Brands running ads on Facebook that don’t direct users away from the social networking giant are being rewarded with better deals and cheaper advertising opportunities.

TBG Digital data, collected on a sample of 2.8bn impressions found that Facebook’s algorithm charges a 29% lower cost per click for ads that keep traffic on the site, by directing users to a brand’s Facebook page, for example.

TBG said that Facebook uses in excess of 130 factors to determine the price for any given ad, but the data it collected shows that whether you keep traffic within the site is a key factor.

Simon Mansell, CEO of TBG Digital, said: “A big part of the algorithm is whether you send traffice on or off Facebook, because it wants to keep people on the site.

“What it wants is for brands to create campaigns that are ‘social by design’, rather than an afterthought, and it will reward them for that.”

Previous research carried out by TBG to determine whether the recently launched Sponsors Stories ad format was any more effective than normal ads found that campaigns using the Sponsor Stories with a social context gained a 46% higher click through rate than those that didn’t.

Mansell continued: “Facebook is obviously trying to make more money by encouraging these social ads with better rates, but it’s also beneficial to be more social because you’ll get a better click-through rate.”

To monitor the effectiveness of its ad campaigns, Facebook has worked extensively with research company Nielsen, which found that people are 68% more likely to remember seeing an ad and twice as likely to remember its message if it includes social context

One digital agency that runs ads on Facebook, Essence, said it had noticed that social ads tend to get around 10% lower cost per click than standard ads for its clients. It also said that social ads get strong click through rates and that the introduction of Sponsored Stories had seen stronger performance.

Matt Isaacs, CEO, Essence, said: “With Sponsored Stories performing particularly strongly, it has highlighted the importance of having an initial fanbase to work from when using social ads.

“The higher the initial fanbase, the more people you can reach with a more personal Sponsored Story ad, achieving higher click-through rates and lower costs per click.”

Please note the views expressed in this blog are the views of the author, Andre Brown and do not represent the view of Locayta, its employees or its shareholders. For more information about Locayta, visit www.locayta.com