Is Meta Too Expensive?

News in brief · Advertising

Meta ads are getting dearer – so the smart money is waiting for “Q5”

Prices on Facebook and Instagram are climbing as Meta pours many billions into AI tools and development. Advertisers are responding by changing accordingly, being more picky about when they buy, and what they put in front of the emerging algorithms.

What’s happening

Meta’s own earnings reports show that its average price per advert rose by 12% year on year in both the first and second quarters of this year, namely 2026. Agencies are reporting that the cost of reaching a thousand people (the CPM) has risen across several advertising formats in recent months.

The rise comes while Meta spends at a historic scale on AI and development. It expects capital expenditure of between $130 billion and $145 billion this year alone, including new data centres in addition to consumer AI products.

Meta is defending thier poition by arguing that advertisers are getting more for their buck. Its internal analysis of more than a million campaigns found an average return of $4.13 in revenue for every dollar spent, an increase of 25% since 2022.

How buyers are responding

Buying later. Some brands are sitting out the expensive Black Friday to Christmas window, where peak prices and discount-squeezed margins make the maths marekedly painful. They are buying instead in “Q5”, the quiet stretch from late December into January, when the demand for CPMs typically fall back.

Working the creative harder. With Meta’s AI-driven tools such as Advantage+ favouring broad targeting, agencies are telling clients that “creative is the new targeting”. In practice this means more variations, more A/B testing and constant iteration. The algorithm finds the audience, but only if the ads give it plenty to work with.

What it means for you and your own smaller businesses

For an SME, a 12% price rise is not the end of the world, but it does punish lazy campaigns. Three things stand out:

• Timing matters. If your product doesn’t live or die at Christmas, January may give you more reach for the same budget.
• Creative is now the lever. Several strong, varied ads will outperform one single polished one.
• Measure return, not cost. A dearer ad that sells is cheaper than a bargain basement ad that falls on deaf ears.

Verdict: the era of cheap, set-and-forget social advertising is over. The winners will be the ones who think a lot harder about what they say and when they say it.

Source: Marketing Brew