Transcript - Facebook Marketing Success Summit Ads Presentation 2011

TRANSCRIPT

Facebook
Success Summit 2011

Succeeding with
Facebook Advertising

INSTRUCTOR:
CHRIS TREADAWAY

Sponsored by

Copyright 2011, Social Media Examiner

Transcript

Introduction

This session is titled "Succeeding with Facebook Advertising," with Chris
Treadaway.

Chris is co-author of Facebook Marketing: An Hour A Day. He founded
Notice Technologies, an advertising company for media companies, and
is managing director for Ultrastart, a social media consulting company.

In today's session, Chris will show you how to succeed with Facebook
advertising campaigns.

Presentation

Thank you very much for having me and thank you all for being here
today.

Poll Question: How Much Experience Do You Have with Facebook Ads?

I thought we'd start out with a quick poll: how much experience do you
have with Facebook Ads?

• A lot
• A little
• None

This is just so I can have an idea of all the people out there and what you
know about Facebook Ads so we can spend time on the things we need to
spend time on.

We have a lot of ground to cover today, so why don't we take a look at
that poll right now?

There we go. "A little" and "None" take the day.

Session Transcript SocialMediaExaminer.com Page 2 of 33

Agenda

Thanks again everybody for being here. Just a quick agenda, we'll go
through:

• Introduction
• The business case for Facebook Ads
• Facebook Ads basics
• Some of the weaknesses of Facebook Ads
• Some specifics on how to drive success and run campaigns
• Things that we've learned in our business
• Q&A

About

First, a little bit of context. I'm the founder and CEO of a company called
Notice Technologies.

Previously, I was at Microsoft for three and a half years, where my last job
there was being responsible for web strategy for the company, which was
a very, very interesting role in the early, early days of Facebook. Just to
give you all an idea, Facebook had about 25 million users as opposed to
800 million+ now. They had 25 million users when I took that role at
Microsoft.

This is my third start-up, and I got an MBA from the University of Texas
in 2004.

Company

We run a company that does a few different things. Probably the most
interesting for this conversation is our managed Facebook Advertising
business called Social Media Buy, where we run campaigns for small and
medium businesses and for bigger companies as well.


A lot of what we're going to share with you today is based on our
experiences of running hundreds and hundreds of campaigns for
different companies of all different types. Almost all of those campaigns
have been run on Facebook, so you're going to get the shortcut into the
collective wisdom that we've gathered over the years in running these
campaigns going back to 2009.

Co-Author

I co-authored Facebook Marketing: An Hour A Day with this lovely lady,
Mari Smith, in 2010.

We're actually working on the second edition of the book now that should
be released sometime in the spring of next year. So we're pretty excited
about that.

Contributor/Technical Editor

In addition, I've been a technical editor and occasional contributor to two
books:

• Facebook Marketing: Leverage Social Media to Grow Your Business –
that was actually the first Facebook marketing book that was released
in the marketplace in, I think, 2008.

• Killer Facebook Ads by Marty Weintraub, which was released just a few
months ago. I can tell you, guys, it's really a spectacular, spectacular
book. I have nothing but great things to say about it. Marty really
captured a lot of the ins and outs in a lot more detail than what I'll go
through today.

So if there's one recommendation to take away from all this, it's that
Marty's book is really, I think, a wonderful, wonderful work and a great
companion, and something that people that want to dive into
Facebook advertising themselves really should take advantage of and
purchase because it's really fantastic book that covers all the ins and
outs of running campaigns.


What We Know About Facebook...

First, let's cover what we know about Facebook at a high level here.

Facebook Owns the Social Audience

First of all, we'll set the stage here for what we know about Facebook
relative to other properties.

According to Citigroup, Facebook owns what's approaching about 20%
market share in terms of web activity in the world. It's an unbelievable
number.

As you can in the chart, in particular dating back from 2007 when it had
little less than 2% share going all the way up to the present day, Facebook
is really continuing to grow and thrive and do really, really well. So
despite what skeptics and cynics may say, Facebook really does own the
social audience.

Facebook Ad Growth Is Unreal

Ad growth is really unbelievable.

The data points here on the left side of the screen were some of the
numbers that I shared with those of you who were on the call last year.
The estimates, according to AllFacebook, were that Facebook did about
$600 million in ads, and that for 2010, they were supposed to have done
$1.28 billion in revenue.

But what actually happened – and I thought this was really pretty
interesting from eMarketer – you'll see that in 2009, they actually did
$740 million instead of $600 million. And in 2010, they did $1.86 billion,
not $1.28 billion.

So they've done fantastically well with advertising as the core business
model of Facebook. Roughly 88% to 91% of Facebook's revenue comes
from advertising.


It's pretty phenomenal. As you can see, the growth projections for 2012
and 2013 make Facebook just a massive, massive player in the ad
business, which is something that people didn't necessarily foresee
maybe even as little as three years ago.

Facebook Dominates Social Media

In terms of the amount of time spent on social media, this from Nielsen,
"State of the Media: Social Media Report 2011," Facebook owns a
dominant majority of time spent across the major Internet properties:
Facebook, Google, YouTube, Blogger, Tumblr, Twitter.

