Does Facebook Inc (FB) Offers Cost-efficient Advertising?

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Facebook Inc (NASDAQ:FB) advertising in the second-quarter has outperformed other platforms (network, portal and exchange) in terms of reach efficiency and the average cost. A study from Neustar focusing on the cost efficiency found that the social networking efficiency in the second-quarter is 70% cheaper than the Industry average. Also, Facebook emerged as the only channel that surpassed the indexed average for reach efficiency, over ad portals by 286%.

Does Facebook Inc (FB) Offers Cost-efficient Advertising?

Massive video potential

Mobile and video emerge as the two primary factors for the Facebook Inc (NASDAQ:FB) popularity. Senior Vice president of Media and Advertising at Neustar Rob Gatto said that the video potential of Facebook is massive.

However, recently there were reports that auto-play video feature in Facebook Inc (NASDAQ:FB) costs users too much. This might dent the performance of the video ads marginally as users can change the default settings to stop the auto-play feature.

“One interesting thing I see in video is that most advertisers are content to buy it simply with age and gender as an overlay. After all, that’s typical of how you buy television.”

Gatto said that the companies do a lot of things in the display, but the same is not yet applied in the videos. Neustar said that calling Facebook entirely cost efficient would not be right, but after analysing Facebook Ins’s CPM, CPC and CPA, ad networks, ad portals and ad exchanges in the second -quarter, it can be said to be the cheapest.

Facebook better on many fronts

Ad cost over Facebook Inc (NASDAQ:FB) actually declined 32% from the first-quarter, says the report. According to Neustar, a probable reason for the increase in ad network costs would be World Cup, where advertisers spend too much in contextual video advertising around soccer sites and content.

Even though Facebook might be top most when it comes to creating a cost-effective option, an ad exchange is the most optimal way to find quality users, who can be reached more than once. The social networking site is building on and performed better than the industry average.

Going by Funnel attribution, Facebook advertising makes a better mark than ad exchanges, second only to ad networks. According to Neustar, Facebook Inc (NASDAQ:FB) has evolved as an ad platform for conversion, primarily due to the increased paid reach in the second-quarter.

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