If you’ve been playing around with Facebook ads to promote your business, chances are that you’ve gone through a lot of frustrations. I’ve been there too.
The main roadblock to success when it comes to Facebook ads is the complexity of the system and the fact that these ads are usually not effective at the bottom of the funnel, but rather at the top of the funnel (except for retargeting ads that can be considered as being at the bottom of the funnel, but this is not the topic of that blog post).
Facebook ads do work, but they don’t work in a way that’s intuitive for us, traditional marketers. We’re used to excelling at direct response (email, adwords) but not at demand generation and brand awareness.
In this blog post, I’m going to share with you the process we’ve put together to make Facebook ads work for us.
I’ve spent over $60k to uncover these tips and learn what works and what doesn’t. Learn from my journey so you won’t have to spend money to learn, but just to grow your business!
Before we dive in: be ready to invest some time
Facebook ads are not a magic wand. You need to be ready to invest some time in the learning curve, and in the management side of it. Don’t expect to push a button and see the money pouring in like magic. I spent around 30 minutes a day creating, testing and optimizing my campaigns.
If you don’t have the time, or are not ready to invest some of it, don’t waste your money. Because it will be wasted, guaranteed.
Tip #1: Track the entire funnel
The biggest mistake people make with online advertising in general is to track the first touch points: CTR (click through rate), CPC (cost per click) and leads (conversion). Then, they obsess about tweaking their copy and visuals to increase the CTR and lower the CPC.
This is the wrong approach.
You need to track the entire funnel: down to the money generated by the campaign.
How can you do that? 2 situations:
- If you advertise for a single product sold at a single price and purchased once, the Facebook conversion pixel will give you the answer. You can easily count the number of people who purchased your product, then, do the math.
- If you advertise for multiple products, having multiple prices, or worse, like myself, for a recurring subscription, or even worse, for an offline product or service, things become much more complicated. And there’s no single, bullet proof answer for every situation. But there’s one common rule: you need to find a way to track the effectiveness of your campaign at the revenue level, no matter what. Otherwise, your’re just throwing money out of the window and praying…
Here are a couple of tips:
- For online products having different prices but one-shot purchase, Google Analytics ecommerce integration can do the job. It’s a bit complicated to implement, and you’ll probably need the help of an expert, but it works. In the example below, we are able to identify the $ amount of sales generated by 2 different Facebook ad campaigns:
- For online products with a recurring subscription, Google Analytics will not work because it only records the first transaction, not the recurring ones. But products like Kissmetrics can work. It also requires an expert to set it up for you, not marketer friendly. In the example below, Kissmetrics shows us the total revenue, including recurring ones, for the concerned period:
- For offline products, you can do 2 things: if you’re speaking to all your customers (like a service business): ask them how they heard about you and keep track of it. If you can’t talk to your customers, give them a coupon you can track at the point of sale. If you have multiple locations, run ads only for one of the locations and measure how that location is evolving in terms of revenue compared to the others.
Well, actually, these tips are great, but they have a flaw: they only capture the direct impact of a campaign, not the indirect ones. And in my experience, the indirect impacts are sometimes much greater than the direct ones. This is what we call brand awareness, word of mouth and everything that is not trackable, yet, very effective and powerful.
And I’ve learned that the hard way… Read on…
Tip #2: Find a way to check your bottom line
When I was beginning with Facebook ads, I made a mistake. I launched a big campaign in South America right before going on vacation. My idea was to let it run for 2 weeks while I was having a time off.
That campaign had a lot of blog posts, free tools, ebooks, video tutorials and other assets that were not “ads” but rather good for awareness. And I had a couple of “sales” ads on top of these awareness ads.
I launched the campaign, it was working fine, then I left. When I got back, all the awareness ads were still running, but by “sales” ads were off. They’ve been stopped by Facebook because of the 20% text rule. I was desperate, all my money had been wasted, I had no direct conversions after having spent $2,500 in 2 weeks.
That was it, no more Facebook ads for me.
4 months later, thanks to a new software we were using to track our revenues, I was able to see the evolution of our monthly revenue for South American, and that’s when I saw this:
So my awareness campaign actually had worked! It had increased my monthly recurring revenue (MRR) by $1,000 for $2,500 invested. And as the increase in revenue had remained stable afterwards, in 2.5 months, I had recovered my investment and was making profits.
I just didn’t have the tool to measure it as I didn’t have a tool to measure the evolution of my revenue for that given region.