I thought it was interesting they didn't include the Microsoft properties in
this chart because they might have a little bit of a presence in this chart.
But the point to make here is that Facebook is unbelievably strong in
terms of the amount of time people are spending.

One thing we know from every type of media that exists out there is that
where people spend their time, ad dollars follow. Fortunately, I think, for
those of us that are still working in advertising and working in social
media, there is still plenty of opportunities for us to take advantage of
advertising on Facebook.

The Business Case for Facebook Ads

Let's run through a few pretty quick reasons why I think Facebook
Advertising makes a lot of sense:

• First of all, it's accessible to anyone that has $1 a day or more in terms
of budget. It doesn't take very much money if you're going to run your
own Facebook ads to actually try it out.

It does take money to optimize and do well with Facebook Ads, but
you can actually get your foot in the door for not very much money.

• It's the richest demographic targeting opportunity that currently exists
in the world for advertising when you consider that Facebook has 800
million+ profiles that it can read from. It can pull the demographic


data out of the profiles that people have made available on Facebook
and make that available to advertisers as groups of people that you
can advertise to.

• The combinations and permutations of targeting are really
unbelievable and still relatively inexpensive.

If you target an audience of about 100,000 people or more and you're
doing the self-serve advertising yourself, you can get the clicks for
about $1.50 to $2 apiece, which ends up being a lot cheaper in most
cases than Google click-throughs.

And you can get the impressions for a CPM at about 25 to $0.30
apiece or less. So you can do really well.

It does get more expensive as you do more aggressive targeting, but
this is roughly what you can expect to spend if you end up running the
campaigns yourself. I think that compares pretty well to other options
that an advertiser may have.

Social Advertising Alternatives

If you think about Google, LinkedIn, and Twitter as other social media
advertising alternatives, they have some limitations that Facebook does
not have.

Google, for example, has been around for a really long time, and so a lot
of the click-throughs are very, very expensive. It's not uncommon to hear
of clicks costing $5, $7, $10 apiece.

LinkedIn has done a much better job, I think, over the last year improving
their ads offering. But even so, compared to what you spend on
Facebook, it's actually pretty expensive.

Then if you look at Twitter, Twitter's advertising is more or less
sponsored tweets at the moment. There are few advertising options. But
Twitter as a platform is much simpler and doesn't capture all the
demographic data that Facebook does, and so Twitter cannot in turn


make that available to advertisers as easily as Facebook can and does
already.

Old Media Alternatives

Then think about for a moment old media alternatives. Let's say you're
not going to go the social media route – you're going to go the old media
route: billboards, radio, television, yellow pages, etc.

In almost all these cases, they're more expensive than what you can get
from Facebook just from a CPM perspective. In a lot of these cases, you
can't track what actually happens, or you're relying on third parties to tell
you how effective the advertising was or what demographic groups you
may have reached.

There are just a lot of ways that I think Facebook is truly a disruptive sort
of technology where an advertiser gets a lot more value and a lot better
value for less money. So I think that it makes a lot of sense for a lot of
advertisers in a lot of areas. And I think some companies are beginning to
figure that out now.

How Facebook Ads Work...

Let's go through quickly how Facebook Ads work for those of you that are
relatively new. I think about 19% have no experience with Facebook Ads,
so let's just go through the basics pretty quickly here.

What Is a Facebook Ad?

A Facebook ad is typically what shows up on the right-hand side of the
screen as you log in to Facebook and as you experience it in different
places inside Facebook. It's that area there inside the red box.

Basic Facebook Ad Specs

In terms of the ad specifications, because Facebook is trying to make
everything sort of fit into this space here, Facebook is actually pretty
restrictive about what you can put into the title, the size of the image, the


body, what you can say inside the body. And all of it is contained inside a
120 X 240 pixels box that's on the right-hand side of the screen.

In that tight real estate that's sitting alongside the news feed on the left
or whatever it is that you're looking at inside Facebook, that's the
opportunity that you have as a advertiser to get someone's attention.

There's limited space and you have to economize and do a really good
job of using what's given to you. But in so doing, you can make a lot of
things happen that way.

Where Ads Appear

These ads appear inside:

• Profile pages you may be scanning
• Facebook pages (business)
• Games and applications pages (you may be playing a game down the
left-hand side and the ads show up to the right of that)
• News feed page that I showed you two slides ago. But that's a
sponsored position managed by Facebook. It's a higher CPM and it's
not available through self-serve advertising at the moment.

You may notice one other thing too. Inside the games, those ads will
actually refresh after a certain period of time. You might be playing a
game and you might notice an ad down the right-hand side. If you don't
click it, if you wait for a minute or two, those ads on the right-hand side
may actually refresh.

So one thing as a marketer we have to think about is if somebody is
experiencing these ads inside of game, they may actually go away. They
don't just sit on the screen for as long as somebody is playing Mafia Wars
or Mafia Wars 2 or any of the social games that have gotten popular over
the years.

