Retailers are Drooling Over Facebook’s Change to CPC Calculations

July 10, 2015

Digital Marketing Valerie Anders By Valerie Anders

Most of us like to be liked. But when it comes to Facebook CPC advertising, being “liked” isn’t necessarily a good thing. That thumbs-up interaction on your sponsored post is essentially an artificial metric providing zero value when determining your ads’ effectiveness on specific business goals — such as in-store traffic and site visits.

However, Facebook announced an important update yesterday that’s guaranteed to put a smile on the face of many retailers  a new approach to how it calculates CPC that’ll directly affect campaign management.

Traditionally, Facebook counted all interactions with an ad as billable clicks — interactions meaning user comments, likes, shares and clicks to the website.

With the new calculation, Facebook will now only give credit to clicks that actually matter to advertisers:

  • Clicks to visit the promoted site
  • Call-to-action clicks, such as Shop Now, Contact Us, Sign Up, etc.
  • Clicks to install an app
  • Clicks to Facebook canvas apps
  • Clicks to view a video on another website

In addition, advertisers will be able to separately measure performance-based campaigns, user engagement and branding campaigns.

Why This is Important

This shift in reporting is a significant step for Facebook since it now has a more accurate way to compare its ad performance to that of other advertising channels. Essentially, Facebook is leveling the playing field with traditional advertising networks and platforms.

Facebook will begin automatically incorporating the new calculation to accounts in the coming months. This rollout will also coincide with Facebook’s planned improvements to its platform interfaces for Ad Manager and Power Editor.

Facebook can be a powerful way for retailers to connect with customers. To learn more about reaching your target audience via Facebook, click here.


Blog post by Jordan Nowlin, social media and blog manager, ChannelAdvisor