On Facebook, 850 million people spend more than 350 minutes a month hanging out online. To some, it may be how they keep in touch with college friends, the way new moms share photos with family, or where sports fans go to cheer on their team and connect with other fans around the world. To businesses, it’s more than just a communication tool–it’s a goldmine. Businesses have the opportunity to create a Facebook Page where they can interact with their customers, provide product information, offer promotions, and gain valuable customer feedback. Facebook ads are becoming a major marketing channel for small businesses.
The user information that Facebook provides is data that businesses and marketers have dreamt about for decades. All of the information that determines a business’s demographic is being handed out on a silver platter when a Facebook account is created. Name, age, gender, geographic location, birth date, political opinion, religious view, marital status, place of work, college, college major, high school, friends, likes and interests are the advertising treasures that make the Facebook Ad’s platform unique. As business owners we are able to target campaigns to any and all of the profile characteristics that pertain to our specific target customer. This allows for more quality leads.
Facebook Ads operate using the cost per click (CPC) model, similar to Google AdWords. When running ads in Facebook you have the option to direct people to a business brand page within Facebook, or to an external website. When using ads within Facebook, you have custom opportunities that you can only take advantage of within Facebook. Opportunities include running a sponsored story, an ad for a Facebook Event, a specific post, application, contest, or video. This allows for marketing creativity and the use of an ad to coincide with a current social promotion.
There is also a major value here that a search engine can’t provide- the social reach. This is a feature that associates ads that run with users that have interacted with that brand or business on Facebook. The social reach brings us to the value of a friend’s opinion and word of mouth recommendations in 2012 purchasing. Those features are the clear picture of two marketing mediums working together for a better user experience.
Paid Ads + Social Intelligence = Smarter CPC
The above images display the social feature that Facebook incorporates into their ads and the role that a friend referral for a business plays in Facebook marketing
5 Areas to Focus on When Setting Up Facebook Ads
- User Destination: Figure out where you want to send the users that click on your ad. There is a strong benefit to sending people to a Facebook Business Page, as well as sending them to a company website. It all depends on the marketing goal you are hoping to achieve. Costs per click will also vary based on where you direct people to go. A CPC landing page can make or break an ad campaign, but the landing page doesn’t necessarily need to be offsite. Facebook Business Pages allow for creative opportunities for landing pages including a contact form or a Facebook store among other options.
- Ad Type: Determining which ad type to choose can directly impact the success of a campaign. Facebook Ads are a common ad type that is structured most similarly to traditional CPC ads. Sponsored stories, event, post, and application ads can also be successful for brands but focus on more specific content. There is a strong social advantage for running ads that highlight a brand’s status update or event because they show “likes” and shares associated with that post. These ad types often see increased click through rates because of the social association.
- Targeting: You not only have the opportunity to target your current demographic, but can also connect with an audience that you would like to target as customers. Facebook allows you to target users based on every profile feature that they enter. Likes and interests are a feature that businesses need to take advantage of. If a business sells fitness products they have the opportunity to show their ads to anyone that “likes” fitness, health, working out, yoga, etc. The specific targeting allows for leads from a very qualified user group, which makes the Facebook Ad conversion rates much higher than traditional CPC campaigns.
- Reporting: In addition to the basic reporting that Facebook offers, there are other ways to track your user’s activity after they click on your ad. You can setup goals and conversion tracking in Google Analytics that can assist in determining the success of the ad campaign.
- Optimization: Continuously managing your ad campaign is vital to its success but knowing how to optimize it is what can really drive results. Knowing which ads are performing and why is what you’ll need to know to carry that success to the other ad campaigns.
As a marketer, Facebook Ads have been a revolutionary tool for driving success for clients. The dream-like targeting capabilities set Facebook apart from all other ad platforms and deliver quality results. Unfortunately, at the current time Facebook reporting doesn’t compare to the capabilities and functions of Google AdWords. Facebook offers basic features of budgeting, bidding, and reporting with a major opportunity for improvement as ads continue to grow and be a major financial driver for Facebook in 2012.
Do you want more tips for how to use social media to grow your small business? Register today for Melinda Emerson’s webinar teaching social media, direct mail and email communications techniques March 29th 1-2pm ET http://www2.pbsmartessentials.com/how-to-better-communicate-with-your-customers
About the author:
Lindsay DeFeo is the Director of Social Marketing at Teknicks, a well known Social Media Agency in New Jersey. Lindsay utilizes her education and experience in both marketing and design to provide valued services 
to Teknicks’ clients. After working across several interactive enhancement marketing channels, Lindsay quickly saw the value for businesses in social and has built the Teknicks Social Marketing department from the ground up. She now manages a hard working and innovative team, working with many of Teknicks clients to improve their social presence online. Connect with her on Twitter at @Teknicks.
Great article and tips! It seems that many who have advertised on Facebook have had better results when they lead visitors to their own FB page because visitors did not have to leave the site and it’s easier to get a simple action such as “liking” their page. I do think that when you do a good job of targeting your audience you’ll see really good conversions.
Rhonda–
Thank you for your comment. I’ve had success with both approaches, so I think is should be driven by the goals of the campaign.
To your business success,
Melinda
Great tips. It’s also helpful to experiment with different wording/images to see which ones are more effective, especially when you’re first starting out. Don’t be afraid to try different combinations and then track the results against your goals.
Targeting allows you to get very specific–even identifying those who’ve recently relocated. Pretty cool stuff.
Shawn–
Thank you for being such a great supporter of this blog. I think you are exactly right to suggest testing messages before spending too much on PPC ads.
To your business success,
Melinda
Came across your blog – this is a great summary. We have been levaraging some advanced analytic and ad management by using things like day parting etc.
You can actually reduce the cost by quite a bit in terms of Cost per like
Thx
Rajat