There are two different cost models for advertising on Facebook:
* Cost Per Thousand impressions: This is also heard of as pay for views. This is based on the total number of impressions your ad will generate; this means the times your ad is shown to users as they are on the site. This is opposed to more traditional impression- based models where you can be charged for a certain amount of views for a set price. Facebook’s model permits you to make the choice of the amount of money you wish to pay for every thousand views. Your bid is then relative to other advertisers will then determine how many times your ad will show up. The current minimum is $0.02.
* Cost per click: In this pricing you will choose the money amount you want to spend if someone decides to actually click on your ad. You will not be charged until someone clicks on your ad. They can view it without you being charged. This works on a bidding system. The more you are ready to pay for each click the more your ad will show up. The minimum for this type of advertising is $0.01.
In both of these you will have access to a “bid estimator” to show you the bids that are current for your type of ad. The model you should choose depends on the type of business you have and what type of ad you have created. If you are trying to run an ad for a new business where you are trying to get exposure then you choosing the model that the user must perform a specific action might not be the best route. For example, they must sign up to buy a product or a newsletter. This type of campaign would benefit more from a per thousand impressions. If you are wanting to show an ad about a certain event then a pay per click will be more productive for you.