how much does a facebook fan cost in the arab world?

January 2013Presented by The Online Project

How Much Does a Facebook Fan Cost in the Arab World?

2Presented by The Online Project

IntroductionWhy read this report?

The use of social media by brands to engage with customers and prospects continues to grow in the Arab world. Brands are using platforms like Facebook to convert daily interactions with audiences into lasting relationships that will ultimately drive business objectives. Statistics indicate that the average user spends 6 hours and half on Facebook every month*, giving brands ample time to connect with audiences. After setting up a brand page and creating engaging content, you need to recruit relevant fans to your brand, a process usually done through advertising, so you have an audience to engage with. But how can you measure whether your Facebook ads are successful or not? Because scarce resources exist in the Arab world on the cost associated with recruiting fans through the platform, we set out to benchmark this. We also explain how the platform works and what factors influence the costs associated with fan recruitment, so you can be able to benchmark and optimize the performance of your ads. In this report, we shed light on the average cost per fan in 11 countries in the Arab world across eight industries. We picked these broad industries based on their popularity on

* Source: https://www.facebook.com/business/power-of-advertising

https://www.facebook.com/business/power-of-advertising



Facebook. If you cannot find your industry in our report, then you can benchmark against the one that is most relevant.

For example, the average cost per fan for a travel agency might be close to that in the airlines industry. For this report, we selected the following industries:

1. Telecom

2. Consumer Goods

3. Automotives

4. Airlines

5. Electronics

6. Fashion (designers, retailers, apparel)

7. Banking and Finance

8. Public Figures

Why use the Facebook advertising platform?

According to statistics in December 2012, over 44 million Arabs are using Facebook, making the platform the ideal choice for brands to use when it comes to utilizing social media for business goals. For advertisers, this becomes even more relevant, especially because its social targeting options are most credible and accurate. According to a Nielsen study, when targeting niche and bored groups, Facebook reaches its intended audience 90% and 95% of the time, versus online industry averages of 35% and 72%*, respectively. When you couple this with the fact that

* Source: https://www.facebook.com/business/fmc/guides/measurement

https://www.facebook.com/business/fmc/guides/measurement



the cost of advertising on Facebook is subject to a bidding process based on supply and demand, this makes the platform both cost-efficient and effective.

What does ‘Fan Acquisition’ mean?

Acquiring fans on Facebook does not mean that you are ‘paying’ audiences to like your page, a misconception often referred to as ‘buying fans’. The difference between the two definitions, besides the fact that fan-buying is unethical (and short-sighted), is that fan acquisition targets relevant audience groups that are likely to engage with your page content. The goal is to acquire the right fans, people who represent your target audience, and who might buy your product or service, spread the word about your brand, thus attracting more potential customers. Inflating fan base numbers will only jeopardize your credibility and deter you from achieving your business objectives. So the goal is to focus on quality likes, not fans by the dozen. Another important point to consider is that fan-buying is simply for the sake of acquiring fan count; whereas the point of fan acquisition is to build a community that you can engage and build a relationship with.



Data & FindingsThe visualized data demonstrate important metrics, such as reach and performance – which we shall elaborate on in this report – alongside the average cost per fan by industry in 11 countries in the Arab world.

Bahrain



Iraq

Egypt



Kuwait

Jordan



Oman

Lebanon



Qatar

Palestine



UAE

KSA



How does Facebook Advertising work?

Factors Affecting the Cost

The Facebook advertising platform is based on an automatic bidding system; which means there is no fixed cost per click, per impression or per fan. What happens is that you set a bid amount either per click or per one thousand impressions and that would be the maximum price you are willing to pay. Then, the cost will be determined according to that amount along with other factors that include reach, performance, and competitors’ ads.

1. Reach: this estimates the number of users you are targeting using Facebook advertising targeting parameters. The more users you are able to reach, the higher your chances of getting a lower cost.

2. Performance: to measure how good your ad is to the target audience, pay close attention to the Click through Rate (CTR), which is the percentage of users who clicked on your ad relative to how many times your ad appeared. A higher CTR means that your costs will be significantly lower.

To improve your CTR, your ad must be relevant to your target audience. For example, when you target users who are using the Arabic interface, your ad



should be in Arabic to increase your chance of achieving a high CTR.

3. Competitors’ ads: this factor refers to other advertisers who are targeting the same audience. Their bid amount and the performance of their ads can have a significant effect on your ad’s cost. A crucial factor here is that the number of competing ads affects your cost; this is directly proportional with the cost of your ads.

It is very important to understand that you can’t control this factor, since it is not possible for anyone to access your competitors’ bidding information. However, the suggested bid amount provided by Facebook can be a good indicator here. Competitors’ CTRs are also not accessible. Yet, you can have a general idea about that after your campaign starts. For instance, if you set the same bid amount for two campaigns with the same CTR, and your second campaign is more expensive, this means your competitors’ performance is better than in the first one. In this case, you have the choice of lowering your bid amount. But then your ad will appear less to your audience, giving the chance to the advertisers who have better CTRs and higher bids to appear more.

What insights can we conclude from this report?

To make more sense of the data and graphs in this report, we shared a few findings from the hundreds of campaigns we have worked on at The Online Project. While some of the insights can be generalized to some countries or industries, we still encourage that you observe what



trends may rise in your communities, as each audience differs from the next.

1. Qatar has the highest average cost per fan, while Egypt has the lowest average cost. We believe that this is due to the fact that ads in Egypt have higher reach, because it has over 11 million Facebook users.

2. For some reason, ads for banking and financial institutions are more expensive than in other industries in most countries in the Arab world.

3. In most of the countries, the public figures category has a low average cost per fan. We can assume that most people like to click on ads that contain a picture of a person, and if the face is recognizable, then it is more likely to get clicks.

4. The airlines, telecom and consumer goods industries have a relatively low cost per fan in all countries. While the electronics and fashion industries have a higher average cost per fan in most countries.

5. The automotives industry doesn’t have the same cost pattern in all countries. The cost of acquiring fans in this industry fluctuates from one country to the other.

6. The UAE has the lowest engagement rate with ads (CTR). This explains the high average cost per fan compared to other countries that have similar number of Facebook users (Reach) such as Jordan and Iraq. This means that people in the UAE are less inclined to click on ads.

7. Saudi Arabia has the lowest average cost per fan among the GCC countries. Obviously, this is due to the high number of Facebook users in comparison to the other GCC countries.



MethodologyThe numbers above are compiled from campaigns run by the Online Project over the past year. We determined the number of Facebook users per country by extracting the number of potential users we can reach upon designing an ad targeting all users in that country.

It is important to understand that these numbers are average numbers. They provide a general idea on the main differences among countries and industries. Providing exact numbers will be difficult, since as explained earlier in “Factors Affecting the Cost”, the factors affecting these numbers are ever-changing. It is worth noting that the data above is drawn from advertising for top pages with a solid fan base, so the cost of acquiring fans are likely to be significantly less if you have just launched your Facebook presence.

In conclusion, what the data reveals is that the cost of acquiring fans on Facebook fluctuates according to the industry you operate in. If you optimize your ad content and make it relevant to your audience, then you can reduce the cost per acquiring one fan below the average in your industry and or country.



About TOP

As the Middle East’s leading social media agency, The Online Project develops and executes social media strategies for Fortune 500 companies and high profile organizations operating in the region.



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how much does a facebook fan cost in the arab world?

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