What is the Average Cost Per Lead on Facebook Ads? | How To Lower Your CPL

April 2, 2024

The average cost per lead on Facebook ads is $5. This is based on the estimates from marketers with same advertising budget set. Effective targeting, interesting ad creatives, and other factors optimize CPL. A good CPL for Facebook ads may be different per industry, but a lower cost is favorable. 

Cost per Lead (CPL) is a key metric used in marketing to evaluate the efficiency of lead generation efforts. This metric assesses the cost-effectiveness of acquiring potential customers. CPL is calculated by dividing the amount spent on marketing or advertising by the number of leads generated. For example, a marketing campaign spent $5,000 on Facebook ads and generated 500 leads. By applying the formula for calculating the average cost per lead, we find that the CPL amounts to $10 per lead.

According to DataBox, approximately 33% of 37 survey participants experience have a CPL between $5 and $7. Other CPLs exceeded $25. As many participants were active and established businesses, Facebook ad expenses vary based on the quality of the ads and industry.

In this article, we will explore how Facebook ads work in lead generation, learn the average ad cost per click for different industries, understand the factors affecting cost per lead, and discuss how to lower CPL on Facebook ads.

How Much Do Facebook Ads Cost?

A Facebook ad cost varies and is influenced by several factors. These factors include your target audience, ad objectives, ad placement, ad quality, and competition within your target audience.

WebFX states that the costs of Facebook advertising vary. The typical rates per click range from $0.26 to $0.30, while the cost per impression falls between $1.01 and $3.00. Additionally, the expenses for each like range from $0.00 to $0.25, and for each download, it varies from $0.00 to $5.00.

Advertisers need to align their budget with specific goals, considering the cost ranges for different ad interactions. This insight enables businesses to make informed decisions and enhance the efficiency of their Facebook advertising campaigns.

How Much Do Facebook Ads Cost Per Month?

Facebook ads cost per month ranged from $200-$800, according to Truelogic. However, the specific amount varies based on the company's size and budget. For enterprises, they may opt to invest up to $5,000 in social media advertising, particularly on platforms like Facebook. The cost is flexible and tailored to the financial capacity and marketing strategy of each organization.

Is $5 a day enough for Facebook Ads?

$5 a day is enough for Facebook Ads if you implement the right strategies, like using this amount as a starting baseline. If you start small, you can minimize the risk and gradually scaling up after experimenting with different ad sets, parameters, and target audiences. So, $5 a day to start may be very strategic and cost-effective Facebook advertising. 

Ultimately, social media advertising doesn't necessarily require a large budget. Visioneerit asserts that a successful Facebook ad campaign can be built with just $5 per day, totaling $150 to $155 per month if run continuously.

6 Factors That Affect the Cost Per Lead on Facebook Ads

The 6 Factors that affect the cost per lead on Facebook Ads include Facebook ad placement, efficiency of audience targeting, ad creatives, landing page quality, bidding strategy, bidding budget, and competition level of industry.

1. Facebook ad placement

The placement of your ads on Facebook can affect costs. Different placements, such as News Feed, right column, or Instagram, may have different costs associated with them. Testing and optimizing your ad placement can help find the most cost-effective option for your campaign.

A 2022 survey of global advertising and media-related agencies, 96% of respondents considered Facebook news feeds the most successful ad placement. This suggests that advertisers prefer Facebook for successful ads. This platform is a strategic choice because of their widespread user engagement. Businesses should invest in social media platforms with proven success rates.

2. Efficiency of Audience Targeting

The precision of your audience targeting affects the ad relevance to the intended audience. If your targeting is too broad, you might reach people who are less likely to convert, leading to higher costs. Refining your audience based on demographics, interests, and behaviors can improve the efficiency of your ad spend.

3. Ad Creatives

The quality and appeal of your ad creatives influence user engagement and the cost per lead. Compelling visuals, persuasive copy, and a clear call-to-action can impact the ad performance. A/B testing different creatives can help identify which ones resonate best with your audience.

