Cost of Facebook Ads Jumped 40% This Year [REPORT]

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Efficient Frontier, a digital marketing firm, based its data on its Customer Index, a subset of the company’s client roster. The company manages $1 billion in annual marketing spending on behalf of its clients, which include Discover, Baby Center and Crate & Barrel, among others.

In the report, Efficient Frontier attributes the rise in rates to advertisers’ realization of Facebook’s “tremendous value.” If that’s the case, it’s a turnaround for Facebook, whose inability to monetize its huge user base has been at issue for years.

Part of the problem is that ads on Facebook perform even more poorly than standard banner ads. Even before the jump, though, Facebook posted $1.86 billion in advertising revenues in 2010, according to eMarketer. Facebook serves up more than 50 billion banner ads per month.