Wednesday, August 17, 2011

Facebook Advertising Tips For Brilliant Marketers

10 Facebook Advertising Tips For Brilliant Marketers
Posted by Nick O'Neill

Your current Facebook ads don’t suck, it’s just that they could be better. When spending money on Facebook advertising, you must monitor your ad spend closely, as the expense can skyrocket and suddenly kill your campaign’s effectiveness. Too many Facebook advertisers are making beginner mistakes that end up making Facebook rich and the marketer broke.

Stop making those mistakes! Use these tips below and dramatically increase your Facebook advertising skills.

Split Test Your Ads
One of the most important things for any advertiser to do is to ensure that the advertisements you are running are the best that they can be. Too often advertisers/marketers will launch a Facebook ad campaign and see that they just spent $100 and got little results and generalize that this must be the case for all campaigns on Facebook. The reality is that your ad campaign probably wasn’t performing well because your ad wasn’t great. The best marketers know that performance comes from testing things out.

In the image below there are two sample ads. In this case we are testing against two interest groups: those that like tuna fish and those who enjoy base jumping. I would guess that base jumpers tend to be more passionate and as such they are more likely to respond to an advertisement. I haven’t actually run these ads so I don’t know. However you should test numerous variations. Switch one component of your advertisement at a time and then compare it to another and see which works better.

There are a limited number of variables that you can change, but here are the four primary groups that you should be testing ads against:

•Ad copy – What does the text of your advertisement say? Asking the user to click “Like” below tends to work relatively well.
•Ad image – Test different images to see which ones perform the best. You can get extremely granular and test images within various demographic groups. You may find things such as that pink images work better for females.
•Interest groups – Another thing you should be testing is which interest groups are more passionate (and hence more likely to click). It’s frequently too expensive to target less passionate and less responsive markets as they click on ads much less frequently.
•Demographics within interest groups – Once you find a passionate group, try splitting the ads by gender or age group. You may find that some groups perform better than others. Narrowing this down will help you increase your ads performance and reduce the effective cost per click and cost per action.

Create A Click Through Rate Threshold
While some ads will perform better than others, the last thing you want to do is throw money away at under-performing advertisements. As such, you should develop a click through rate threshold that is acceptable for your campaign. In the image below, we were testing a campaign to drive more fans to a page. Our target was to generate new fans at less than $0.25 per fan. Unfortunately, this advertisement generated 3 fans at a minimum and 21 at a maximum (if all of the clicks to our page converted into fans).

This means our effective cost per fan would have been between $0.65 and $4.60, most likely further toward the high end. The result is that this advertisement was killed for under-performance. We probably let this ad run too long, ultimately hurting our overall campaign performance, however this happens to be a long-term campaign, so the $13.80 we spent on this ad probably won’t end up damaging things too much. The main lesson here is to figure out what sort of click-through rate is acceptable to you and immediately kill those ads which are performing up to your standards.

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Use CPM To Test Your Ads
The bottom line is this: CPC (cost per click) is for lazy marketers. Cost per click drives you to perform all of your tests on the landing page (or landing tab of your Facebook Page). This is not the way to do things. Test your ads on a CPM (cost per thousand impressions) basis and find those which drive the lowest CPC. You may end up finding that you’ll get lower CPCs than you would have had you used a CPC bidding model. Using a CPM model will enable you to find which ads perform the best and potentially provide you with the greatest opportunity to minimize the cost of your campaign.

While Facebook previously stated that they were going to position CPC ads in those spots which get the most clicks, we’ve run a number of CPM-based campaigns which perform insanely well. Using CPM you can determine what the real CPC rate should be (based on performance) and you can test which ads perform the best. If you want to let your ad campaigns run on their own without monitoring them, you can switch to CPC, but at least you’ll have discovered which advertisements perform the best.

Monitor Your Campaigns Closely
One thing that you’ll notice when you first begin running advertising campaigns on Facebook is that the performance will degrade over time. That’s because the cost of reaching each subsequent user on Facebook increases incrementally. In other words, the first people who click on an ad tend to be the most responsive to advertisements in general. Once you get through this first wave of people, the cost of reaching the next group will increase.

As such, you need to monitor your daily CTR. Watch how your click-through rate performs over time. If you begin to see decreases, you may want to consider either targeting a different target group or switching your advertisement. At a certain point, all advertisements lose their effectiveness. Not monitoring your ad campaigns on a regular basis is for lazy people and those who want to spend more on their ad campaigns.

Test Performance At Different Times
Oftentimes you’ll find that an advertisement will perform better at a different time of day. While Facebook doesn’t let advertisers/marketers select which time of day their ads run, you can turn your ads on and off manually and see which times perform the best. This requires extremely close monitoring, however. While Facebook may eventually (and will most likely) ad this type of granular control in the future, no advertiser has control of this right now. If you are spending large amounts on advertising, you may want to test a third-part Facebook advertising partner who will be able to automate the time of day your ads are displayed.