As I wanted to be really sure it was actually the ads, and not pure luck, I did it again, and this is what happened:
I invested $3,500 for that second campaign, and my MRR increased by almost $3,000 during that period. So my payback period was close to a month. Pretty impressive results as far as I’m concerned!
And the funny part is that, according to all my other tracking systems (Facebook pixel, Google Analytics and Kissmetrics) these campaigns didn’t do well.
Bottom line: track the bottom line! And get the tools that allow you to zero in on that bottom line for any specific campaign.
The main reason is that because the effects of your campaigns will have multiple forms: word of mouth, recommendation, top of mind awareness, etc. And all these things are not trackable. And according to that experience, they can have a strong impact.
Tip #3: A/B test everything
A/B testing is key for any advertising medium. It’s even more important on Facebook. I A/B test almost everything: gender, age, interest, lookalike audiences, countries, copies, visuals.
What works in one scenario, won’t work in another, so you need to keep A/B testing all the time.
For example, the interest “Facebook for business” may work very well for me in one country, but not so well in another. I redo that A/B test for each new country I’m targeting.
To make your life easier, I definitely recommend using a tool. The one I use for that is Adespresso (http://adespresso.com/), and I love it! It allows us to see what’s working and what’s not when using multiple criteria for targeting. Here, you immediately see that the “Facebook for business” interest performs way better than the “Social Media Marketing” one, even though the cost per click is relatively similar:
I wrote an entire blog post about how A/B testing can help you save a lot of money, if you’re interested in the subject, check it out here.
Tip #4: Be careful with false positives (pixel viewed)
In the early days, I was relying entirely on Facebook pixel tracking results. We had tracking pixels for website visits, new signups and new subscriptions, it was easy to see if our Facebook ads were generating any positive results.
And they did! Some campaigns were doing really great, providing signups at a very low cost and new clients at a reasonable rate. That was it, the tracking pixel was the answer to all our ROI questions.
We invested more in the campaigns that were doing well, and stopped the ones that were not doing so well. Easy!
That was until we discovered that the tracking pixel doesn’t only track the conversion from people who have clicked on the ad, but also from people who viewed the ad. And after deep diving into our reports settings, we were able to see both. It looked like this:
As you can see, we had much more people subscribing after viewing the ad than after clicking the ad.
On paper, it sounds OK, the ad may influence people even if they don’t click on it, so it’s a conversion result worth tracking.
But the reality is different. In most cases, this number was actually a false positive.
The best example was the retargeting campaigns we were running targeting our website visitors. In particular, we were retargeting users who had viewed our pricing page.
That campaign was doing very well on the surface. But when we dug a little bit more, almost all conversions were from users who had viewed the ad, but not clicked on it.
That’s when we realized that most of these users were already on our funnel and would have converted anyway, the fact that they saw the ad had very little to do with the end result.
The takeaway for you:
Always check the conversion numbers to differentiate from “people who clicked” and “people who viewed” your ad. If they click, the end result is highly probably attributable to the ad, if they viewed, it may… or may not.
When you track conversion for any given campaign, make sure the targeted users have not already entered your conversion funnel. It doesn’t mean that retargeting users already in your conversion funnel is a bad thing, it just means that the tracking pixel results should not be relied upon.
Ideally, in your ads report, change the settings of your tracking period, 28 days is OK for people who clicked on the ad, but it’s probably too much for users who viewed the ad, 7 days is more conservative:
Tip #5: Don’t forget what Facebook ads are good for (awareness)
As stated earlier, apart from retargeting and certain custom audiences, Facebook ads are mainly effective to create awareness than to get immediate conversions.
Most of the tips and examples cited in this post are rooted in that core principle.
If you are building your Facebook ad campaign to get direct conversions in the short term, you’ll highly probably be disappointed.
Try to look at Facebook ads as a way to increase awareness for your brand, the problem you’re solving and the solutions you have to offer, not for a direct purchase.
For example, in an ideal scenario, if you are selling organic food for babies, do not create ads selling your baby food right away, write a blog post about healthy recipes for babies targeting parents, and explain why organic food is better. Then, you can retarget the readers of that blog post.
Parents will be much more likely to read an interesting piece of content that relate the health of their kids than change their purchase habits right away. And once they understand how important it is for their kids to eat healthy food, they’ll be much more likely to convert.
Your turn: what power tips have you learned doing Facebook ads? What has been your experience with them so far?