What You Can Promote


With Facebook Ads, you can promote:

• Websites
• Facebook Pages
• Facebook Places
• Facebook Events
• Facebook Apps & Tabs

You can promote a lot of different types of things, and it's really sort of
up to the marketer's imagination in terms of what you want to actually
get people to do. When they read an ad, do you want them to go to a
website? Do you want them to like a Facebook page or attend an event
that is being promoted on Facebook, and so on and so forth?

You can promote a lot of different things. A majority of them are things
that you can do inside Facebook, but you can also promote really
anything with a distinct URL on the Internet.

Types of Facebook Ads

There are two primary high-level types of Facebook Ads.

There's self-serve, so that's what you access when you click "Ads" on the
left-hand side of the screen when you first log in to Facebook.

For that little as $1 a day budget, you can get impression-based
advertising or CPM advertising, or you can get clicks. Those are the two
options that you have right now. These things are highly, highly
configurable.

The sponsored advertising, the bigger budgets, the large ad buys, these
are things, as I mentioned before, that show up on the news feed, and
the minimum budget is about $5,000 a month, with a $5 to $7 CPM. So
you end up spending a lot more money on sponsored ads than you spend
on self-serve ads.

But I think what Facebook has recognized is that that ad inventory – that
space available in the upper right-hand side of the screen on the news


feed, which is what users see when they first log in – is really premium
space. People might log in to their news feed and then not even come
back to Facebook for the rest of the day or not use any of the other
features inside Facebook, so Facebook has really put a premium on that
real estate on the news feed.

It is administered by Facebook Ad sales directly, so you actually have to
talk to an Ad sales rep and deal with them to get that. One of the plus
sides of this is that if you go this route and you have that kind of ad
budget, you can get them to give you the reports and work with you on
creating your campaign.

But at a $5 to $7 CPM compared to a $0.25 to $0.30 CPM if you did it
yourself, or a little more if you used a maintenance service, it's a big, big
difference in terms of how much inventory you get, how many ad
impressions you get for your money.

The sponsored ads tend to be used a lot more by brands and bigger
companies, whereas the self-serve ads tend to be used a little more by
smaller companies.

Types of Self-Serve Ads

There are two types of self-serve ads. Inside that, there are several types
of ads that you can choose from, and there is some nuance, I think, in the
different types of opportunities that are available.

• Facebook Ads

For Facebook Ads – and this is all serviced inside the self-serve interface
– you can run what's called a Facebook Ad, which is just a typical type of
demographic targeting of people who like a page or whom you want to
reach with a particular offer. Let's say you want to hit a particular
demographic group and send them to a website or send them to a
landing page. You would do that using a Facebook Ad.


You may, though, instead want to run some ads that people will see like a
Page Post Ad or a Facebook Ads for Pages that will end up promoting a
page as opposed to a URL.

So these are ways that you get people to pay attention to Facebook
pages, and these are ways to attract more fans to a Facebook page.

• Sponsored Stories

The Sponsored Stories are a little bit different. This is something that
Facebook actually made available, I guess, about a year or maybe nine
months ago where people can get help distributing content from a page,
place, or application.

For those of you that are familiar with EdgeRank or have seen some other
presentations at this summit about EdgeRank, EdgeRank filters out a lot
of content that people might actually be interested in seeing. What
Facebook has done is sort of taken that dynamic of EdgeRank filtering
out certain pieces of content and has given marketers an opportunity to
actually make that content more visible and kind of circumvent problems
they may have with EdgeRank where content isn't necessarily showing up
regularly.

So these are the kinds of ads that you would run where in that sponsored
section in the upper right-hand side of the screen, as opposed to seeing
a sponsored ad, you might see a sponsored story – the friends of
someone that liked a page, they might see that their friend liked a
particular page. That's a tactic that we use pretty regularly to get the fan
count increased for properties that we work with that are interested in
increasing their fan count.

The Check-in Story will allow people to promote when Facebook users
check in to a place.

And then the Page Post Like Stories are going to be ads that demonstrate
that people liked a page post that was made by a brand on Facebook.


There's some nuance in all that. It can be a little bit confusing, but you
actually have different types of ads to handle different types of situations
that you may run into as a marketer on Facebook.

How to Buy

In terms of buying these ads, you can set a lifetime budget or a monthly
budget, so it's very configurable in that respect.

You can run for an ongoing period of time, or you can set a stop date for
your campaign. That's particularly handy if you want to run something
for, say, two weeks and then look at the outcomes and see what
happened.

You can also create your own ad copy and upload your own ad imagery.
The key to running good Facebook ads is making sure that you have an
attractive or interesting title, interesting ads, and interesting imagery that
can draw someone's eye over to the right side of the screen because
that's something you'll definitely want to do.

The approval process can take a little time, and sometimes if it's over a
weekend, perhaps it might take a little longer than a few hours to get
approval for your ad. Sometimes you'll actually get your ad disapproved
because you violated the ad guidelines that Facebook provides that are
designed to make the ads appealing, interesting, and not fraudulent.

You go through a purchase process as you're creating your targeting
criteria, and that helps you set up your advertising campaign.

