Anybody else experience big increase to FB ads conversion cost in last few weeks?

[geek180]

Huge. We had record spend and revenue throughout March – May. June was not as great and now my FB numbers are terrible.

[rawdealbuffy]

There was a post here last week where a few people chimed in about experiencing issues, myself included. So yeah, it’s been rocky to say the least. Yesterday though a few historically top performing campaigns suddenly dropped back down to early-May levels and CPMs have been halved from last week, so hopefully a portents of what’s to come or potentially just the calm before the summer storm.

[iamfanny]

Seeing this in the UK as well, everything has been inexplicably worse since mid June.

Comments here generally agree but probably not a representative sample so no real idea if this an actual issue Facebook’s side or a random selection of advertisers seeing a drastic but not unlikely change in user behaviour.

[redditpaidsocial]

Some things to consider:

​

*There’s been a lot of chat recently around why ad performance as dropped off a cliff for some people and this new sense of optimism that this upcoming big brand boycott is somehow going to help everyone else out with cheaper ads. Hopefully I can address some concerns:*

***Ad Performance:*** *One thing I’ve noticed that seems extremely prevalent with social media ad buyers is that people are stuck in a Facebook bubble and very rarely look outside of ads manager. “Why have my ads fallen off a cliff? is a common question but sometimes there are far bigger things at play than just Facebook trying to “fuck you over”. So here’s the reason why your ads aren’t performing as well as they have been:*

* *As most shops closed when lock downs happened as a result of COVID,* ***all of that demand shifted online****. So with people buying online more, this is naturally going to bring increase performance in your ads as there’s more online demand. That’s why most people saw incredible months in March / April / May.*
* *At the same time of shops closing, everyone was made to work from home or put on to furlough. This naturally means people are going to be spending more time on social media while at home all day.* ***With equates to a big drop CPM rates***
* *Also at the same time, lots of businesses were re-assessing their media budgets, so t****here was also less pressure on the auction***

*All of the above resulted in a killer few months for a lot of people in the eCom / ad buying space.*

* *Now lockdown is ending, shops are opening again. So* ***demand is shifting back towards going into shops*** *(where possible)*
* *People are going back to work gradually, so now there’s less media space available* ***which will drive up CPM rates***
* *Businesses are starting to feel more confident in spending again, which means* ***more pressure on the auction.***

***Why It Won’t Get Much Better?*** *It’s been a bit of a perfect storm for ad buyers now and things won’t be getting much better because:*

* *We’re looking at a global recession for at least a year. While some people see this as an opportunity, it’s definitely a slow burn especially when people are losing their jobs and market confidence is no where to be seen. It’s difficult to say what’s going to happen, but the UK saw a 20% drop in GDP in April which is absolutely HUGE.*
* *For US ad buyers, there’s an election coming in November and the auction is going to get filled up with political ads. With the amount of money these lot will be spending, I can see this having a huge effect on CPM rates, Luckily the election is just before the lead up to Black Friday* *?*
* *There’s a lot been said about this Brand Boycott of Facebook for July.will lead to “wild” decreases in CPM rates. It won’t. Big brands like Unilever and Honda are very different to eCom businesses*
* *Most are still heavily invested in traditional marketing like TV and OOH. Having worked on brands like this, not even 5-7.5% of their yearly budget will be invested in Social (obviously brand dependent)*
* *Big brands will be far more tactical with their spend on social i.e. they’ll have big spikes in activity to back up above the line TV campaigns, as opposed to a social-led campaign. Take Hellman’s Mayonnaise owned by Unllever, there’s no need for them to have an always on social strategy, they’ll just use social to compliment other marketing channels. THis has never affected CPM rates before, so it won’t when they don’t run it.*

***What You Can Do?*** *While a recession is no good to anyone, there’s lots you can do to help your businesses*

* *Get your head out of ads manager and start to understand the economic climate. This couldn’t be more important now. Instead of blaming Facebook and looking for the answers to your ad performance just in the channel, look at what’s going on in the world and look how you can adapt to that.*
* *Diversity your spending. If you’re just on Facebook, you really need to start using more demand-led channels like Google Search*
* *Build up your email list. As auction pressure gets high and demand decreases, your email list will become so important. Start investing in that now.*
* *Diversify your business. What one thing lockdown has taught us is businesses are great at pivoting and adapting their product to the times. Just because lockdown is ending doesn’t mean you should stop.*

[pepesilvia189]

Could this at all be related to big companies pulling their FB ads entirely in support of BLM? This loss of revenue on CBS side could trigger some adjustments to their calculations?

[Gialupo]

I am experiencing the same thing in Italy, cost per conversion almost doubled in June. Campaign with $20 bid per install are not delivering

[leftyson4]

Yes, same experience. Mid-June

[chrisbangkok]

Same here, last week our US campaign that was generating hundreds of conversions per day since months dropped by 95% from one day to another without any reason

[rna77]

What about YouTube ads? Is that a better place to be and to diversify? Anyone have stats or tracking about running YouTube ads?

[landed_at]

I never found them acceptable but hope that they will optimise one day.

[hellomelissabell]

Could be due to COVID. With more people at home and a push for online businesses (Shopify stores in-particular) there’s more competition.

[ultimaRatio_]

For me it’s the total opposite. Cost per conversion is less than half of what it used to be. I have no idea why, but as people say: do not change what is working.