Facebook Ad Prices up 30% From Pandemic Lows

By AIT News Desk On Apr 1, 2021

New Data from Aisle Rocket Anticipates Record-High CPMs for Remainder of 2021

Facebook advertising prices are up 30% over their 2020 levels as of mid-March according to new data from Aisle Rocket, a growth-driven marketing agency that unifies creative services, data, and technology to drive results. The ad pricing data, which coincides with the unofficial one-year anniversary of the Covid-19 lockdowns in the US, suggests that the remainder of the year will see extremely elevated CPMs compared to historical precedents.

In pre-pandemic 2020, prospecting costs on Facebook hovered around $8 CPM, which dipped to $5 in March as fear and disruption took hold.
Facebook prospecting currently stands at $8, roughly equal to pre-pandemic levels despite the ongoing emergency.
Models suggest CPMs might hit $11 by late summer and mid-teens by November of 2021.
Ecommerce brands that have flourished during the pandemic will find costs and competition significantly higher.

“Facebook ad prices have historically risen roughly 30% year-over-year before the Covid-19 pandemic, so the fact that we’re seeing a 30% rebound this year – still in the midst of social distancing and vaccination – means that pricing will likely remain very high for the rest of 2021,” said Ross Shelleman, CEO of Aisle Rocket. “The economy is set to come roaring back, and there’s a lot of competition to get in front of consumers who have been sitting on built-up savings they haven’t been able to spend this past year.”

When considered in relation to 2020 Facebook ad pricing, which was subject to unpredictable swings during a summer of social unrest but largely recovered, the Q1 2021 data suggests that Q3 in particular is likely to strain advertisers’ budgets. The agency has suggested numerous adaptation strategies for clients, including:

Broad Audience Dynamic Catalogue Campaigns – These are catalogue-based campaigns that allow Facebook’s technology to display particular products. These were only moderately effective when first introduced, but have seen significant improvements.
Expanded Lookalike Audiences – These allow Facebook to target more broadly adjacent audiences than were available previously.
Cost Cap Bidding – This feature allows Facebook to target audiences for acquisition while capping CPC prices.

“Holiday ad pricing is always a roller coaster on Facebook, and we expect this year to be particularly intense,” said Noah Freeman, Head of Product at Aisle Rocket. “It’ll be important for marketers to be smart in their media planning this year, and expect that CPMs and acquisition costs remain high for the foreseeable future.”