Pay per click or pay for impressions: Which is better for your business?


Over the past year, I have managed several Facebook ad campaigns and one of the most challenging elements is always  choosing between paying per click and paying for impressions.  Since it is always a debatable question, I’ve also done some research.  Here’s a quick explanation on how to decide.

What’s the Difference Between the Two?

In case you’re new to online advertising, let me explain both options. In pay per click advertising, also known as PPC, advertisers are charged only when a viewer clicks their ad.  Depending on the advertising platform and competition, a click can cost anywhere from 50-cents to several dollars.  In pay for impressions advertising, also known as CPM, advertisers are charged every time their ad is seen by a viewer,  usually measured as a flat cost per thousand viewers. In CPM advertising, it’s common to pay less than 25-cents for thousands of impressions.

When is PPC Advertising a Better Choice?

According to my own experience and what I’ve read, PPC advertising works better for businesses targeting  very narrow, very specified markets. A word of caution, the key here is to know your market.  If you are unable to choose your targeted audience correctly, you may not do well.  It’s also wise to be aware of rogue clickers (as I like to call them) who will click on your ads just to get into your wallet.  This is a nasty little practice often used by rival businesses to drain advertising budgets.  While individual clicks cost more than impressions, in PPC advertising you only have to pay when someone actually takes an action (clicking) based on the ad.  Think of it as only paying for results.

When is CPM Advertising Better?

CPM advertising is more effective for businesses targeting wider audiences, want to increase brand awareness, or have smaller budgets.  While CPM is usually a much less targeted form of advertising, it is usually very economical, and will still result in visitors clicking through to your website.  And, you won’t have to worry about competitors racking up charges on your account by repeatedly clicking your ads.

Something I’m Trying

In a Facebook ad campaign I’m working on at this moment, I’ve setup the ads as half PPC and half CPM to see which method produces the most results.  Utilizing both also creates a nice safeguard until I’m absolutely sure I have my PPC demographics set just the way I need them.

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