From the Wall Street Journal, a report on the acquisition cost of Facebook fans. Webtrends studied 11,000 Facebook ad campaigns and found that $1.07 was the average cost of advertising per user that became a brand's fan. Becoming a fan gives brands permission to market directly through free messages sent to a user's news feed and specifically targetted ads.
Click-through rate on ads designed to generate fans fell from .063% to .051% from 2009 to 2010. But during that same period, ad cost rose from $.17 per thousand to $.25 per thousand. Why less effectiveness for a higher price? Facebook users may be learning to ignore ads. And, as more advertisers use Facebook, the auction system used to sell ads has gotten more competitive.
Webtrends is working on research into the effectiveness of different campaigns directed at a fan base, known as “fan nurturing.”
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