Facebook Advertising – Is It Really Worth It?
It seems like everyone is spending a crazy amount of time on these newfangled social media sites. In fact, nearly 1 in every 5 minutes spent online is spent using social media. That is a lot of time and it is only going to increase. So what does that mean for you? Well, Facebook has implemented a very advanced advertising system that is just begging for you to take advantage of it.
Social Media Examiner breaks down Facebook’s ad system which has three sales channels: Direct, Inside and Online.
- Direct sales deals with the largest global brands, for which Facebook has dedicated account teams to manage the relationship directly with the advertiser and their agencies. These are generally referred to as managed accounts.
- Inside sales handles the next tier of clients, who may be spending in the hundreds of thousands of dollars per year on Facebook. These clients will have a sales rep whom they deal with directly to buy advertising, but they don’t have quite the same level of strategic support as managed accounts.
- Online channel. There are companies developing products on top of Facebook’s Marketing/Ads APIs to facilitate the buying process for self-serve advertisers.
If you’re willing to shell out the big bucks for advertising on Facebook, it is best to contact them directly. Otherwise head over to the Facebook ad page and get started!
Facebook makes it easy to target a specific audience. Oh, you’re interested in selling to males, ages 16-18, who live in Boston and play World of Warcraft? Well you can – with just a click of a button. The Facebook advertising platform offers the ability to target your ad to specific segments such as Location, Age, Sex, Relationship Status, Interests and more. This leads to more bang for your buck, because you are not wasting your marketing efforts on users not in your target audience.
According to comScore, after seeing an ad on Facebook from a major offline US-based retailer, fans and their friends bought 56% more frequently online from this retailer. 70% of brand campaigns also showed a return on ad spend of 3x or better. But, that information comes from a study done in conjunction with Facebook, so take those numbers with a grain of salt.
So how effective are Facebook ads? Recently released reports suggest that the ROI on Facebook ads are not as effective as advertisers expect them to be. A recent study found that less than 1 in 20 users returns to a brand page within 30 days of having ‘liked’ it. According to a new poll from the Associated Press and CNBC, nearly 60% of Facebook users don’t click on ads or sponsored content.
General Motors, the 7th largest advertiser in the US, also pulled their paid advertising from Facebook because GM executives felt that Facebook ads had little effect on consumers’ car purchases. Sources said that Facebook doesn’t provide consistent, clear-cut metrics that prove advertising on their sites works. GM wasn’t feeling the results so they pulled ads – which has caused quite a stir amongst advertisers.
Another example shows Ajith Prasad Edassery, founder of Dollar Shower, who spent $27.51 on Facebook ads and saw the following results: 1.27million impressions, 303 clicks, and zero sales. So, while a large audience saw his ad, very few clicked it and not one user purchased anything. However, that does not mean that Facebook ads are ineffective. Adam Dion of Synergy Beads has seen a substantial increase in sales through Facebook ads. Every $50 of Facebook ads brings him between $220 and $250 of revenue per month.
Facebook is a platform built around socializing with friends and sharing information, not shopping. There is something to be said for the ineffectiveness of traditional ads on Facebook. If you’re looking to run ads on Facebook, your best bet is to drive visitors to your Facebook page and earn customers from there. In reality, 45.7% of advertisers use Facebook ads to build awareness and brand sentiment, not generate leads.
The effectiveness of Facebook ads will vary from case to case. It is best to try out the ad platform with a few different variation of ads and take it forward from there. See which one makes sense for your business. Finding your sweet spot with ads will help drive more fans to your Facebook page and more fans to your services. Just make sure to keep an eye on your results to make sure you’re getting the most from your money.