quickly you want to achieve your desired ranking, also have a hand in affecting the final cost of your SEO. That final cost can range between $1,000 to $5,000 per month depending on the size of your business, and your business goals.

So how much does it cost to advertise on social media?

The average social media ad budget is between $200 to $350 per day, which means you could spend about $6,000 to $10,500 a month. The cost of Facebook ads, in particular, are also measured in terms of cost of per click like display ads, with the average CPC coming in at $1.72—again, that depends on the industry you’re in.

And just like other digital marketing channels, there’s a lot that goes into the cost of advertising on social media whether you choose to do it yourself or engage the services of an agency.

On top of the cost of content creation (see our section on content marketing above), there are schedulers like Hootsuite and Later and related services like Hashtagify or Buzzsumo you might choose to pay for.

But the costs we’ve mentioned above are averages, and averages don’t account for businesses and their individual advertising budgets. And you should know that, depending on your business goals (note how we didn’t say “business size”), it is actually possible to run effective social media ads on relatively smaller amounts.

Let us show you how using a typical, basic funnel which covers the Awareness, Consideration and Decision stages of the buyer’s journey. (That is, when someone becomes aware of your business, considers your option alongside your competitors’, and decides to buy from you.)

Facebook (and Instagram)

Awareness Stage. Using the Reach or Brand Awareness Objective (which are two of the 11 objectives you can choose from when you run Facebook ads), you can spend as low as $5 a day per ad campaign.
Consideration Stage. Using the Video View or Engagement Objective (meaning you want people to watch your video or like, share or comment on your post), you can also spend $5 a day per campaign. If you choose the Traffic Objective (meaning you want people to visit a particular webpage), you could spend $10 a day for every ad set. And if you go with the Messages or Lead Generation Objective, you might spend as much as $20 a day per ad set.
Decision Stage. Using the Catalogue Sales or Conversion Objective, you can spend $30 a day on an ad set.

Note that you can also boost a post on both Instagram and Facebook for as low as just one dollar, but this is something we don’t recommend (because it won’t be very effective).

We have some other things for you to note for Facebook ads, as well.

1. $800 for 28 days.

As a Facebook Marketing Partner, our resident Facebook ads gurus talk to Facebook Marketing Experts all the time. In one of those talks, the expert told us that Facebook recommends spending at least $800 over a period of 28 days (so that’s roughly $28.60 a day) if you’re running a Direct Lead Generation Campaign.

2. Match the CPM.

Cost Per Mille, or how much it costs for an ad to come out Facebook 1,000 times, is something you should consider when figuring out how much you’re going to spend on your ads per day. When computing your daily budget, it should at least match or be more than the CPM of the campaign or the ad set.

Example 1: You start an Engagement campaign at $5 a day, but you find that you’re getting a CPM of just $3. That means you can lower your budget to just $3 a day.

Example 2: You run a Lead Generation campaign at $20, but if you find that the CPM went up to $30, it’s advisable to increase the budget to match.

Matching your daily spend to the CPM helps your ads compete in the bidding process, especially if you choose to use Facebook’s automated bidding strategy.

3. Consider the Learning Phase.

Facebook ads come with a learning phase during which Facebook figures out the best people and places to show your ad, and this is something you need to consider when figuring out how much you want to spend on ads.

Note that an ad set needs to achieve a result of 50 in seven days to be able to exit the learning phase—that means 50 conversions, or link clicks, let’s say (it’s up to you to decide).

Example: If our benchmark cost per result is $10, 50 conversions x $10 = $500

That means we’ll need to spend $500 in seven days to exit the learning phase.

Why all this fuss about the learning phase in the first place? Because campaign results are expected to improve once the learning phase for an ad set is over.

The de facto go-to for B2B’s that want to advertise on social media, LinkedIn is also a great place to reach out for other businesses such as a medical practice, a higher education institution, or even automotive.

LinkedIn uses an Objective-based pricing scheme for advertising on its platform, which means how much you spend on LinkedIn depends on what you want people to do when they come across your ad. If you want them to visit your website, for instance, you’ll be charged according to the number of clicks on your landing page.

Costs per click on LinkedIn can come in between $2 and $5, which again can depend on where you are in the world. You can also put in a $2-bid for CPC or CPM for text ad campaigns. Note that LinkedIn always gives you a suggested bid, but you'll need to bid at least 0.5% higher than the bid that LinkedIn suggests.

The relatively higher cost of advertising on LinkedIn has been rationalised by audience and lead quality. LinkedIn ad cost has also been compared to the cost of advertising elsewhere on the web, such as an ad on Google costing $125 per click vs a $7-click on LinkedIn.

You can expect to spend at least $10 per day for every campaign, or a total of $10 per campaign if you’re doing Sponsored Content (which is LinkedIn’s version of “boosting a post” on Facebook).

You can also expect to spend double your Facebook budget on LinkedIn, as the CPM on LinkedIn is almost always twice (and maybe even more) the CPM on Facebook (mainly because of the number of users or potential reach).

But choosing the best way to advertise online isn’t about choosing the cheapest.

It’s about choosing the most effective ways to reach the people who are the most likely to become your patients, your students, your customers or your clients. Choosing one digital marketing channel because it seems to be a bargain might actually end up costing you quite a chunk to get the results you need.

In the end, it’s not so much the channel as the strategy behind its choice, as well as the message you end up sending over it. And how much you end up spending per channel is part and parcel of that strategy.

We say “per channel” and not “on a channel” because a good digital marketing strategy is never reliant on a single channel alone, whether it’s any social media platform, display ads, search engine marketing, SEO or so on.

The fact of the matter is that there is no single perfect channel. Every channel has its strengths which can be played up, and weaknesses which may be compensated for by other digital marketing media.

In figuring out which online advertising outlet is more or less affordable, choosing to put all your ad spend in just one, or even just two, runs a considerable risk of having most or all of your budget flushed away. It’s not too far fetched, after all, for an algorithm change or, say, a pandemic to suddenly derail your digital marketing efforts.

The sensible way to spend your digital marketing dollars, then, is to create a strategy that balances and monitors expenditure on a selection of digital marketing channels that are best suited to meeting your business’ goals.

That way, you can make sure your activities on each channel are supported by the others, and you can adjust your expenditure on each channel as necessary.

In which case, perhaps the more pertinent question to ask, rather than “Is it more expensive to advertise on social media?” would be, “Does my business have a 360 digital marketing strategy?” If you’d like to find out exactly what that is— learn more about our 360 digital marketing engine, now.