While "likes" lift, CPC ads become more expensive.
Like-gating was one of 2011's earliest trends in Facebook marketing, and Efficient Frontier's new study suggests the tactic is being successfully employed. The digital marketing company's report said brands on average will double their number of "likes" year-over-year by October.
A strong suggestion from the study: "Brands looking to acquire Facebook [likes] need to do so now. With marketplace ad CPCs increasing and already active brands exploiting the channel, there's no time to waste."
Indeed, buying Facebook ads to gain likes is evidently getting pricier. In the study released yesterday, Efficient Frontier said the average cost-per-click (CPC) rate for Facebook ads jumped 22 percent during the second quarter. And the Sunnyvale, CA-based company said it expects the cost to continue to rise for the remainder of the year, resulting in a cash windfall for the social site.
"Even if CPCs increase at 20 percent per quarter for the remainder of the year, this will still result in an 80 percent growth in a year," the report said. "This could reasonably equate into a doubling of Facebook's revenue from marketplace ads."
The study leverages Efficient Frontier's recent Context Optional purchase, which dramatically increased the former's Facebook marketing clients and potential for data-based insights. Dubbed "Global Digital Marketing Performance Report: Q2 2011," its findings are based on the ad spend data of more than 60 brands, while looking at 20 million Facebook "likes."
The research also stated that search advertising increased by 8 percent in Q2, a dip from the 17 percent lift the niche saw in the previous quarter. Here's an excerpt from the report analyzing if Facebook ad spends are hurting search engines:
"At this point, most signs seem to point that Facebook spend is incremental and not cannibalizing search. However, we anecdotally know that some cannibalization has started to occur in retail during promotional times. Second, in the entertainment category we have some very large advertisers who solely advertise on Facebook. This also hints that there are new advertising budgets from the gaming and dating sectors going to Facebook which would not have gone into search otherwise."
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Christopher Heine was a senior writer for ClickZ through June 2012. He covered social media, sports/entertainment marketing, retail, and more. Heine's work has also appeared via Mashable, Brandweek, DM News, MarketingSherpa, and other tech- and ad-centric publications. USA Today, Bloomberg Radio, and The Los Angeles Times have cited him as an expert journalist.
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