Re:Had a call with Reddit to discuss pricing. Bad news for t...
by tivert on Wednesday May 31, 2023 @05:08PM
(#36144359)
>> Facebook's average revenue per user (ARPU) is ~$10/quarter[0], and 6x that in the US.
> Can someone explain this to me? Why is it so high? Even if every single person on Facebook buys a product because of ads once per year, doesn't that mean companies are paying $240 to acquire a customer in the US? Is it worth that?
1. I wouldn't be surprised if lots of businesses lose money on their Facebook ads, but either don't realize it or Facebook has enough churn that it doesn't matter if the quit (e.g. a revolving door of unsophisticated local businesses spending money on Facebook because it's the biggest game in town).
2. A lot of advertising is broad "brand awareness," and I imagine it's actually very hard to determine if it's actually working in many cases.
> Can someone explain this to me? Why is it so high? Even if every single person on Facebook buys a product because of ads once per year, doesn't that mean companies are paying $240 to acquire a customer in the US? Is it worth that?
1. I wouldn't be surprised if lots of businesses lose money on their Facebook ads, but either don't realize it or Facebook has enough churn that it doesn't matter if the quit (e.g. a revolving door of unsophisticated local businesses spending money on Facebook because it's the biggest game in town).
2. A lot of advertising is broad "brand awareness," and I imagine it's actually very hard to determine if it's actually working in many cases.