4. Landing Page Quality

A well-designed and optimized landing page that aligns with the ad's message can contribute to lower bounce rates and higher conversion rates, ultimately reducing the cost per lead.

According to Meta, the quality of your Facebook ad significantly affects its performance online. Better-quality ads perform well, while lower-quality ones may cost more and get less visibility, resulting in fewer outcomes. Posting low-quality or policy-violating ads repeatedly may make the system see all your ads as having lower quality.

Ensure that your ads and landing pages are relevant and useful to your target audience. This improves overall ad quality and user experience.

5. Bidding Strategy and Budget

Your bidding strategy and daily/overall ad budget allocation influence how frequently your ads are shown and how much you're willing to pay for each click or impression. Using bidding strategies that align with your campaign goals and adjusting budgets based on performance can impact the cost per lead.

6. Competition Level of Industry

The level of competition in your industry or niche can affect Facebook ad costs. If many advertisers are targeting the same audience, the cost per click (CPC) or cost per thousand impressions (CPM) may increase. Monitoring industry trends and adjusting your strategy based on competitiveness are crucial for cost efficiency.

What is the Facebook Cost Per Lead By Industry?

The Facebook cost per lead by industry varies. WordStream data show the average CPC of Facebook ads per industry.

Industry 

Finance

Internet & Telecom

Home & Garden

Business & Industrial

Jobs & Education

People & Society

Beauty & Fitness

Real Estate

Science

News

Hobbies & Leisure

Pets & Animals

Food & Drink

Avg. Cost per Click

$3.89

$3.07

$2.78

$2.48

$2.11

$2.01

$1.85

$1.81

$1.33

$1.11

$0.68

$0.61

$0.42

These values represent the average cost advertisers are paying for a single click within each industry.

It's important to note that these are averages, and individual campaigns within each industry may have different CPCs based on various factors, such as targeting, ad quality, competition, and other ad settings.

Advertisers can use these values as a reference to understand the general cost trends in different industries on the Facebook advertising platform.

Cost Per Lead of Facebook Ads: 3 Case Studies from Real Facebook Ad Campaigns

Case study #1: Ben Health from Lead Guru's spent £6.50 per lead

In the video, Ben Heath discusses the realistic cost per lead in Facebook and Instagram advertising. He emphasizes the importance of defining what makes up a lead, mentioning that a full-fledged inquiry is considered in the presented scenario.

He shared a case study of a campaign, where £100,000 was spent, generating 15,797 leads at a cost per lead of £6.50 (or approximately $7.50-$8).

Additionally, he highlights that the results obtained are exceptional and not typical, influenced by factors such as the agency's expertise and the campaign budget. Ben also provides benchmarks for a good cost per lead, suggesting that under $30 is decent and under $20 is very good, with considerations for different budgets and business types.

Case study #2: Softtrix was able to achieve cost per lead of $5 to $10

Ami, the PPC head of Softrix, discusses how much real estate Facebook ads cost per lead. 
He shares the cost per click on Facebook targeting only sellers' websites ranges from $0.5 to $0.7. Another one is the cost per lead in specific Canadian cities varies between $5 to $10 for a click.

He also emphasizes that ads for websites targeting buyers, especially those looking to sell homes for cash, have a higher cost per click, ranging from $3 to $4. For campaigns targeting both sellers and buyers, the cost per conversion ranges between $75 to $100, observed in campaigns in Canada and Texas.

He acknowledges that Facebook leads may have lower quality compared to Google leads, as interests on Facebook may not directly align with real estate searches.

Lastly, he recommends remarketing ads for visitors who have not converted, offering potential incentives to improve conversion rates.

Case study #3: Reddit user ShiverzFX claims an average cost per lead of $3.91

User ShiverzFX on Reddit shares his journey on setting up his Facebook ads and has an average cost per lead of $3.91 based on the status of his campaign. Moreover, he seeks advice from seasoned individuals on whether to continue with the new creative or discontinue it. Here's a rundown of the details for his campaign.