Use A Cost Per Fan Model
I’m personally a huge fan of run advertising campaigns on a cost per fan model. This is because Facebook provides Page administrators with a great re-engagement channel: the feed. While email is often one of the best marketing channels, Facebook performs well because quality content gets re-shared by users. That means increasing your fan base increases the likelihood that your content will “go viral” on Facebook. While many email marketing companies, such as MailChimp, are looking at way to make email marketing more social, Facebook Page continue to be one of the best marketing channels.

As such, investing in Facebook advertising on a cost per fan basis is smart because once you get a fan, you can reengage them in the feed. When running cost per fan campaigns, we’ve found that running ads on a CPM basis and optimizing ads on “Cost per action” basis is the best model.

How To Calculate Cost Per Fan
Let’s say that you’ve decided to run an advertising campaign as we’ve described. In order to calculate the cost per fan, run campaigns on a CPM basis. Once you run them, you will see a report like the one pictured below. In order to calculate the cost per fan, simply divide the total campaign amount by the number of “actions” (which is the people who clicked on “Like” in your ad). This will be your estimated cost per fan. The reality is that the people who clicked on the ad (under the column “Clicks”) may have also eventually become a fan, however determining that requires using third party tools or creating your own custom software (which most people don’t want to do).

Even by using the estimated cost per fan model, you should be able to drive fans to a Facebook page for not too much. As you see above, we were able to drive fans at an estimated cost of $0.05 per fan, a rate most people would kill for!

Develop A Creative Reveal Tab
As I mentioned in the last tip, tracking how well those “Clicks” convert to fans is a little more complex. However you should be doing as much as you can to increase the conversion of those clicks into actual fans. One of the best techniques for accomplishing this is by adding a reveal tab. As we previously described, a reveal tab is a simple tool to drive users to click on “Like” to become a fan by rewarding them for their action. The image below depicts a sample reveal tab which promises the “latest breaking terrifying news”, which in all honesty isn’t that big of a promise.

If you wanted to take things one step further you would offer them a free product that they can download as a way to convince the user to click “Like”. We’ll cover this more in depth in a future article.

Bid High To Get Ads Approved Faster
I’m not sure that this is a trick that Facebook wants to be made public, however all frequent Facebook advertisers know that by bidding more, Facebook will respond to your ad submission quicker. Simply put, you can change your bid rate after your advertisements has been approved. However if it’s taking a long time for your ads to get approved, you are losing time that could have been used testing ads. Keep in mind that this trick doesn’t work forever though.

Facebook has a system which prioritizes advertisers based on how much they are spending on a regular basis. If it turns out that you are bidding $1.00 CPMs but always switch it back to $0.03, Facebook will catch on. In other words, don’t use this trick for too long. This is simply an effective technique for new advertisers in the system.

Use Facebook’s Conversion Tracking Tools
While I know I’ve been pushing the cost per fan advertising model on this site for a while, the reality is that not all advertisers/marketers are interested in driving fans. Instead, they’d prefer to drive actions on their own website. Fortunately for those individuals, Facebook has their own tracking tools (which can be found here. While Facebook is still testing this system, it’s an effective technique for determining how well your ads are performing, including how much revenue is being generated from each ad.

Using these tools you can determine if the ads you are running are generating a profit or are instead making you bleed money slowly. Facebook has provided advertisers with the following tracking guide to help them get started. If you aren’t looking to run a cost per fan campaign, then this is probably a tool you should be testing out immediately.

Remember The “Passion Factor”
One thing that many advertisers and marketers frequently don’t consider is that some groups are simply more passionate than others. Base jumpers are probably much more passionate about their recreational activity than basket weavers (although I don’t want to discriminate against my fellow basket weavers). The main thing is this: passionate fans click on ads more often. Your job as the advertiser is to invoke an emotional response to your advertisement and one of the best ways to do this is to target passionate individuals and expose that passion through your ad.

I’ve seen so many boring ads on Facebook, but you don’t need to be one of those individuals who creates the boring ads! Figure out what will generate an emotional response and target those individuals who are most passionate about their interests. Find which interest groups are the most passionate. The more passion, the cheaper your advertising cost.

Use these Facebook advertising tips and you will surely boost the effectiveness of your advertising campaigns. While you can go out and purchase fans directly from companies, the reality is that Facebook’s advertising platform is the single best source of attracting new fans. No matter the size of your Facebook advertising budget, these tips will save you precious dollars which could otherwise be thrown away on low performing ads. If there’s one thing you should take away from this article, this is it: don’t throw your money away at low performing ads, run tests to find the best performing ones. In upcoming articles we will be highlighting additional advertising techniques which will help boost your Facebook advertising campaign performance.