With more than 2.8 billion active users every month, Facebook is currently the largest social media platform in the world. When you’re running any type of business, you should take steps to reach as many potential customers as you can. Facebook offers its own advertising platform that provides businesses with the opportunity to place ads directly on Facebook. If you take the right approach with your Facebook advertising strategy, you have the potential to obtain a high number of new users as well as a large amount of traffic to your website.
The primary reason to use the Facebook Ads platform is that taking a targeted ad approach is simple and straightforward. Facebook makes it easy to target a specific segment of users with the message that you believe will be the most effective. When you want to get started with Facebook Ads, all you need to do is create a Facebook business page if you don’t already have one. From here, head to the “Business Manager” or “Facebook Ads Manager” area to create your first Facebook ad campaign.
Creating a campaign with Facebook Ads is also relatively straightforward but has a large number of options for you to select from. You can craft a highly targeted campaign that’s designed to reach a small subset of users if you want to. Whether you’re currently looking to grow your business or have just formed a company, there are many benefits that come with using ads for your company.
For one, you’ll be able to reach a wide range of people who may predominantly use social media platforms when browsing the internet. The platform also provides businesses with comprehensive analytics, which means that you’ll be able to measure the performance and effectiveness of your ad campaigns. It’s possible to micro-target a specific audience with Facebook Ads. Keep in mind that B2B businesses can also benefit from advertising on Facebook. This article offers some insightful tips and suggestions on how to optimize your marketing strategy when placing ads on Facebook.
The Importance of a Facebook Ad Strategy
Creating a Facebook ad strategy is highly important for any business that wants to reach customers who primarily use social media when on the internet. Facebook is considered by many to be among the best advertising platforms available to companies because of its extensive targeting capabilities, the ability to scale to a substantially larger audience, and tools that make it easy to reach potential customers on a frequent basis.
When you start using Facebook Ads for your marketing campaign, you’ll quickly notice that there isn’t a one-size-fits-all strategy that you’re required to use if you want your campaign to be successful. In fact, there are many methods you can use to get the most out of Facebook Ads. If the main product you’re trying to sell is listed at $25, the marketing strategy you implement should be considerably different than the one you would use when selling a $20,000 product. For instance, the advertising strategy for a car dealership should differ from the strategy that a home furnishings company uses.
Facebook Ads offers the tools needed to create all types of marketing campaigns that are geared towards different subsets of users. Even though other ad platforms offer beneficial features and tools that you can use to grow your company, the main advantage associated with the Facebook platform is that you will instantly gain access to billions of users. As such, there’s a good chance that most of your customer base is on Facebook, which gives you a great opportunity to advertise to your target audience even when they aren’t browsing your website.
The type of Facebook ad strategy that you use depends on how much competition you currently have on platforms like Facebook and Instagram. Your level of competition is important because Facebook advertising is designed to be interruption-based advertising, which means that you need to stand out when compared to the competition. Your ability to stand out depends on how much competition you have. The tactics that work for high-competition businesses don’t necessarily produce the same results when performed by low-competition businesses.
Find Your Average Customer
While you’re creating a Facebook advertising strategy, it’s important that you identify your average customer, which allows you to obtain the average customer value. Many businesses primarily focus on producing creative ads that they believe will immediately appeal to their core audience. Even though this method can prove to be effective, it’s still highly recommended that you take your average customer value into account, which refers to how much customers are worth.
When you have a relatively high average customer value, this means that you can spend more money to acquire customers because you know that these customers will eventually spend an ample sum of money when purchasing products or services from your brand. Keep in mind that this strategy can also depend on the volume of customers that you currently have. In the event that your company has a low average customer value, it’s important that you obtain a high volume of customers to offset this issue. On the other hand, companies with a high average customer value don’t necessarily need to acquire a high number of new customers.
While it’s possible to measure the initial customer value or lifetime customer value, the results from these measurements aren’t as actionable when you’re trying to optimize your Facebook advertising strategy. The number of money customers spends when they first purchase products from you could be significantly higher than the amount of return business you receive from them, which is why it’s recommended that you calculate the average customer value over a 12-month period.
Before making these calculations, keep in mind that there are numerous pieces of software that simplify this calculation, one of which you can find and download on HubSpot. Let’s say that you know the average customer spends $40 every time they shop at your business.
You should then try to identify how often the average customer shops at your store. If the average customer does business with you once per month, you would multiply 40×12 to obtain the average customer value over a 12-month period. Make sure that you differentiate revenues from profits when making your calculations.
Determine the Amount of Competition You Have
Your next step should be to identify how much competition you have, which allows you to determine what kind of strategy you should use on the Facebook Ads platform. When you’re advertising a service or product that can only be delivered locally to nearby cities and towns, this means that you will automatically have significantly lower competition when compared to businesses that deliver internationally.
Try to determine how many businesses your customers can choose if they want a similar product/service and decide not to shop with you. You should then do some research to identify how many of these companies are placing ads on Facebook. If you have high competition in the real world, it’s possible that only a small selection of these businesses advertise on Facebook, which means that you would technically have low competition on Facebook.
The size of the city or area you operate out of can also dictate what advertising strategy you use and how much competition you have. A restaurant operating out of New York City will invariably have more competition than a restaurant in Buffalo, NY. Once you’ve identified your competition, you can use a tool called Facebook Ad Library to research competitor names, which will allow you to ascertain whether or not your competition is advertising on Facebook.
Check Out which Facebook Ad Tool is Best for Your Business
The exact tool or strategy you use when creating a marketing campaign on Facebook depends on the amount of competition you have and the current average customer value that you’ve calculated. Let’s say that your business has low customer value and low competition. In this situation, your ads won’t need to stand out from the rest since you won’t be competing with many other businesses. You should also avoid spending too much money on Facebook Ads because the customers you acquire won’t spend a substantial sum of money.
With low competition and low customer value, a high customer volume is most important. You should focus on cultivating high levels of interest among prospective customers by delivering fantastic customer service and by providing customers with what they want from your company. When you provide customers with a good experience, they are much more likely to recommend your business and brand to their friends. In this specific situation, you might want to use the brunt of your marketing budget in the first 3-6 months following your initial ads. After this period of time, you’ll likely reach some level of market saturation.
There are technically four strategies you can use when advertising on Facebook, which is differentiated by customer value and competition. These strategies include:
- High customer value/high competition
- High customer value/low competition
- Low customer value/high competition
- Low customer value/low competition
The amount of budget you decide to spend on Facebook Ads depends on the strategy you’re using. For a high customer value and low competition strategy, your spending can be high. However, you don’t need to spend as much to acquire customers as a result of the low competition.
Concluding Thoughts on Facebook Advertising
The Facebook Ads platform is a highly advantageous way to gain new customers, grow your brand, and expand your reach. Since billions of people use Facebook every month, you can be confident that a targeted ad campaign will at least reach the intended audience. In general, advertising is more important than ever in today’s world. Even if your brand or business fills a specific niche, there’s a good chance that you’ll have at least some competition to contend with.
More companies are taking an online-focused approach to do business as well, which may result in a higher percentage of your competition advertising their brands on Facebook and similar websites. However, you can stand out among the rest by delivering creative ads that are targeted to your main audience. The analytics tools available through the Facebook Ads platform will help you assess your campaign’s performance, which allows for quick optimization.
Whether you advertise on Facebook or similar platforms, marketing is highly important if you want to create more brand awareness. Even if you offer a compelling product/service and great customer service, your customer base could remain small if you don’t expand your awareness through advertising.