Facebook Ads: Will They Help Grow My Product-Based Business?
The short answer is Yes. Facebook ads, when used correctly will help you grow your product-based business and I have seen huge success from facebook ads in my own ecommerce business and in many of my clients. However...
...for many of you, just the phrase "Facebook Ads", may make you scream and run a mile simply because of all the horror stories you've heard from other entrepreneurs - about how they've spent buckets of cash on this method and got nothing to show for it...
We Want To See Return On Investment Before We Scale
Regardless of whether you’re just starting your product-based business business or looking to expand your current operations, it stands to reason that your advertising spend has to reach the intended audience. We want to see a return on our marketing investment and progress towards your strategic growth plan.
So we are naturally apprehensive of trying anything new if we are not sure if it will work for us.
Well the simple truth is, like ANY advertising method, Facebook Ads 100% CAN work for you and your business - but here's the important part - the campaign has to be set up correctly, it has to be well thought through and your product offer must be compelling and something customers actually want.
Plus, we have to test the ad, test it and test it again. It will take iterations of ads before we find a winning ad.
And that's where most entreprenuers get it wrong.
The Mistakes Most People Make With Facebook Ads
Many entrepreneurs in the push for glory and growth, rush the strategy, the research and testing part of the advertising process - they just plough ahead and shove any old ad up onto the platform and hope for the best, with no strategy behind it, no market research and little thought to the offer above something thoroughly dull like "here's 15% off".
Facebook Ads can be a great way of ensuring that online advertising spend used is being seen by the right audience, it can be a terrific and highly specific targeting tool - but to get the very best results, it’s important to know how Facebook Ads really work.
That takes time and education which you have to be willing to work at if you want results for your product-based business.
Let's take a look at an overview of Facebook Ads together to get you started:
What are Facebook Ads?
Facebook Ads are online adverts that can lead to a webpage, a landing page or dedicated social network. Some ads may be used to increase viewership and engagement / interaction on a page, whereas others may simply be used to generate traffic volumes to a webpage. It depends on your goal.
As well as being shown on Facebook, these Ads can also appear social networks and messenger services connected to Facebook, such as WhatsApp and Instagram.
What Ad Types Are There?
Image Ads: These ad types are great for beginners and easy to implement as past posts can be boosted. This allows your product-based business to see more traffic and increase your brand recognition.
Video Ads: Video ads are often running in News Feed and Stories and are a great way of showing your product in action. A must for any product based business.
Video Poll Ads: A new addition to Facebook that has shown to be an effective way of promoting brand awareness thanks to it's interactive component.
Carousel Ads: If you’re looking to promote several products at once, or showcase your brand imagery then the Carousel Ads are a great way of doing this. Those looking to stand out can even create one large panoramic image. A carousel is ideal to present a product range beautifully or present a collection of products which are meant to be used together.
Slideshow Ads: Slideshow ads are where short videos are created using still photographs and videos. Not only are they easy to create but will even show in newsfeeds where there isn’t much of a signal due to low bandwidth requirements.
Collection Ads: These ads can only be viewed on mobile devices and allow an online business to showcase five products from its product range.
Instant Experience Ads: Those becoming more experienced with Facebook Ads can take advantage of the full-screen format of instant experience ads.
Lead Ads: Those looking to generate leads and book appointments for their product-based business will find that Lead Ads are a great way of obtaining customer information without the customer having to input a lot of information.
Dynamic Ads: These types of ads are ideal for online businesses that are looking to bridge the gap between an abandoned purchase and a profit, as it will promote targeted products. It will use pixel/cookie data to happily re target products your customer has previously viewed on your website, drawing them back in for a second look (and hopefully a purchase!)
Facebook Messenger Ads: As the name suggests, ads placed via Messenger will be presented to users within the 1.3 billion people that use Facebook Messenger each month. A growing platform to experiment on.
Stories Ads: These ads run in the Stories tab on Instagram and offer a great way for businesses to promote a product or brand awareness, as the advertising used ensures that the view doesn’t have to turn their phone to view the advertising.
Stories Augmented Reality Ads: Augmented Reality Ads are another new addition to Facebook that are slowly being rolled out. AR ads offer more immersion via the use of filters and animation. AR will play a huge part in future product-based businesses marketing strategy so get ahead of the game and experiment with these ads now.
Playable Ads: Playable Ads are popular among game developers, as they allow those viewing the ad to play a part of a game without having to download the app.
Deciding Where To Run The Ad
To get the best from Facebook Ads, it’s essential to know what the goal of your advertising campaign is. So before deciding where to run your ad, first create a clear goal, and a clear message that’s transparent with potential customers.
What are you trying to advertise and why? What do you want from the advert in terms of results? What do you want your customer to do, think or feel when they see your ad?
Once you have a clear goal in sight, you can then work out where (which location) to place your ad that is best for your specific brand.
For example, those luxury positioned product-based businesses using beautiful branded imagery are usually wanting to raise brand awareness and engagement in the first instance - they will find Instagram ads can offer a lot of benefits as your ad reaches this platforms image loving customer base.
Using facebook ads to successfully grow your business will depend alot on how well you define your audience and how carefully you match the goal of your campaign to your overall ad set up and testing approach.