Targeting Options

There are a wide variety of targeting options that are useful to you and
that are available to you inside Facebook:

• Geography
• Demographics (age, gender)
• Education level
• Interests


• Workplaces
• Sexual orientation
• Relationship status
• Languages
• College attended
• Birthday

All of this, or a vast, vast majority of this outside of geography, comes
from user-submitted data. You're relying on the users to generate
reliable profile data, which has not so far been a problem for Facebook.

The geography, though, sometimes will use a combination of what the
user says and IP addresses to determine where the user actually is.

It's been creepy for me, for instance, when I've traveled, been in another
city, and gotten an ad served to me on Facebook for that city. It's like,
"How did they figure that out?" Facebook is using IP addresses in some
cases to help figure out where users are.

Things You CAN'T Target

Now, for all the things you can do on Facebook for targeting:

• You can't target people who attended "some college" at some time or
have "some education." When we've run some ad campaigns for people
in secondary schools and community colleges and so on and so forth,
they've wanted to do that. You can target people that are in college or
in high school, or college graduates, but not necessarily people that
have "some college" experience.

• You cannot target people based on race or ethnicity. That's just
something that you have to find other ways to reach people in those
target markets.

• You cannot target specific high schools.

• We recommend the vast majority of people that come to us wanting
zip code targeting to hold off just because Facebook did introduce it a


little while ago, but it's not really functional in a lot of zip codes. We
know of a lot of zip codes that have 40,000-50,000 people in them,
but according to Facebook, they might only have 300 if you're trying
to target that zip code.

The zip code targeting is getting better, but it's not necessarily
reliable for all zip codes yet, so we just tell people to proceed
cautiously with zip codes.

• Then you can't target people that just don't enter certain types of
profile information into Facebook. There are hidden demographics of
people that just fill out one or two of the necessary lines of
demographic information about themselves and maybe don't fill out
age or don't fill out birthday, for instance.

I think a lot of people rush to want to do the demographic targeting,
but they don't realize that they're leaving out a vast majority of people
that are not necessarily filling out every piece of profile information
that they could fill out.

The targeting is useful for people that do opt in and do tell you what
they're interested in, what their birth date is, and so on and so forth,
but it's not exhaustive, and it doesn't apply to all Facebook users. So if
you rely strictly just on targeting, you might be missing a vast majority
of people in your target market.

What You Can Do with Facebook Ads...

Shifting gears for a moment, in terms of business outcomes where we've
seen the most success for people is in a few areas.

Drive Successful Business Outcomes

For instance, there's direct incremental revenue. In some cases, you can
do a really good job to drive customers and drive leads to businesses by
spending a certain amount of money on advertising and having them get
more in return.


It doesn't always work, but in some cases it does. You just have to kind of
try that out, but that's a potential business outcome that can work with
Facebook Ads.

Building customer lists and finding leads, we've done a really good job
with those types of things. Where people are looking for email addresses
or people are looking for customers for a particular product, it's a really
good way to do that and reach your target market effectively.

It's good for testing hypotheses. This is something I don't have in the
slides, but a lot of people that I know with a new business idea or new
product concept will actually run targeted Facebook ads at particular
demographic groups to do research just to find out if there is a big
market for their product or service.

Then, of course, you can kick off a viral marketing campaign by pointing
people in the direction of a video or pointing people in the direction of an
interesting or funny piece of content.

Those are some of the things where we think it works pretty well.

Lower Your Costs

There's another element to all this as well in terms of lowering costs for a
business.

Customer acquisition cost can be really high for certain types of
businesses, but when you can run Facebook ads at a $0.40 CMP or a
$0.45 CPM, it can be a lot more effective than, say, that 4X4
advertisement in a newspaper.

In terms of cost per touch or cost per engagement, we can reduce costs
for that. We've seen that happen.

Also, in the customer service arena, a lot of businesses we're seeing,
especially bigger companies, are moving to online and social media
support models. You have airlines listening, and you have people like Dell
that are listening to every piece of social media feedback that they may


get. You can address problems with messaging or customer service
issues proactively by just listening to what's happening and responding
directly to customers as things progress.

There are ways to make more money and save more money by using
Facebook Ads and Facebook ad campaigns to reach your customers more
effectively.

How? Iterate.

How do you go about doing this? Well, one piece of advice I would give to
people that are looking to succeed with Facebook Ads is to set up an
iterative process to help learn what happens by putting marketing
messages and so on in front of customers.

There's a process that we adhere to really in every Facebook advertising
campaign that we run for ourselves or for other people where we:

• Create ad copy
• Run ads for a week or maybe 14 days
• Look at what's happened and assess what's happened
• Retire underperforming ads, imagery, messaging, and things that just
don't seem to be working
• Keep the ones that have gone well and put together new iterations
based on the things that we've learned

This cycle is very repetitive and can be a little boring for people that don't
love process. But the numbers – it's really about iterating on the
outcomes of what's happening and then using the numbers to inform you
as to what you should do next.

Basics of Iteration – The A/B Test

One of the basics of iteration is called the A/B test.


