The main difference between ads on Twitter and Facebook is that almost all Twitter ads are integrated into users’ tweet-streams whereas Facebook focuses more heavily on display ads at the side of users’ feeds.This has paid handsome dividends for Twitter, according to a study of 45 billion ad impressions on Twitter and Facebook in Q1 2012 by TBG Digital. TBG is a seller and manager of ads on Facebook. The study looked at cost-per-thousand impressions, click-through rates and cost-per follower to advertisers.
Twitter gets significantly higher CPMs than Facebook and earns more money per impression than Facebook, it turns out. Twitter’s CPM’s can reach more than $3.50; Facebook’s are often less than 50 cents, the data show.
The difference seems to be that users shy away from display advertising because it’s so obvious.
“Facebook puts ads on the right-hand side, which people recognise as ads,” TBG CEO Simon Mansell says. “Twitter puts ads in the stream so it looks more like content. When ads are in-stream you get better click-through performance.”
This explains, in part, why Facebook has been so keen on developing Sponsored Stories both for its web site and its mobile apps.
That doesn't mean Twitter is making more money, of course, but it's a good sign for its business, says TBG Digital CEO Simon Mansell. 'They can sell fewer impressions and still make the same amount of money per user.'
More people use Twitter in the morning and the evening than during the day. The cost-per-follower to advertisers is inversely related to the amount of traffic during the day.
It's supply and demand: Cost-per-follower goes down when there are lots of people looking at Twitter, and it goes up when Twitter's audience dwindles during the slow parts of its day.
CPF is indexed to an average on the left scale; percentage of traffic delivered is on the right scale.
Twitter outperforms Facebook for news, sports and food/drink advertisers in terms of click-through rates.
This chart is indexed to the averages for both companies. In the raw numbers, Twitter's click through rates are a lot higher across the board than Facebook's. By indexing the numbers to an average, we can see that users on Twitter respond more to news-oriented ads and users on Facebook respond more to leisure-oriented activities.
The red bars measure click-through rates, and relate to the scale on the right. They show that Brazilians are much more willing to click through ads on Twitter. Americans are the least likely to click.
The black line measures cost-per-follower to advertisers, and relates to the scale on the left. It shows roughly that it costs more to acquire a follower in the U.S. than it does to get one in Brazil.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.