Knowing How Much To Spend On A Facebook Ad
Although some people may just run an ad to test the water, and throw a simple dollar per day budget at it - this, in my view is not the way to go. We want to be much more strategic than this if we are going to use facebook ads to grow your business.
How much to spend depends on several factors, the campaign type, the goal of your business and your overall marketing budget, specifically as it relates to customer acquisition.
Not only do you need to plan your campaign and set your goals, create a budget for the campaign and decide what success for you would look like. How many clicks? How many sales? - you also need to understand EXACTLY how much you want to pay to acquire your customer.
Customer Lifetime Value
What is that customer worth to you in dollars? What would you happily pay to buy one new customer and get them onto your email list?
THESE are the essential questions which until you can answer properly, you shouldn't be using Facebook ads to scale your business in my view.
Customer lifetime value is a term used to represent the total sales a customer will generate for a business throughout their relationship with you.
For example, your typical customer for your product based business spends say $25 on average per order (AOV) and may shop 4 times a year with you.
Over the lifetime of their relationship with your business, they may stay loyal to your brand say on average for 2 years.
From this information you can start to see that your customer is worth $25 AOV x 4 times = $100 per year. Over 2 years = $200 in sales.
When we then look at profitability of those $200 of sales over the lifetime of the customer, we can start to understand the unique amount of profit investment we would be willing to make to acquire that customer (and their future $200!).
We are essentially buying future cashflows for you business... and this is where growing your business using Facebook ads gets interesting. If you can acquire your specific customer, at a cost per click which keeps you in a healthy profit across the lifetime of that customer, then you are onto a winner. You just need to "feed the beast" and put more investment into those Facebook ads.
But you can ONLY do that when you are really, really, really sure of your underlying data for your product-based business.
Spend Will Also Depend On What Type Of Ad You Want
It is also likely that a lot more of your investment will be needed for ads looking for an immediate sales conversion as opposed to an ad that’s simply being used to obtain page likes or website traffic.
Those starting with Facebook advertising for the first time will find that even the smallest investment will yield a reaction for you to review, if you choose the right type of ad. So it can be a good idea to start small, start with a basic traffic ad and test your ad and then stop. Look at the data - what's worked about this ad type, what didn't?
Compare it's results to other ad copy you've run. Compare it to ads with different images and compare it's results to conversion type ads you've run. This is all part of the testing. Is there a clear winning ad? Decide which campaign types and ad types and audiences work for your unique product-based business, which get you the very best cost per click result - and then and ONLY then, scale up accordingly.
Ensuring Facebook Advertising Is A Success
Although advertising on Facebook will get attention, it’s important to track the performance of ads and then optimise them accordingly. For example, some businesses may choose to run two different types of an ad to see which performs better, and then make changes accordingly. Daily and proactive management of your ad data and peformance results is essential.
And don't just leave your ads running without setting limits to the campaign and your overall Ad account, otherwise you might have a nasty shock when Facebook has spent all your money!
It’s also important to check that the ads are leading to the right destination. There’s nothing worse than having paid for advertising on Facebook, only to find that potential customers have been forwarded to the wrong URL or wrong destination.
Major Steps Of Setting Up A Facebook Ad
As you can see, many variables need to be considered when setting up a Facebook ad, from who the audience is that you want to target, through to what you want that audience to do once they've seen your ad (the call to action).
Although the platform can take some getting used to when placing an ad for the first time, there is plenty of guidance available about setting up the ad, and adhering to the following steps ensures that you’ll soon be fluent in the placement of Facebook ads.
- Select the Objective of the Campaign
- Name the Campaign
- Decide on Your Demographic / Audience
- Decide Where to Place the Ad (Facebook Feed, Instagram Stories etc.)
- Decide on the Campaign Budget
- Let Your Facebook Ad Go Live
Where Can I Find Out More?
Despite how straightforward the setting up of a Facebook ad can be, if you are creating an ad campaign for the first time you will be keen to get more information.
There are also alot of Facebook "compliance" issues that first time advertisers can come up against, as they try to publish an ad that meet advertising standards. This is particularly true if your product based business is in the weight loss, nutritional or adult categories. Naturally these categories need an element of governance and control over who can see, experience and interact with these types of product adverts.
Visit the Facebook dedicated portal that offers tips and support when placing your first ad on Facebook.
Make It Happen In Your Business
There can be a lot to learn when dealing with Facebooks ads for the first time, but many business owners find that once they’re familiar with the platform, and they've invested time and money into a genuine testing process, that they start to discover what works for them and start to see a return.
This does take time and skill though, so have patience and if in any doubt seek a professional agency to guide you through the initial set up.
- Consider if Facebook Ads may work for you and what your specific advertising goals would be if you invested into this as an advertising method.
- Research using Facebook Ads Library to see how your competitors are currently using Facebook ads and whats working for them (and whats not).
- Set a clear budget for advertising spend before you start and get crystal clear on your own unique customer lifetime value. These are different for every single business, so don't assume, do the work and calculate it.
- Embrace a testing approach - accept that you are very unlikely to hit a winning ad on your first try! Acknowledge and plan to test, test and test again until you start to hone in on ads that work for your unique product based business.
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