How are Twitter Ads Costed? Explanation of billing format

If you are considering implementing Twitter Ads, the first thing that comes to mind is your budget. If you are unfamiliar with programmatic advertising itself, you may be worried that the unit price will be higher than expected.

In the case of Twitter Ads, it is possible to set a maximum unit price, so there will be no unexpected unit price. Also, if you can use the unique diffusion mechanism of Twitter Ads, you can keep the unit price low.

In this article, we will explain the billing format, budget, and tips for improving cost effectiveness of Twitter Ads.

Table of Contents

Twitter Ads are characterized by their targeting and billing methods. If you understand these two features and operate it, you will be able to get high efficiency while keeping costs down.

You can target and deliver

Twitter Ads are highly targeted. In addition to age and gender, you can target more than 350 topics of interest and specific keywords .

You can maximize the cost-effectiveness of Twitter Ads by approaching your targeted target audience.

Billing method for Twitter Ads

Twitter ads are billed when a user takes a specific action.

Specifically, let’s see what actions can be set as billing points.

CPM/impression billing

You will be charged for every 1,000 impressions of your ad.

CPF/Follow Billing

You will be charged when you acquire followers through your ads.

CPE/Engagement Billing

You will be charged when there is a reaction from the user, such as a comment, retweet, like, profile click, photo or link click.

CPV/view (playback) billing

You will be charged when the ad video is viewed. The billing timing can be selected from the following.

1. When the video has been played for 15 seconds or has finished playing
2. More than 50% of the video is on the screen for 2 seconds, or the video is zoomed in or unmuted
3. After 3 seconds of full video on screen or when the video is zoomed in or unmuted
4. When 50% or more of the video is on the screen for 6 seconds, or when the video is zoomed in or unmuted

CPC/pay per click

You are charged when a link in your ad is clicked.

CPI/install billing

You are charged when a user installs your app through an ad.

CPAC/app click billing

You will be charged when a user launches an installed app via an ad.

How much does Twitter advertising cost?

Here’s a rough idea of ​​how much you can spend on Twitter Ads:

Twitter Ads costs are calculated by aggregating various metrics. Since the unit price fluctuates greatly depending on the category to be advertised, the scale of targeting, and the number of competitors, advertising costs basically vary depending on the industry and purpose .

It is difficult to predict advertising costs in advance, so let’s get a sense of the appropriate costs for your company through daily operations.

Since Twitter Ads is an auction format, it is important to note that if you set your budget too low, users may not see your ads at all .

Campaign objectives for Twitter Ads can be divided into the following eight types: Twitter Ads are billed based on the objectives you set here, so choose objectives with your campaign KPIs in mind.

• Increased brand awareness
• number of followers
• number of engagements
• number of video views
• website clicks
• App installs or re-engagements
• Pre-roll play count

We will explain in detail the characteristics and billing methods for each purpose.

Increased brand awareness

It is used to increase brand awareness. CPM is used as the billing method.

number of followers

Use it when you want to increase your followers. The billing method is CPF, and if a follow-up occurs from something other than an advertisement, it will not be billed.

number of engagements

The number of engagements is used when you want to increase the number of likes and RTs. The billing method is CPE. You will not be charged for likes and RTs at the RT destination.

number of video views

This campaign objective is set when you want to increase the number of views of the ad video. The billing method is CPV, and you can freely choose the timing at which billing occurs. For more information, please refer to the chapter ” Twitter Ads Billing Method – CPV/View (Playback) Billing “.

website clicks

Use it when you want to increase the induction to the website or CV. CPC is used as the billing method.

App installs or re-engagements

It is used when you want to increase the number of app installs or when you want to increase the number of active users. The billing method can be selected from CPI or CPAC.

Pre-roll play count

It is used when you want to increase the number of video advertisements played before the main part of the video. The billing method is CPV, and the timing of billing can be freely selected. For details, please refer to the chapter ” Twitter Ads Billing Method – CPV/View (Playback) Billing “.

The cost of Twitter Ads is determined by four factors:

1. Bid amount for inventory
2. Ad quality score
3. target volume
4. number of competitors targeting the same demographic

Let’s take a closer look at each.