  • Ad Performance: Running Facebook ads for four days, made minor changes, including a new landing page and additional video format.
  • New Creative: Currently running a new creative, spent $150 to create it (outsourced), which is a departure from self-created creatives.
  • Typical Costs: Average $1.88 Cost Per Link Click and $3.91 Cost Per Lead in other conversion campaigns.
  • Campaign Overview: Four campaigns running, including warm retargeting, conversion targeting, look-alike audience targeting, and instant form leads.
  • Product Details: High-ticket items priced between $3,500 to $30,000. 
  • Conversion Challenges: Conversion campaigns do not result in direct sales; instead, they lead to the website, with a fraction becoming high-quality leads.
  • Current Results: $3.51 Cost Per Link Click and $20.96 Cost Per Lead for the new creative, with 58 link clicks and 4 leads.
  • Lead Quality: Uncertain about the quality of the leads generated; one lead deemed "garbage," others not yet contacted.
  • Budget Concerns: Feeling uneasy about the advertising budget depleting rapidly; aware of the general 7-day waiting period, but anxious about the current rate of spending.

How Does the Facebook Ad Cost Per Lead Compare to Other Advertising Platforms?

Advertising Platforms 

Facebook Ads

Google Ads

YouTube Ads

Instagram Ads

TikTok Ads

Twitter Ads

Amazon Ads

Average Cost per Lead

$5 - $7

$53.52

$0.10 - $0.30

$0.50 to $1

$1

$0.50 to $2

$0.91

Facebook's cost per lead (CPL) varies based on factors like industry, audience targeting, and ad quality. On average, Facebook CPL ranges from $5 - $7. Comparatively, platforms like Google Ads or other social media platforms tend to have higher CPLs. Other platforms may encounter higher competition due to lower costs offer. This suggests that Facebook generally offers a more cost-effective and flexible option for lead generation. However, results can vary greatly depending on the specific campaign goals and target audience.

How to Lower Your CPL on Facebook Ads? 

  • Consolidate account
  • Focus on one campaign objective
  • Tailor campaigns for specific regions with different ad content based on local restrictions
  • Perform continuous testing
  • Optimize the landing page with an emphasis on simplicity, showcasing product visuals, addressing objections, and incorporating qualifiers to filter out unqualified leads.
  • Conduct regular training sessions and role-playing scenarios with your sales team
  • Prompt lead follow-ups within 10 minutes
  • Implement a rigorous follow-up process. 

Nick Theriot, a marketer with a track record of over $80 million in online revenue from Facebook ads, shares insights on lowering the cost per lead (CPL) on Facebook in 2023. Along with the steps above, he emphasizes the importance of understanding market desires, stages of market awareness, market sophistication levels, identities, hook patterns, and visually articulating value.

The primary strategy discussed is consolidating ad accounts, focusing on one campaign objective, and tailoring campaigns for specific regions with different ad content based on local restrictions.

Another key aspect is finding winning ads through continuous testing. Nick emphasizes the importance of understanding market desires, stages of market awareness, market sophistication levels, identities, hook patterns, and visually articulating value.

Improving the landing page is also highlighted, with an emphasis on simplicity, showcasing product visuals, addressing objections, and incorporating qualifiers to filter out unqualified leads.

The final point involves improving the sales team by increasing sales conversion rates. Strategies include regular training sessions, role-playing scenarios, firing underperforming sales reps, prompt lead follow-ups within 10 minutes, and implementing a rigorous follow-up process.

Ben Heath also claims that he found an easier way to be successful in Facebook ads. According to him, advertisers commonly scale Facebook ads by duplicating successful campaigns, but this approach can lead to auction overlap issues, where campaigns compete against each other in the auction.

Auction overlap warnings are becoming more common in Facebook ad accounts, and this negatively impacts campaign performance as only one duplicate campaign can enter the auction at a time.

Ben recommends against using the duplication method for scaling and advises against creating multiple identical campaigns, as it can lead to confusion and poor performance.

An alternative scaling technique is introduced, involving automated rules in Facebook Ads Manager. The method involves setting up rules to incrementally increase the daily budget by a small percentage (e.g., 3%) based on specific criteria, such as a cost per result below a certain threshold.

