To better understand the importance of reach in a digital world, Facebook Marketing Science conducted research to determine how efficient reach is in driving impact to more people and real business results at scale for brand advertisers.
To illustrate a brand advertiser’s dilemma between achieving precision and scale, consider the following campaign scenarios:
In the digital space, advertisers often have the ability to define their target audience using a variety of different signals, such as demographics, interests, or behaviors. While very precise targeting may lead to a higher response within a target audience, it’s important to understand the trade-offs. Is optimizing towards reach the most important lever brand advertisers can pull?
Facebook conducted a study and found that optimizing towards action-based metrics results in reaching a larger percentage of more expensive users. Action-optimized bidding resulted in an 80% higher average user CPM versus reach-optimized bidding.
Consider a simulated eight-week campaign. Based on Facebook’s findings, an average CPM for action-optimized bidding is higher than reach-optimized bidding, but the lift in awareness is similar across both. From this simulation, the brand advertiser would get a larger reach (5.2 million people) with reach-optimized bidding than with action-optimized bidding (2.9 million people). And given that both optimization scenarios have the same campaign budget, the same frequency and the same expected lift in brand awareness, reach-optimized bidding would drive more scale and therefore be more cost-effective in terms of generating brand awareness.
By optimizing towards reach rather than towards action-based objectives, advertisers can generate a much larger impact for their brand, more cost-efficiently.
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