As a user of Facebook advertising, it is necessary to understand the seasonality of CPM (Cost Per Mille) and advertising competition. Because only the change of CPM can turn an advertisement with a high conversion rate into an advertisement with poor effect.
Users who advertise throughout the year should find that this time of year is always more difficult, but this does not mean that advertising at this time will not be profitable. What we need is to understand the current environment and how the current environment affects advertising performance.

The seasonality of CPM

First, CPM, the cost per mille, is affected by many factors. Our Facebook ads are bidding with millions of other advertisers, which can be understood as a competitive auction. Among them, due to the advertising quality, the scale of audience, competition among advertisers, etc., the price in the auction has been pushed up. In western countries, there are more holidays at the end of the year. Because some brands only choose to advertise during holidays, or some advertisers spend more during this period, competition amplifies at the end of the year.
Therefore, with the injection of more advertising funds, “audience inventory” becomes tenser, and the competition for the same audience becomes more intense. As a result, the cost of reaching these audiences has increased - CPM has increased.

Impact of CPM increase

It can be imagined that your advertising is still profitable in September and October. After two months, the cost per result increases sharply, but the changes in other indicators are not big. Your ad conversion rate remains the same, but you reach fewer and fewer audiences with the same budget, which results in fewer conversions per day.

Why is this? Because the CPM has increased

As we all know, during the holidays at the end of the year, CPM may double or even triple. In this case, supposing that the conversion rate cannot continue to increase, the conversion cost will naturally increase by one-fold or even twofold.
In a “normal year”, this should be a normal phenomenon. At this time last year, it might be due to the isolation caused by the epidemic leading to people being eager to surf the internet, so the value of CPM is different from that of now. But if compared with earlier this year, it should increase.

CPM increase is still profitable

There is a reason why brands and advertisers are more competitive with each other during this period - people tend to spend more during holidays. Therefore, the conversion rate of advertising will improve during this period. Therefore, we can cope with the increase in CPM by improving the conversion rate, such as offering discounts or defining products as gifts, etc.
What we need to know is that if we continue to advertise in the same way throughout the year during the year-end holiday, the effect will only get worse. This may be a challenge for most Facebook ads users. Only by paying close attention and understanding current problems can we find solutions to such problems.

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https://veryfb.com/d/22-facebookcpm