This is just a really simple example here. You're trying to test differences
in ad performance based on a single variable, keeping everything else
alike. In this particular case, you see these two arrows pointing to a
hamburger and pointing to a logo for sunshine. We've kept everything
else the same. "Eat at Joe's!" is the same. We actually have ad copy
underneath that's the same.

All we're trying to do is say, "What works better – a picture of an ad with a
hamburger or a picture of an ad with sunshine?" That's our A/B test:
hamburger versus sunshine.

Then we'll do these things at a higher level. We'll run women in one group
and men in another group. For instance, in this particular example, there
will be four different ads that we'll run:

• Women with the hamburger
• Women with the sunshine
• Men with the hamburger
• Men with the sunshine

We'll just watch those ads run for two weeks, see what happens, and then
check the outcomes.

A/B Test Tale of the Tape

In this particular case, we tried to run the same CPM bid, we tried to run
the same amount of budget, and we tried to run the same impression
count. We're trying to keep as many things as similar as possible.

But an A/B test is really about changing one variable and having two
examples of that that we can actually test to see what happens.

In this particular case, we actually got far more clicks on the sunshine
from women and far more clicks on the hamburger from men, and our
effective cost per click for this campaign was actually really good in those
two instances.


So we would retire the women/hamburger ad, and we would probably
retire the men/sunshine ad and continue a better data optimized for the
best click results that we can get.

That's really what we're after with all of this – to just run numbers, keep
things the same, and make sure that we can tell based on the numbers
what's succeeding and what's not succeeding.

Iteration Makes You Smarter

The process of doing these kinds of things repeatedly for your campaigns
will help make you a lot smarter.

That was a pretty simplistic example. For a lot of campaigns, we may be
running 10 A/B tests simultaneously. For bigger customers, we may be
running 20-30 permutations of ad copy, imagery, and title text just to
see what combinations do best for advertisers that we work with.

It's a best practice that we highly recommend for everyone who has the
time to do it.

Time Trending Analysis

The other thing that is important to all of this in succeeding with
Facebook Ads is the time trending analysis.
How can we tell over time how a series of ads or a campaign may do? We
do this because we know for a fact that ads and ad campaigns fatigue
over time.

Let's say you have a target market of 200,000 people. If you run five
impressions at them, a vast majority of those people may not have
noticed your advertisement. If you run 50 impressions at them, you can
probably conclude that a lot of people have seen the ad and have either
chosen to click it or have been uninterested in it.

As you have a higher number of impressions per person, you start to see
apathy either because people ignore the ad, or maybe people have
already acted upon the ad and they've already become a customer, so


running new ads at them is not actually going to matter – it's not going to
give you a new customer.

We always track how things are performing over time just to make sure
we can tell how things are performing, how things are fatiguing, and if we
need to make some changes to ad copy, imagery, or targeting criteria to
reach new customers.

A Real-life Example

I'll give you guys a real-life example. This is something we've done quite
a bit. We actually run ads to see how the click-through rates start to
change over time.

We did some ad tweaks, we got the ads improved to these levels here,
and then we started seeing the numbers fall off here at Week 7. It peaks
here at Week 6 in terms of the click-through rate, the click-through rate
being the percentage of time people will click something based on the
number of impressions that they see.

We look pretty aggressively for click-through rate changes and cost-per-
fan changes where we see a peak here in Week 6, and then we can begin
to project as the numbers get a little worse that the ads are starting to
underperform. We're really obsessive over watching things sometimes by
day, sometimes by week, sometimes by month – it really depends on
what the advertiser is interested in.

We're watching very, very closely to see how the ads perform, how the
ads succeed in sales, and over time how they fatigue, and determine
when we need to make some changes.

Time trending data, taking the time to actually record what's happening
week by week, will give us a really good sense as to what's happening –
should we retire things, should we continue, or should we move on?

Facebook Advertising Gotchas...


We have about 10 minutes left, so we'll get into some "gotchas" and we'll
get into some things that we've learned from Facebook Ad campaigns,
and then I'll take questions here for about 15 minutes or so.

In terms of the gotchas, I've talked about all the different things that I
think make sense about Facebook Advertising. But there are some
weaknesses to it as well, and I think these are important things to
consider as you get into a Facebook Ad campaign.

1. First of all, a vast majority of the Facebook targeting criteria are
determined by user-submitted data. If the user doesn't submit data,
Facebook doesn't know to target that user. You may still have a Boston
Red Sox fan, but if they don't say so in their Facebook profile, then
you're reliant on other things that they've entered in their profile for
you to actually reach that customer.

2. The demographic targeting does not imply purchase intent. It's a little
different than Google, for instance, with AdWords. One of the things
about AdWords that we've discovered is that if somebody enters a
search term, they're pretty likely to have some sort of purchase intent
or interest intent. Whereas demographic targeting, if you say, "I'm
from Boston, Massachusetts," it doesn't necessarily mean you're a Red
Sox fan. You'd probably be in the minority, but it doesn't necessarily
mean that. So there are some things about the demographic targeting
that don't necessarily equate to purchase intent.