The new scaling technique offers the advantage of automated and dynamic budget adjustments, allowing advertisers to scale quickly if results are positive and pull back if performance declines. The method provides a balance between potential upside and downside risk.

How Does Facebook Lead Generation Work?

Facebook lead generation work by using the platform's advertising features to collect information from potential customers who are interested in your products or services.  

Here's a detailed overview of how Facebook lead generation works:

  • Create a Business Page: To use Facebook for lead generation, you need to have a business page on the platform. If you don't have one, you can create it by selecting the "Create" option on the Facebook homepage and choosing "Page."
  • Design Your Ad: Create an engaging ad with attractive visuals and compelling ad copy that encourages users to take action. This action is usually to fill out a lead form.
  • Create a Lead Form: Within the lead generation ad setup, you can create a lead form that users will fill out. The form typically includes fields for information such as name, email address, phone number, and any other details relevant to your business.
  • Set Target Audience: Define the target audience for your lead generation campaign based on demographics, interests, and behaviors. This ensures that your ads reach the most relevant users.
  • Set Budget and Schedule: Determine your budget for the ad campaign and set a schedule for when you want the ads to run.
  • Monitor and Optimize: Once your lead generation campaign is live, monitor its performance through Facebook Ads Manager. Analyze metrics, such as click-through rates, conversion rates, and cost per lead. Adjust your campaign based on these insights to optimize its effectiveness.
  • Follow Up with Leads: After leads are collected, it's crucial to follow up. Use the contact information gathered to reach out to any potential customer through email, phone calls, or other communication channels.

What Are Some Course Options for Learning Lead Generation with Facebook Ads?

Facebook Ads Ninja Masterclass

The Facebook Ads Ninja Masterclass by Kevin David is a comprehensive course providing a step-by-step guide to mastering the latest Facebook Ads Platform. Suitable for marketers of all levels, the course offers proven success strategies and powerful hacks for creating highly profitable Facebook marketing campaigns. No prior experience is required, as the course caters to beginners and seasoned veterans alike. With fail-safe strategies and detailed instructions, participants can learn to build laser-targeted ads. Whether aiming to enhance personal business or start a Facebook advertising agency, success is attainable by following the course's A-Z modules.

6 Figure Agency

Billy Willson's 6 Figure Agency is a comprehensive social media marketing agency (SMMA) course designed for beginners to intermediate learners. Founded with the goal of guiding students from starting point to a six-figure revenue, the program emphasizes rendering marketing services to local businesses. The course aims to equip individuals with the skills and strategies necessary for success in the field. 

Lead Generation Blueprint

Lead Generation Blueprint is a detailed guide on lead generation, outlining the methods the creator used to secure over 10 lead generation clients and achieve financial success. The goal is to help others escape the 9-5 routine within 60 days.

The guide is practical and avoids unnecessary information, with each video serving a specific purpose. The creator Ryan Wegner emphasizes that the methods are tested and proven, having personally built a successful business without formal education or significant time investment.

Are Facebook Ads Worth It?

Facebooks ads are still worth it as one of your marketing strategies. It is popular choice for businesses seeking to generate leads and drive sales for a long time. However, the landscape is changing, and the rising costs of paid advertising are prompting businesses to explore alternative strategies.

Investopedia reiterates Facebook's cost per click (CPC) and cost per thousand impressions (CPM) can be too expensive when implemented. Businesses are experiencing higher expenses in their advertising budgets. According to WordStream, the average click-through rate (CTR) for Facebook ads hovering around 0.90%. This make some entrepreneurs questioning whether the investment is truly worth the return.

With local lead generation, it is a cost-effective and high-return alternative to traditional Facebook Ads. This approach focuses on capturing leads directly within your target market, eliminating the need to pay for expansive ad reach. Local lead generation allows businesses to connect with potential customers in their specific geographical area. This targeted approach not only reduces the Facebook advertising cost but also increases the likelihood of converting qualified lead into paying customer.

Ready to explore the benefits of local lead gen for your business? Learn how our proven local lead generation program can not only save you with high Facebook ad costs but also boost your bottom line.

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