Facebook Pricing Models: Pros & Cons [Cheat Sheet]
| | Pricing
Model | Description | Pros | Cons |
| | |  | | | | CPM |
| Advertiser pays for every 1000 impressions | Effectiveness at scale and lower cost (assuming you know your audience) Works for every audience size | Wasteful and costly if you (a) don’t have a well defined audience, or (b) do not have the right creative or copy (failing to drive installs) |
|  | | | | OCPM |
| Facebook’s default model lets the Facebook algorithm optimize your goal (whether app installs or engagement) while you pay for impressions. | Easy to use (automatic) Performs well (the larger your audience, the better Facebook algorithm is able to optimize) | Can prove costly Lack of transparency means inability to derive actionable insights or build your own audiences on other networks Not suitable for small niche audiences as Facebook won’t have enough data to work with |
|  | | | | CPC |
| Advertiser pays a predetermined price every time a user clicks on an ad | Good for brand campaigns more traditional marketing like generating leads (rather than installs), driving users to a landing page, and brand promotion | Not a good fit for performance campaigns |
|  | | | | CPA |
| Advertiser pays a predetermined price for a pre-defined action (i.e. app open, in-app purchase) | Control Performance Risk free | Can be difficult to scale. Facebook will show ads only to users who they determine are likely to take the desired action. You can’t run CPA campaigns from day 1, as its engine needs time to learn |
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