For instance, we had a campaign where we were trying to target
engaged women who would be ordering a wedding cake and would be
purchasing wedding planning services. It was actually a pretty small
demographic target because even in a town of a million people, if
you're targeting women between the age of, say, 30 and 35 who are
engaged, you're down to maybe a thousand people in that target
demographic who have entered that data into Facebook and who are
available to you as a marketer.

One thing that was really interesting about that particular campaign
was that the advertiser insisted on running ads at that individual
demographic. But we were missing the moms and the fathers and the


friends of the bride, all the other people who actually had influence
over the purchasing decision in some way.

The demographic targeting options, as great as they are inside
Facebook, there are some gaps in terms of if you hold to it strictly,
you're going to miss some of the people that might have a direct
influence over a purchase decision.

So you have to think, I think, a little expansively. One of the things
that we've seen is that if people think expansively about their target
market and creatively about their target market, they tend to do a lot
better than people that are strict about hitting a very, very small
micro-targeted audience. A really big key to all this is that the
targeting is great, but you shouldn't necessarily rely on it alone to
drive decisions in your campaign.

3. Facebook has some pretty finicky ad copy regulations. If you misspell
a word accidentally, it probably won't get through Facebook ad
approval. If you capitalize words unnecessarily or use unnecessary
punctuation, it will probably not get through ad approval.

So you just have to manage these things and find out as you go. If you
submit a few pieces of ad copy that don't get through, you might be a
day or two late in submitting an ad, so you have to watch out for the
ad copy regulations.

4. Advertisers still cannot target a user's status updates inside Facebook,
although I'm convinced this will change. But as of now, you cannot do
that, so that may be better for ultimately doing some sort of purchase
intent targeting down the road.

5. There's no mobile advertising or targeting available, still.

6. Ads don't appear in mobile iPad versions as of yet. We think that will
change. It hasn't changed yet, so you can't actually target mobile users
inside Facebook yet.


7. It does require significant work to manage, administer, and optimize
ad campaigns.

8. Deep A/B testing is a very manual process. Every little individual ad
that you run, let's say in that example where there's a hamburger and
sunshine, you would actually have to submit that ad twice to Facebook
and get them both approved individually.

So if you're trying to do male versus female, age demographic
targeting, interest targeting, and trying to run different types of ad
copy and pictures, as you can tell, all those permutations would get
way out of hand very, very quickly. All of that is a very manual process
using Facebook Ads tool today.

9. Facebook doesn't offer a lot of help or assistance with landing pages
or conversions, so if you're businesses and you're interested in
converting customers or selling and doing e-commerce and all that,
you have to go through third-party systems to take advantage of
those things.

10. There are questions on Facebook Ads regarding effectiveness and
direct and immediate return on investment just because it's not quite
as transactional, I think, as Google AdWords. I think a lot of people are
making a lot of sense of it and taking advantage of it and doing a
good job with it, but there's no sort of ROI calculator built in to the
Facebook Ads interface as of yet.

Things We've Learned

Let's wrap up with a few things that we've learned as a business that has
managed hundreds and hundreds and hundreds of Facebook Ad
campaigns, if not thousands, for different customers along the way.

Best Practices

I put this presentation together for all of you to take away as something
you could download and use as a resource if you do dive into Facebook
Advertising yourself.


These best practices are pretty consistent:

 Make ads interesting to the target market. Do not be boring, do not be
dull, and do not be afraid to be funny, humorous, or even a little bit
controversial. I would say for those of you that are consultants that are
out there working with customers and clients, obviously be very, very
careful.

 Make the ads actionable for the target market.

 The demographic targeting I was telling you about before to be
cautious about that. Don't just rely on the demographic targeting
because as great as it is, you're missing the influencers that will not
fall into the same demographic groups.

 Make sure there's a call to action. That's a critical, critical component
here. We've seen it happen far too many times that someone will see
an ad, but it won't get clicks because it doesn't actually have a call to
action. There's nothing compelling about the ad that makes someone
want to take the next step.

 Eye-catching images are really important. As more things happen
inside games, and as more things happen in the news feed, people's
eyes are sort of trained to go left on the screen and not right towards
the ads. Eye-catching imagery will help you drive up your click-
through rates and performance of Facebook Ads, no question about it.

 We recommend at least 10 ad impressions per person in the target
market before drawing conclusions. I actually typically run ad
campaigns with 30-40 impressions per person before I really feel like
those things begin to fatigue. We're putting together more and more
data as time goes on just to try to measure: when does fatigue take
place? That's, at least in the beginning, how those numbers are
beginning to shake out.

Rules of Thumb


The more local and the more targeted you get, the more expensive the
ads get. So just be careful with that because you can have expensive
Facebook ads if you get too obsessive about targeting.

We typically recommend at least a target market segment of 10,000
people. That tends to work well. When you get less than that, results start
to get pretty unpredictable and not necessarily statistically valid.

Experimentation and measurement, those are really the two keys if you're
doing these things on your own.

