When you look at all of the bidding options within Facebook, it can become overwhelming. Do you choose CPC, CPM, OCPM, or CPA? There are a lot of different variables that come into play based on your goals. I will try to explain the options so that you can make a more informed decision as to which bid type to use.
Old School: CPC & CPM Bidding
The two most basic forms of bidding are CPC and CPM. CPC stands for cost per click and just as it sounds you are charged on a per click basis. CPC can be advantageous if you know your conversion metrics and are willing to pay a set amount per visitor to your website.
CPM stands for cost per one thousand impressions. You specify how much you are willing to pay for one thousand impressions of your ad on Facebook. The CPM is a great if you are trying to drive brand awareness for your product or business and trying to get your ad in front as many people as possible.
In some cases, your cost per click will be lower if you use CPM as opposed to cost per click. If you have a great image and creative with a good click through rate, your campaign will be rewarded with a lower cost per click.
New School: CPA & OCPM
With CPA & OCPM, you are telling Facebook that you are willing pay to a set amount or below that amount for certain actions. Again, if you know your numbers and conversion metrics, this can be extremely effective.
What Is oCPM?
oCPM is short for Optimized CPM. It works similar to CPM, pay per impression, but it is optimized by Facebook based on the objectives that you set.
You have a couple of options when it comes to oCPM bidding. The first option is to used default bids, which is recommended by Facebook. Facebook will set the default maximum bid price that it believes will show your ad to the most people.
The second option is to manually set bids through oCPM. You can set bids based on clicks, reach, social, and actions. For example, you are really only interested in clicks. You can set the maximum amount that you are willing to pay for a click. Another example would be the maximum you are willing to pay for an action. Actions are items such as comments, likes, and shares. Be careful with actions, they can be very broad with their definition of actions. If you are only willing to pay a set amount for an action than set the bid where you are most comfortable.
What is CPA?
CPA stands for cost per action. You are bidding on an action, the maximum amount that you are willing to pay for that particular action.
Here are the actions that are currently available:
Key Page Views
Add to Cart
Other website conversions
If you know, your metrics and numbers cost per action may be the best option.
Which Bidding Option To Use?
CPC and CPM are pretty straight forward in regards to what you are paying for and getting. They can be effective if you have a solid understanding of your metrics and numbers.
Which bidding option you choose is going to depend on your objective. oCPM gives you the most flexibility and could put your ad in front of the most eyes. oCPM is a great option to get engagement with your post and increase brand awareness. If you are looking for a specific action such as sales or form leads oCPM is probably not the way to go.
CPA can be effective if you know what you are willing to pay for an action. Be careful with this option as I mentioned earlier, Facebook can be very broad with their definition of actions.
Test, Test, and Test Some More
My recommendation is to try all of the options and test out which is going to work best for you. The great thing about Facebook is that you can have a relatively small budget and at the same time get enough data to determine which option is working the best. Once you have determined which bid option is the best for your situation, test some new ads and dial in your campaign.