„Holy shit“ were the exact words I uttered out loud after putting my calculator down a mere five minutes ago.
What was I calculating?
Something which I haven’t seen almost anyone do yet:
(Or if they did then they’re buried on pages 7+ on Google – and I ain’t going back that far because I’m not THAT arsed about this topic.)
Historical Facebook ads costs.
It is no secret that Meta just keeps ramping up ad costs every year – you know it’s getting more expensive every year. I don’t need to tell you that.
But do you know…
How much more expensive it’s gotten EXACTLY?
Keep reading then.
I used CPM costs for the US market to keep things consistent.
(And also because there’s the most data for the US market.)
Most of the data I sourced from Nanings – which was a big FB-only ad platform that had direct access to spend + logs of thousands of advertisers there.
So I figured they made for a pretty reliable source – that is until 2020.
From 2020-2024 i estimated the CPM cost from Meta’s average price per ad disclosures.
So anyway, here’s the table:
===
2014: $4.40
2015: $6.38 (45% more YoY)
2016: $6.52 (2% more YoY)
2017: $8.66 (33% more YoY)
2018: $9.64 (11% more YoY)
2019: $8.87 (8% less YoY)
2020: $10.14 (14% more YoY)
2021: $12.58 (24% more YoY)
2022: $10.56 (16% less YoY)
2023: $9.61 (8% less YoY)
2024: $10.58 (11% more YoY)
===
Facebook ads get more expensive by approximately 11% every single year.
It was 140% more expensive to run ads on Facebook in 2024, than it was in 2014.
Bear in mind…
Inflation for that same period was around 33% – this means that Zucc the Cucc raised his ad prices over 4x the inflation rate.
And I mean…
Fair play to him – I’d probably do the same thing if I owned the biggest advertising platform on the planet with a 3B user base…
But for you?
This means you would have to keep allocating 11% more capital every year for FB ads…
… just to maintain the same reach and impression volume.
And you know what?
I think this will only get not just worse… but SUBSTANTIALLY WORSE!
Why?
Mainly because of AI.
It seems Zuck is not done throwing insane amounts of money on AI Capital Expenditures.
In just the last 4 years their CapEx has increased at an average rate of 40% – from 18B in 2021, to a whopping 62B TTM.
(That’s a 244% increase in just a short 4 years.)
All because „Meta will have the largest compute fleet of any company.” according to Zuckerberg.
And how will he fund all this?
By making YOU pay more.
(It sure as shit isn’t coming from the Metaverse – I cringe so hard when I remember this guy telling everyone, with a straight face, how „digital property“ will become the most valuable real estate in the world. He burned through $77B on that dumpster fire btw, most of which YOU paid for!)
So if you somehow know of a way to increase your marketing budget by AT LEAST 11% for the next few years consistently…
(And bear in mind, it will probably be more than the 11%/year – the crazy AI money has to come from somewhere, so this is actually a conservative estimate.)
Then all the power to you.
Keep doing what you’re doing and don’t change a thing.
If you don’t? Or are just tired of giving away more money every year to Meta?
Well…
Then might I suggest you consider putting more thought into your email marketing game?
It’s a channel YOU own… where you DON’T pay anyone (except a tiny fee to the ESPs)… with probably even better quality leads/customers than some rando’ who just saw you for the first time on their feed.
And frankly?
I even think that’s going to become a trend in the next few years.
No, I don’t think there will be this revolutionary pivot to email marketing all of a sudden…
But I do think more and more brands will start to find these ever-spiralling ad costs simply too much – so they’ll begin looking for another marketing channel to make it their primary.
(Obviously not abandoning the former – just downsizing.)
Some may go to email, but most likely won’t.
In fact:
Most will probably just hop onto another social media – somehow NOT realizing it’s all the same crock of shit. You still have a landlord that controls the space, sets the rules and can evict you at any time.
Whatever the case, I know where I’ll be:
Still emailing.
[Part of this email’s content has been removed from this Email Echoes version of it.]
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