FBX Drives Lower CPMs, Web Retargeting More Clicks

With the launch of Facebook Exchange (FBX) last year, Facebook began allowing marketers to target audiences on the social network, based on their browsing activity on the wider Web. Since formally launching in September, the real-time bidding platform has attracted 1,300 advertisers and is now processing over 1 billion impressions per day.

Facebook and its ad partners have reported promising early results from FBX campaigns. The optimism surrounding the new platform has given rise to the question of whether marketers should shift their retargeting spending entirely to FBX.

To test that idea, AdRoll -- which has over 700 advertisers running on FBX -- compared results from that platform with those from standard Web retargeting efforts.

AdRoll looked at 468 advertisers that ran both standard Web retargeting and FBX campaigns during the last six months of 2012. It found that FBX generally proved more cost-effective:

-CPMs were 82% lower than through Web retargeting.

-CPCs were 70% lower.

But Web retargeting was superior in other ways:

-Click-through rates were higher (FBX was 40.18% lower), requiring less ad frequency to drive attention and clicks.

-Cost-Per-Unique Visitor was lower (FBX was 86% higher), indicating that Web retargeting reaches a larger, more distinct audience for less spend.

“Most surprising, when we compared audience overlap among the campaigns, we found that on average, only 8.3% of an advertiser’s total audience was retargeted by both their FBX and their standard Web retargeting campaigns,” stated AdRoll in a blog post today.

The firm concluded that two retargeting methods have their relative strengths, and that leveraging both makes sense to maximize return on investment.