You do not have to be an advertising expert to run ads on Facebook. You can use Facebook’s self-service tools to create and run ad campaigns and track their performance and Facebook advertising cost with easy-to-read reports. But maximizing your ROI, your return on investment, may require some professional assistance.
What are Facebook ads and why do I need them?
Facebook ads appear in individual Facebook feeds. You write the advertisement, you choose the kinds of people who should see it, but Facebook displays your ad to the people who are most likely to click on your link and buy your product.
Importantly for your business, Facebook knows the kinds of content that motivate their members to click on a link so they can display your advertising to the people who are most likely to respond to it.
You get to set limits on where, to whom, and how your ads are displayed. If you do groundhog control in Punxsutawney, Pennsylvania, you don’t want to spend money showing ads to potential customers in Hawaii. If you run a travel agency, you don’t want a lot of your ads to show in the feeds of Facebook users who mostly comment on cooking shows. If you sell skateboards, you probably don’t want to market to people born before 1937.
Facebook helps you reach the customers you can keep happy who will earn you the most profits. And Facebook advertising still works.
It’s true that Facebook has been involved in a few highly publicized controversies over the past few years. But the average user spends an hour a day on Facebook. The average advertiser gets about a 1-percent click-through rate on Facebook. That means that 1 percent of the people who see your ad will click on your link. (The click-through rate ranges from about 0.5 percent for loans and financial services to 1 percent for gyms and fitness trainers to 1.6 percent for lawyers.) Then about 10 percent of the people who click on your link, on average, will buy your product, sign up for your service, or download your information. Your cost of customer acquisition should be about 10 times the cost of a click — if you craft your ads to take advantage of Facebook’s inherent marketing advantages.
What kinds of ads can you run on Facebook?
Social media managers talk about Facebook ad objectives, such as awareness, consideration, and conversions. They talk about Facebook ad formats, such as photos, videos, slide shows, carousels, lead form ads, and dynamic product ads. But the best way to think about the kinds of ads you can run on Facebook is in terms of Facebook’s unique tools for each step of customer engagement.
Facebook designed its platform to match advertisers to customers at precise points in the sales funnel. Facebook can identify potential customers who are open to knowing more about your product. It can identify potential customers who are in a research and discovery loop, learning more only to have more questions about products like yours. It can identify potential customers who are ready to purchase. And it can identify people who have already bought a product like yours and who are considering what they want to do next time.
How are Instagram ads related to Facebook ads?
It is a snap to integrate your Facebook ad campaign with your Instagram ad campaign. All you have to do is to check a box on Ads Manager or Power Editor. You will get more conversions on a smaller budget when you run ads on both platforms. Of course, many of the same principles of good advertising apply to both Facebook and Instagram. You are just working with different audiences.
Just remember that all your ads need to fit in Facebook’s sales funnel. Do not know how to do that? Do not worry. Affordable, professional social media help is not hard to find. We will have a recommendation at the end of this article. What you do not want to do is to post an ad without having some idea of who is going to be responding to it and why.
How much does it cost to run a Facebook ad campaign?
Have you ever run a campaign on Google AdWords? AdWords is a great platform for reaching exactly the people who are primed to convert to your product. The problem with AdWords is that it has a competitive bidding system for where your ad will display. Getting your ad at the top of the first page can cost you $50 to $100 a click.
If you are a lawyer seeking to represent people who have been injured when they were run over by armored trucks carrying bales of cash, that very high-priced click might work just fine for you. But it is easy to get priced out of the running on AdWords. Your competitors know this.
Facebook ads have terrific reach and can cost less per click. So, how much does it cost to run an ad campaign on Facebook? The honest answer is “It depends.”
- The cost of your Facebook ad depends on how much you are willing to spend to engage a customer. In other words, the cost of your Facebook ad depends on how much you are willing to spend per click. You can set a maximum amount you are willing to pay Facebook so they display your ad instead of some other ad (not necessarily your competitor’s ad) that fits the profile of the Facebook member at the exact moment they are looking on their feed. But if you are not willing to spend $0.97 per click, the average cost-per-click for Facebook advertising, you will not get a lot of imprints and you will not get a lot of clicks.
- You get to set the total amount you will spend on your Facebook campaign and how fast you will spend it. But if you set your total budget too low, there will be a lot customers you miss. And let us be optimistic, if you have great conversion rates, you need to be able to provide all the items you are advertising.
How can I tell if I am getting an ROI on my Facebook ads spend?
Dividing the total amount, you spend on your Facebook campaign by the number of new customers it brings you give you your ROI, your return on investment. But your ROI is not immediately obvious for ads you place to increase brand awareness and to persuade people who use your competitors’ products to switch to you the next time they are ready to convert.
Tough times call for smart advertising. BizIQ has helped over 20,000 small businesses tackle their challenges head on with successful Facebook ad campaigns and smart local advertising. Contact us online to explore what BizIQ can do for you or call us at (888) 416-9800.
