In Advance of Facebook's Q1 2013 Earnings Call, Spruce Media Releases State of Facebook Advertising Report 2013

SAN FRANCISCO, CA--(Marketwired - May 01, 2013) -  Spruce Media (www.sprucemedia.com), the leading provider of enterprise-class marketing solutions for Facebook Ads, today announced the public release of Spruce Media's State of Facebook Advertising Report for Q1 2013.

In this latest report, Spruce Media provides statistics and trends analysis on key campaign performance metrics including cost per thousand impressions (CPM), click-through rates (CTR), and cost per click (CPC), and also offers its take on the social network's advertising products, including Partner Categories, Nielsen OCR and CPA Bidding.

Highlights in the report include the following:

  • CPMs declined in from Q4 to Q1 2013 for two reasons
    • Seasonality (less demand for ads in Q1 than in Q4)
    • Significant supply increase (Facebook opened up more inventory in its highest yielding placement: Newsfeed.)
  • Seasonality (less demand for ads in Q1 than in Q4)
  • Significant supply increase (Facebook opened up more inventory in its highest yielding placement: Newsfeed.)
  • Despite declining CPMs, don't worry about Facebook's financial health -- we suspect that Facebook's revenue remained flat or even increased in Q1. Here's why:
    • More ads may mean lower eCPM per ad, but the sum of the ads yields a higher page eCPM, one of the top indicators of Facebook revenue growth.
  • More ads may mean lower eCPM per ad, but the sum of the ads yields a higher page eCPM, one of the top indicators of Facebook revenue growth.
  • As Facebook re-allocates what inventory is available to its advertisers, everyone wins.
    • Run of Network advertisers (All Facebook) are benefiting from CPC price drops of over 30% and seeing 50% improvements on CTR.
    • Advertisers who are optimizing to Facebook's highest yielding placements -- Mobile and Desktop Newsfeed -- are seeing CTR rates 11-18x higher than Run of Network, and are pocketing up to 50% cost savings in their CPC prices. 
  • Run of Network advertisers (All Facebook) are benefiting from CPC price drops of over 30% and seeing 50% improvements on CTR.
  • Advertisers who are optimizing to Facebook's highest yielding placements -- Mobile and Desktop Newsfeed -- are seeing CTR rates 11-18x higher than Run of Network, and are pocketing up to 50% cost savings in their CPC prices. 
  • Facebook has done a nice job balancing demand for their inventory
    • Facebook's FBX partners continue to increase demand and eCPMs for its "right hand side" inventory
    • Facebook's Native API partners (PMDs and Strategic PMDs) have shifted much of their buying into Newsfeed and Mobile -- higher yielding inventory that is currently unavailable to FBX partners.
  • Facebook's FBX partners continue to increase demand and eCPMs for its "right hand side" inventory
  • Facebook's Native API partners (PMDs and Strategic PMDs) have shifted much of their buying into Newsfeed and Mobile -- higher yielding inventory that is currently unavailable to FBX partners.
  • Facebook is poised to disrupt traditional online display advertising by becoming the starting point for all media buys. Facebook is laying this foundation through a combination of acquisitions, monumental ad product releases, and market strategy.
    • Facebook's proprietary data targeting as well as 1st and 3rd party targeting options are superior to any other publisher or DSP. 
    • Facebook has greatly improved its bidding algorithms and even launched a bidding option of "CPA" which no other publisher has ever done before. 
    • Facebook has the advantage of "identity buying" vs. "cookie-based buying." This in particular is becoming more and more critical as advertisers need a way to reach and optimize to users across devices and identity buying is the only way to do this effectively.
  • Facebook's proprietary data targeting as well as 1st and 3rd party targeting options are superior to any other publisher or DSP. 
  • Facebook has greatly improved its bidding algorithms and even launched a bidding option of "CPA" which no other publisher has ever done before. 
  • Facebook has the advantage of "identity buying" vs. "cookie-based buying." This in particular is becoming more and more critical as advertisers need a way to reach and optimize to users across devices and identity buying is the only way to do this effectively.

The report also covers Spruce's commentary on Facebook's recently released ad products including:

  • Partner Categories (Targeting) - The ability to target based on 3rd party data can save advertisers a lot of wasted impressions as well as drive up the overall CPMs, as advertisers are then able to value each impression more than ever before.
  • CPA Bidding (Optimization) - In April 2013, Facebook publicly released pay-per-action bidding, called CPA Bidding, which for the first time ever, allows marketers to advertise on Facebook without paying directly for clicks or impressions.
  • Nielsen OCR (Measurement) - In Q1, Facebook brought their Nielsen partnership into primetime by allowing Preferred Marketing Developers to offer the measurement solution that, for 8 months, was only available to advertisers who work directly with Facebook on large budget commitments.
  • Facebook has made significant progress on product adoption and doesn't show signs of slowing down in 2013. This brings about a huge opportunity for advertisers that are embracing the social media giant and big challenges in navigating Facebook marketing strategy. More than ever, Facebook is relying on its PMDs, including Spruce Media, to build great technology and provide excellent service to help usher its advertisers into a successful Facebook marketing strategy. 

You can access the full report here: http://clearslide.com/v/6tns6g.

About Spruce Media:

Spruce Media is the leading provider of enterprise-class social marketing technology for the most successful advertisers, agencies, and trading desks on Facebook. One of 13 Facebook Strategic Preferred Marketing Developers, Spruce Media has the highest distinction of excellence offered by Facebook. With over 400 billion impressions managed through its software, Spruce is the technology and service of choice for many of the largest advertisers on Facebook. For more information visit: www.sprucemedia.com.