Q3 2016 Benchmark Report: Advertisers on Facebook Scale Revenue Through Video and Dynamic Ads

Advertising Automation Software

Global Facebook Advertising Benchmark ReportQ3 2016


KEY TRENDS: ROAS Climbs As Ad Spending Rises

For the 20 highest-spending ecommerce and mobile game advertisers using Nanigans over the past year, return on ad spend rose year-over-year in Q3 2016. Meanwhile, these higher returns spurred those same advertisers to increase quarterly budgets over the same time frame.


KEY TRENDS: Game Marketers Choose VideoThanks to continuous growth over the past year, video ads now constitute 50%+ of game advertisers’ mobile ad spend. Video’s share of mobile spend is up significantly since Q3 2015.

Video ads have proven to be effective at capturing high-value mobile game users, and the average CPI has generally trended downward.


KEY TRENDS: Ecommerce Embraces Dynamic Ads

Online retailers using Nanigans continue to invest more ad budget in Facebook’s Dynamic Ads, with spend increasing quarter-over-quarter in Q3 2016.

Dynamic Ads can be highly effective in driving new purchases, generating upsells and growing average order value. Adoption is likely to continue accelerating among ecommerce advertisers during the critical Q4 holiday shopping season.

http://www.nanigans.com/blog/fb/ecomm/facebook-dynamic-product-ads-retargeting-study

http://www.nanigans.com/blog/fb/ecomm/facebook-dynamic-product-ads-retargeting-study


KEY TRENDS: FAN Helps Drive More Clicks

Among Nanigans advertisers spending on Facebook’s Audience Network through Q2 and Q3 2016, CTRs rose quarter-over-quarter, driving up aggregate CTRs in the process.



Global CTR

Global Facebook CTRs have reached a new high at 1.66%, rising 41% in Q3 2016 – the largest quarterly increase in two years. The increase in CTRs in reflective of the continuing and growing dominance of engaging mobile and video ads, as well as the dramatic expansion of Facebook’s Audience Network.


Ecommerce CTRCTRs across ecommerce advertisers jumped 50% quarter-over-quarter. Additionally, ecommerce advertisers committed 10% more of their budgets to mobile inventory compared to Q2 2016.

Now commanding over 71% of total Facebook ad spend from online retailers, mobile has driven approximately 4X higher CTRs over desktop throughout the past year for these advertisers.


Gaming CTR

In the gaming sector, CTRs reached 0.85% in Q3 2016, up 23% quarter-over-quarter and 32% year-over-year. Increased click engagement across ad types likely indicates Audience Network growth as a dominant factor in this quarter’s trend.



Global CPMAggregate global CPMs dropped by 9% quarter-over-quarter, but remain up 15% on a year-over-year basis. This represents the smallest year-over-year change since Nanigans began conducting these reports in 2013. Currently at $5.94, average CPMs have returned to the same level observed in Q1 2016.


Ecommerce CPMIn part due to growth in the Audience Network, which tends to command lower ad prices than native Facebook inventory, ecommerce CPMs dipped 22% in Q3. The year-over-year change stands at -10%. The downward trend is unlikely to continue, however. Online retail advertisers typically see some of the greatest CPM changes during the Q4 holiday season.


Gaming CPMGame advertiser CPMs remained virtually flat, rising by only $0.01 quarter-over-quarter and falling 6% year-over-year. This marks the gaming vertical’s sixth straight quarter of aggregate CPMs remaining between $4 and $5.



Global CPC

In line with a significant increase in CTRs and a moderate decrease in CPMs, Facebook CPCs declined 35% quarter-over-quarter and 34% year-over-year. At $0.36, CPCs are the lowest rate observed since Nanigans began conducting these reports in 2013.


Ecommerce CPCEcommerce advertisers experienced a drop in CPCs this quarter, which now stand at $0.26. Thanks primarily to higher CTRs and lower average pricing for Audience Network inventory, CPCs declined by 48% quarter-over-quarter and 54% year-over-year.


Gaming CPCs

Changes in gaming advertiser CPCs were more moderate than other verticals. The current average of $0.54 is on par with that of Q1 2016. The figure represents a drop of 19% quarter-over-quarter and 29% year-over-year.



Geographic Trends

The Facebook advertising ecosystem can vary from region to region, and marketers should always tailor their performance goals and strategies for each geographic market.

To give advertisers insights on global trends, Nanigans analyzed campaigns targeted to specific countries in Q3 2016.


Geographic TrendsTo ensure statistical significance, country spend, clicks and impression data is grouped into geographic regions:1) The Americas2) Europe, Middle East, and Africa (EMEA) 3) Asia-Pacific (APAC)Each region accounts for tens of millions of dollars of Facebook ad spend through Nanigans.


Geographic Trends


About This ReportThis report is representative of Facebook® ad impressions delivered by customers leveraging Nanigans advertising automation software. It includes ad spend on Facebook desktop, Facebook mobile, and Facebook Audience Network, and excludes Facebook Exchange and Instagram.

The vast majority of Nanigans customers are direct response advertisers at ecommerce, gaming, and other Internet and mobile companies. In Q3 2016, 96% of spend from these direct response advertisers was allocated to four Facebook ad products: Unpublished page post ads, mobile app install ads, domain ads, and dynamic ads.

The majority of these direct response advertisers leverage Nanigans’ ROI based bidding algorithms, which focus on reaching high-value and high-ROI audiences (e.g. those who make purchases) and typically cost more to reach. As such, the data in this report may not necessarily be a proxy for the overall Facebook marketplace.


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Q3 2016 Benchmark Report: Advertisers on Facebook Scale Revenue Through Video and Dynamic Ads

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