2024 has seen a sharp rise in the popularity of AI generated content, allowing for more personalized, efficient, and cost-effective campaigns.

An analysis of advertising spend trends reveals a stark contrast between 2024 and a decade ago. In 2014, global digital ad spend stood at $108.47 billion¹. Fast forward to 2024, and that figure has skyrocketed to an estimated $442.6 billion. This meteoric rise isn't just about more money being poured into digital channels; it's about a fundamental shift in how advertisers reach their audiences.

But what does this mean for your bottom line? Let's break down the costs across major platforms and explore how AI is influencing the numbers.

Social media platforms' ad pricing models and average cost ranges

To compare pricing across platforms, we'll look at three key metrics: Cost per Click (CPC), Cost per Mille (CPM), and Cost per View (CPV). CPM is the price advertisers pay for every 1,000 ad views on the platform; CPC is the price advertisers pay each time a user clicks on their ad; and CPV is the price advertisers pay each time their video ad is viewed.

Keep in mind that these figures can vary drastically depending on factors like targeting, industry, and seasonality.

How much do Facebook ads cost?

Facebook, under the Meta umbrella, shares an advertising platform with Instagram. The average CPC for Facebook ads ranges from $0.52 to $0.65². The average CPM of $11.38³.

How much do Instagram ads cost?

Instagram, while using the same platform as Facebook, tends to have slightly higher costs. The average CPC for Instagram ads was $1.22 last month, with an average CPM of $12.11⁴.

YouTube advertising cost

YouTube offers various ad formats, but let's focus on in-stream ads. The YouTube advertising cost for these ads is often measured in Cost per View (CPV). The average CPV ranges from $0.11 – $0.50⁵. If you’re interested in YouTube’s CPM, too, is averaged at $15.34⁶

X ads’ average CPC and CPM

The platform and its advertisers have faced turmoil with Musk’s takeover, resulting in an affordable platform with potential. X's ad costs can vary widely. The average CPC for X ads sit quite low at $0.07, while the average CPM (February) was $1.73⁷.

LinkedIn ads’ pricing

LinkedIn, with its predominantly B2B focused users, tend to command high advertising costs. The average CPC for LinkedIn ads as of May 2024 was $5.39, with an average CPM of $6.37⁸.

TikTok ads’ costs

Businesses that can advertise effectively, adapting to Gen Z’s nuanced way of consuming ads continue to reap rewards, with the potential to go viral always a possibility. The average CPC for TikTok ads last month was at $0.66, with an average CPM at $4.41⁹.

Snapchat ads’ competitive pricing

Snapchat's advertising costs are competitive. The average CPC for Snapchat in early 2024 was $0.70, with an average CPM of $3.03¹⁰.

Factors affecting ad costs

While the averages we've discussed provide a baseline, several factors can significantly influence your actual ad spend:

• Audience targeting: The more specific your target audience, the higher the potential cost. For example, on LinkedIn, targeting C-level executives in the tech industry in Silicon Valley will likely cost more than targeting a broader audience of all professionals in the United States.

• Ad format and placement: Premium placements and formats often come with a higher price tag. On Instagram, Stories ads are generally less expensive than Feed ads.

• Industry and competition: Competitive industries typically see higher ad costs. On Facebook, the finance and insurance industry has one of the highest average CPCs¹¹.

• Seasonality and timing: Costs can spike during peak seasons or events relevant to your industry. For instance, advertising on X during major events like the Super Bowl or Black Friday.

Reduce your advertising costs with AI tools

The costs of advertising across different social media platforms can be mitigated through AI generated ads. Tools like Creatify optimize content creation and ad spend in several ways:

1. Rapid content creation: Creatify can generate thousands of ad variations quickly, significantly reducing production time and costs. This is especially useful for platforms like Facebook and Instagram, where testing multiple versions is essential.

2. URL to video feature: This tool transforms any webpage into a video ad, minimizing the need for expensive video production, which is particularly beneficial for platforms like YouTube and TikTok.

3. AI-generated scripts, designs, and avatars**: These features reduce reliance on costly copywriters, designers, and actors while still producing high-quality content. This is advantageous for platforms like LinkedIn, where professional content is crucial, even more so with the testing of vertical video.

By leveraging these AI tools, businesses can create effective ads across various platforms at a lower cost, allowing for better testing and optimization.

Tips for creating ads and optimizing ad spend

1. Leverage ad variations for A/B testing: Use Creatify's capability to generate multiple ad versions to test different approaches and optimize performance.

2. Utilize AI avatars for audience targeting: Create personalized ads with AI avatars that resonate with specific audience segments, potentially improving engagement and reducing overall ad spend. In fact, you can design your own AI avatar now to become your brand ambassador across regions!

Conclusion

The cost of running ads across social media platforms in 2024 varies significantly. From X's average CPC of $0.07 to LinkedIn's $5.39, understanding these costs is essential for effective budgeting. Global digital ad spend has increased from $108.47 billion in 2014 to an estimated $442.6 billion in 2024, highlighting the growing importance of digital advertising. Each platform presents unique advantages. Here’s a chart recapping the information regarding CPC and CPM per platform:

• Facebook and Instagram offer competitive CPCs and CPMs.

• YouTube commands higher CPMs but provides excellent visibility.

• X offers low-cost advertising options.

• LinkedIn is more expensive but allows precise B2B targeting.

• TikTok and Snapchat give access to younger audiences at reasonable costs.

Understanding the factors influencing ad costs—such as audience targeting, ad placement, industry competition, and seasonality—is crucial for optimizing your budget.AI-generated content is transforming how businesses create and manage ads. Tools like Creatify enable rapid content creation, efficient video production, and personalized messaging, which can lower advertising costs while enhancing campaign effectiveness. As you plan your advertising strategy, focus on setting clear objectives, utilizing AI tools for efficiency, and continuously testing your campaigns across platforms. With the right approach, you can navigate social media advertising successfully and achieve strong ROI.

¹ Global internet advertising expenditure: https://www.statista.com/statistics/273717/global-internet-advertising-expenditure/

² Facebook ads CPC: https://revealbot.com/facebook-advertising-costs/cpc-cost-per-click

³ Facebook ads CPM: https://revealbot.com/facebook-advertising-costs

⁴ Instagram ads CPM: https://revealbot.com/instagram-advertising-costs

⁵ YouTube ads CPV: https://www.webfx.com/social-media/pricing/how-much-does-youtube-advertising-cost/

⁶ YouTube ads CPM: https://www.shopify.com/blog/youtube-cpm

⁷ X’s CPM and CPC: https://www.guptamedia.com/social-media-ads-cost

⁸ LinkedIn ads CPC and CPM: https://getuplead.com/linkedin-advertising-agency/cost/#:~:text=The average CPC

⁹ TikTok’s CPC and CPM for September: https://www.guptamedia.com/social-media-ads-cost

¹⁰ Snapchat ads CPM and CPC: https://www.veuno.com/ad-platform-cost-rises-and-predictions/

¹¹ Facebook insurance advertisers have high CPC: https://www.wordstream.com/blog/ws/2017/02/28/facebook-advertising-benchmarks#:~:text=Even though financial advertisers have,costing about %2450 per click.