Success Criteria

Finally, in terms of success criteria, good offers, eye-catching imagery,
good demographic fit, good call to action, good landing page – those
things throughout the entire cycle tend to work really well with Facebook
ads.

Bad scenarios are when you're guessing or when your target market is
really difficult to reach and you haven't quite found the equation. Those
scenarios are tough.

If you have a bad landing page or unclear ad copy, or if you're asking
somebody to make a really expensive purchase that they're not
necessarily ready to make and you're tracking conversions on the end,
those things can be really tough for Facebook Ad users. For people who
are responding to those ads, it can be really tough for those people to
make that leap. So you just have to proceed cautiously in those kinds of
scenarios.

Tools Necessary for Big A/B Tests

I don't know if any of you have used AdParlor, but it's a great tool for
auto-submitting campaigns of different A/B criteria.

I'm a big fan of AdParlor. You pay a little bit extra – up to about 10% in
addition to what you pay for Facebook Ads – to optimize those things
using a tool like AdParlor.


But for people that have bigger ad spends, it can be a tool that will save
you a lot of time and give you a lot of insight for not a lot of incremental
money.

I'm a big, big fan of AdParlor. There are a few other providers of that
service out there, but that's just the one that we've worked well with. I
think Social Ads Tool is a European one that works really well that I've
looked at. There are several out there that will help automate the process
of submitting individual ads for the sake of running A/B tests and
multivariate tests.

Spreadsheets Critical to Analyze Data

Then we put all the data that we get for these different campaigns into
very, very detailed spreadsheets that have rows and rows and columns
and columns.

This is just a snapshot of some things that are going on right now. We're
tracking weekly cost per click and weekly impression cost and what we
promised to different customers along the way. We use Excel to really
help us automate watching the health of campaigns more so than
Facebook's own tools. That way, we can cut the data, we can take a look
at how things are performing, and we can make changes that we see fit.

Don't Overestimate Targeting

Then in terms of the over-targeting, I'll give you a final point here about
that.

We actually have not seen the effective cost per clicks drop significantly
for targeted ads, so for most of the people that we deal with who have
done highly targeted Facebook Ad campaigns, we've not seen the click-
through cost do significantly better.

Then in terms of actual conversions, we haven't seen that do much better
either.


So I think it just sort of lends more credence to the concept that there are
a lot of influencers around a person that are just as valuable in terms of
targeting as going directly to that market segment yourself. So just be
careful with overestimating the value of Facebook targeting.

I've blown through a ton of stuff. I hope you have some questions
because we've got some time for it. Thank you again for being here, and
I'd love to hear any questions or comments you guys have.

Chris Treadaway
• Social Media Buy www.socialmediabuy.com

Questions and Answers

Mike Stelzner: Hey, Chris, great job. Thank you so much.

I've got two quick questions. First of all, what's your
take on using Facebook Ads to grow your fan page
base? Is there more value for bringing fans in via ads
versus organic growth? I'm just curious what your
take is on this.

Chris: We've helped folks with and without ads for that.
There are new Facebook Ad options – I forget what
they're calling them because they change the names
on these things it seems all the time. But there's a
type of Facebook ad that I covered in one of the
earlier slides about trying to reach friends of people
who have liked a particular property.

Think for a moment about a property that a mom
might be interested in. Take Chef Boyardee, for
instance, which is a ConAgra property. They have a
community site called Club Mum that they've done a
really good job of marketing.

One of the things that might make sense for them is
to run the ads where friends of people who have


"liked" that property would just see a little Sponsored
Story in the upper right-hand corner saying, "Hey,
Julie likes Chef Boyardee Club Mum." That's a really
easy way to pop something into the view of a friend
who may very well be a mom if you consider moms
probably are friends with a lot of other moms.

I'm a really big proponent of that. We had a
campaign that we ran for a major publication
recently around its professional sports team. We ran
that kind of ad, and we ran it compared to just a
regular Facebook ad where we were promoting a
page. And that ad performed about 330% better.

That's a new ad type that Facebook has made
available. It's highly targeted, and friends of people
that like that particular sports team may not have
liked the property, and so we help bring those two
things together using that ad type. So I'm a big fan
of using Facebook Ads to drive up fan count.

I don't know if those of you who pay attention or
read a lot of the tech and social blogs saw Gary Vee's
comments the other day about social ROI being "a
marathon, not a sprint." If you think that Facebook
pages are here to stay and you can acquire fans for a
few bucks apiece, do you think the lifetime value of a
fan is more than, say, three or four dollars?

For most people that I deal with who think in terms
of lifetime value, they think that fans may be worth
$30, $40, or $50 apiece or more, depending on the
type of company they're in. So if you can go and
acquire those fans today at a few bucks apiece
running optimized ad campaigns, that could be a
really inexpensive way for you to get your foot in the
door on Facebook.


Mike Stelzner: Video ads, can they happen or no?

Chris: They can. It's been more, though, through the
Facebook Ads sales force than actually doing those
things yourself. Now, you can technically promote a
YouTube URL in a Facebook Ad.

Mike Stelzner: That will display the video in the ad?

Chris: No, it will just send people to that destination. If you
want a video inside, you have to deal with Facebook
directly.