1. Bid amount for inventory

Twitter Ads is an auction format, and your ‘bid’ is the amount you bid on an inventory. You can choose from the following three bidding methods:

① Automatic bidding

Automated bidding automatically optimizes your bids to get the best results for the least amount of money.

This is useful if you’re not sure what the best bid is, but it can also result in higher CPC bids compared to manual bids, so check back regularly.

(2) Maximum bid unit price

A maximum bid is a form of pre-determined maximum bid that you can afford. You will never be charged more than the amount you set.

If the maximum bid is too low, there will be no opportunities for ad exposure, so it is necessary to prepare a certain amount of budget and adjust the bid according to the situation.

(3) Target bid price

If you select a target bid, your bids will automatically be optimized to match the ad cost you set as your target. However, the actual results may differ from the target values, so regular confirmation is essential.

In addition to the above three, a mechanism called “Second Price Auction” has been introduced for bidding on Twitter Ads . When you win the ad space, the amount you actually pay will be the second bid + 1 yen, not your own bid.

Second-price auctions are characterized by the fact that advertisers can bid at a price close to the market price.

Unlike first-price auctions where you pay your bid exactly as it is, you are less likely to lose money even if you offer an amount that is far from the market price.

2. Ad Quality Score

Each Twitter Ad you create is given a “Quality Score,” which influences your final bid. There are three factors that determine your Quality Score:

• Empathy level: Whether users RT, like, or comment on advertisement tweets
• Relevance: Does the content of the ad Tweet match the interests of the target?
• Freshness: Are you tweeting the latest/seasonal topics?

“Quality Score x Bid = Ad Score”. The higher your quality score, the lower your bid, and the lower your final ad spend.

Let’s continue to work to “increase the quality score = create an attractive ad” and aim for effective operation.

3. Target volume

To deliver ads to a large number of users, a large budget is required. So the more users you target, the higher your bid.

4. Number of competitors targeting the same demographic

The higher the number of competitors, the higher the bid.

The cost of Twitter Ads is determined by these four factors. A particular consideration is ad quality and targeting. Create attractive ads for your target audience and figure out how to reach them. I’ll give you some tips in the next chapter.

The following five measures are effective in increasing the cost-effectiveness of Twitter ads.

• Make accurate targeting settings
• Choose a campaign that fits your goals
• Create the perfect creative
• improve LP
• Set frequency cap

I will explain each measure.

Make accurate targeting settings

Accurate targeting settings can improve the cost-effectiveness of advertising. With Twitter Ads, you can make detailed targeting settings that combine the following groups of items.

• Tailored audience targeting
• language targeting
• Geographical targeting
• Gender and age targeting
• technology targeting
• Keyword targeting
• interest targeting
• follower targeting
• behavioral targeting

Also, clarify your company’s target users in order to make accurate targeting settings. Another option is to set up a persona for your Twitter ads.

If you’re not confident with persona design, HubSpot offers a free persona creation template .

Choose a campaign that fits your goals

The campaign you should choose will change depending on your purpose, such as wanting to increase awareness of a new product or increasing the number of app downloads.

Create the perfect creative

To be more cost-effective, create creatives (videos, images, tweets) that match your target audience’s interests and touch on hot topics.

It is also important to prepare multiple creatives and compare numerical values ​​such as click rate and follow rate. By repeating the A/B test, such as stopping the delivery of creatives that did not respond well, and making further improvements to creatives that responded well, we were able to get closer to the optimal creative.

improve LP

If you choose a “website clicks campaign” for Twitter Ads, it is important to improve the LP and increase the conversion of users who visit the LP via the ad.

Before starting advertising operations, check whether the content of the current LP is aligned with the content of the ad tweet and whether it is designed to be easy for users to use.

Set frequency cap

Setting a frequency cap can be cost effective. Frequency capping is a feature that allows you to set a maximum number of impressions per user.

By limiting the excessive distribution of ad tweets, you can prevent a drop in the response rate and improve your Quality Score.

Not limited to Twitter Ads, in the case of programmatic ads, the ad unit price fluctuates depending on the conditions, so the best way to get a rough estimate of the budget is to actually run it.

First, do a test distribution, judge whether the results obtained there are good or bad, consider CAC (customer acquisition cost) and LTV (customer lifetime value), and work out improvement measures.