What is cost per engagement (CPE)?

Cost per engagement refers to paying for interactions such as likes, shares, or comments. While used less commonly in Catalog Ads, engaging formats like carousel product ads can drive strong CPE when optimised well.

How do you calculate CPE?

To work out your CPE, you divide the overall cost of your ad campaign by the number of engagements it generated.

For example, if you spent $1,000 on an ad campaign that generated 5,000 engagements, your CPE is $0.20. 

Why is CPE important in e-commerce?

CPE is an important metric to measure when you’re running Catalog Ads as it measures true user interest, helping you to understand who’s genuinely interested in your products. Plus, as you’re paying only when users take an intentional action which signals interest in your brand or product, it can potentially deliver a higher return on investment ( ROI) as these users are more likely to convert.

It’s especially valuable when you’re running Catalog Ads which feature multiple products. CPE helps you identify which products or visuals attract the most attention, enabling you to optimise your product listings accordingly. 

Which factors can impact your CPE?

Ad quality and relevance

Catalog Ads that are visually striking tend to encourage more interactions. In addition to your visuals, your messaging can also impact CPE significantly. Emotive language that speaks directly to your audience’s pain points, needs, or interests generate more engagement, while a clear, compelling call to action (CTA) can also encourage more comments, shares, and likes. 

Ad format

Videos, carousels, and static images all perform differently in terms of engagement. Interactive formats like videos tend to boost engagement.

Best practices in measuring CPE

Segment by engagement type

Comments and shares are typically seen as more valuable than likes. As not each type of engagement carries the same weight, ensure that you segment your engagement by type to help you identify which ads generated high-value engagement.   

Analyse engagement intent

Apply qualitative analysis to understand why users engage with your ads. For example, studying the sentiment of comments can help you to improve your future ads’ creatives and messaging. After all, just because you received a lot of comments doesn’t mean your ads were received positively.    

Watch out for bot activity

One of the challenges in measuring CPE is that fake or accidental engagements can inflate numbers. This will result in a misleading performance analysis which may cause you to target low-performing or irrelevant audience segments. 

As such, what out for unusually high engagement from specific geographies which could indicate it’s coming from a data farm or outdated devices or browsers that bots typically use. 

You can also set engagement thresholds, such as only considering comments with more than 10 characters.