Participant: Actually, I'm glad that Mike mentioned something
about video ads. If you have video ads, that's
something that you have to do inside Facebook?
Huggies, I don't know how they did it, but they're
running an ad here in Puerto Rico, and they're the
only ones I've seen that actually have a clickable
video. You click on it, and it pops up on your
Facebook wall and you can actually see this video ad
that they're promoting.

I said, "I can't believe we already have video ads,"
and I went back to the back part of Facebook where
you configure ads, and there's nowhere that you can
configure a video ad.

Chris: Right, you can't do that self-serve. That's something
in all likelihood – and I'm speculating here – but
Huggies probably had a big ad buy. They probably
threw Facebook a pretty big check and Facebook
surfaced some video ads for them.

Participant: I believe this probably depends on how big the
budget is you can spend, but do you recommend
CPM or CPC? I run all my ads cost per click for now.
Do you have a preference?


Chris: It's a very common question and it's really going to
depend situation by situation. We've run some really
effective impression-based ads just because we've
seen the ad copy was right, the targeting was right,
and the demographic group was right.

I'll give you a prime example. There was a group that
was marketing clinical trials on acne medication for
teens. Think about that kind of thing. It's an
embarrassing problem for some teens. They might
not want to deal with people directly or in person
about the issue, but if they can fill out a form and
get contacted, show up somewhere, and participate,
it might be a really good way to handle that.

We ran an impression-based campaign for that. It
had an extraordinarily high click-through rate and
we're basically generating sign-ups for this group at
something like $1 apiece in a local market. It was an
unbelievable campaign. But it was because
everything fit.

Then there are other times where it doesn't look like
it'll be a good fit from an impression perspective.
Those are cases where we end up opting for clicks.

Participant: Can you target people who "like" a page or a group
that you are not the admin of, and if yes, how do you
do that?

Chris: It's "Interests" inside the self-serve interface, so
that's pretty much how you would go about doing
that. It kind of works. It's another one of those
things – I hate to say this, but a lot of these things
are really on a case-by-case basis.


There are a few tricks and things that I shared with
you guys today, but in a lot of cases as well, you
have to run these things, see what happens, and
then adjust. It's experimentation you've got to get
familiar with and comfortable with and get your
colleagues comfortable with it if you're in a
corporate purchasing situation or something like
that because you're not going to go into it knowing
all the answers. We typically don't, but we know how
to adjust rapidly, and that's where we tend to come
in.

Participant: If you are unable to target a zip code, what are the
geography parameters: city, state, and region?

Chris: You can go city, state, region of the country. You can
go nation by nation. This zip code, Facebook
released it and I think there were kind of two things
going on there.

First of all, there are a lot of people not revealing
their address, and that's kind of necessary for zip
code targeting.

There's a zip code here in Austin, Texas, so we know
there are about 50,000 people living in it, but if we
try to target it, Facebook says there are 300 people
in that zip code. It's just unbelievable. It's just flat
out wrong and we know it.

But it's in all likelihood because the address is not
entered and the IP targeting is not good enough to
know within a block of where you are. So that's why
we say, "Zip code targeting – hey, great concept. We
would love to be able to do it," but it's not really real
yet. It's close and it will get there, but for now, we
tend to talk people off a ledge when they insist on
zip code targeting. It's not because we don't want to


provide it – it's just that we don't want to disappoint
them.

Participant: How do you know how many times you've hit the
target audience? Where's the stat found?

Chris: In your ad reports, you will see "Frequency," the
number of times that you've hit each individual
person in the target demographic on average. That's
an average number, so you're not going to have a
chart with: "I hit this person three times and this
person 100." You won't have something like that.
You'll have a rolled up number – it's called Frequency
– and it's in the ad report on Facebook. It'll give you
a sense of the number of times that you've hit them.

We tend to go to about a max of 45-50 impressions
per person to really make sure we've hit them with
the message, and then we change ad copy to make
some changes. But that's really about the max that
we typically go.

Participant: Can you talk a little more about the Facebook
bidding system? Specifically, do you recommend
matching the bid price and then adjusting the price
as the bid lowers?

Chris: I think you can spend some time doing that. I haven't
seen a lot of value in making regular changes to the
bidding. Facebook will only charge you basically up
to what that spot is worth or those places on the
right-hand side are worth.

It's not like Google AdWords where you get a lot of
value out of moving your cost per click up and down.
It's a little different than that, and it's certainly
different than Overture used to be where you could
actually see the top five ad bids for cost per click.


Facebook sort of manages all of that themselves
behind the scenes.

You might be able to save a few pennies on CPM or a
few pennies on a click-through basis now and then,
but I'm not really sure it's worth the effort. At least, it
hasn't been for us. We haven't really seen ways to
shave massive amounts of money off what we're
paying for ads that way.

Conclusion

If your questions were not addressed, please feel free to post them in our
LinkedIn group.

You can access the group via your event login page at:
http://www.whitepapersource.com/facebook2011/


Transcript - Facebook Marketing Success Summit Ads Presentation 2011

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