What is Facebook advertising?
Facebook allows businesses to target users with their ads based on many targeting mechanisms – including, interests, behavior, engagement with brands, demographics and location. It is an excellent tool for new customer prospecting and driving marketing scale.
Why advertise on Facebook?
About 50% of New Engen’s managed spend is on Facebook. Why is this so high? Facebook is scalable and is a tool for true new customer prospecting – meaning it allows for businesses to easily target those who have never engaged with their business before.
Facebook is an excellent tool for businesses that are new to the market and have yet to broadly introduce their product to the world. Search marketing allows businesses to target users based on what they’re searching for. But, what if people aren’t searching for your product – or terms related to your product? This is where you need a medium through which to proactively target users based on interests, behaviors and attribute versus waiting for them to search for something.
As a business becomes more mature, and more people are searching for your product or keywords related to your product, it’s common for businesses to expand paid search and shopping efforts. But, Facebook always plays a role, because companies of all sizes will always be interested in new customer acquisition.
While Facebook is an important channel, one challenge to be aware of is, when introducing other channels, it can become harder to correctly attribute conversions to the right channel as Facebook tends to see heavier view- and cross-device traffic than search for example. This shouldn't impact your strategy - it's something to be aware of as you analyze performance across channels.
How does Facebook advertising work?
Facebook ad accounts are organized into campaigns, which contain ad sets, which in turn contain ads. It’s at the campaign level that campaign types are created and campaign objectives are set. While there are many different campaign types available, at New Engen, we tend to focus primarily on customer acquisition, and therefore we tend to focus on Prospecting campaigns, although we also run Retargeting and Remarketing campaigns.
- Prospecting – Target new customers who have never engaged with your business before. This is the heart of new customer acquisition. Prospecting campaigns exclude people who have purchased from or engaged with your business in the past.
- Retargeting – Target people who have engaged with you in the past but have not purchased.
- Remarketing – Target past purchasers.
- Dynamic Product Ads (DPAs) – These types of campaigns leverage and dynamically serve products from a catalog to a user based on past behavior (for Retargeting and Remarketing DPAs) or based on what Facebook knows about the user and what they’re likely to purchase (for Prospecting).
Facebook enables marketers to select from various types of campaign objectives – which are what you want people to do when they see an ad, which should align with your overall business goal. At New Engen, we focus on customer acquisition, so we almost exclusively optimize toward conversions.
When selecting a campaign objective, there are two primary points to consider:
- Is there a pixel that is correctly firing based on your ultimate campaign goal?
- Is enough data passing through the pixel to allow Facebook enough information to learn (we typically look for at least 50 conversions per week)
Below are the campaign types Facebook allows companies to select from:
- Conversion – The primary objective we use at New Engen
- Consideration – Traffic, app installs, engagement, video views, lead generation, messages
- Awareness – Brand awareness, reach
Here at New Engen, we typically use a subset of campaign types:
Whenever possible as it optimizes toward what we care about most: Conversions
|Product Catalog Sales||Whenever we are running Dynamic Product Ads (DPAs) campaigns|
|Traffic||You have no other pixel events to optimize toward|
|App Install||You have an app with no down funnel usage SDK event to optimize toward|
|Video Views||You priorities brand building|
|Lead Gen||You have a long consideration or qualification process for your conversions|
You have no other pixel events to optimize toward
Audiences and targeting are set at the ad set level.
There are many different types of audiences that can be created using targeting options Facebook has made available to marketers using all the data they have on their users. Audience types include:
- Lookalike (LAL) – Prospecting audience list Facebook builds based on a list that a marketer can building using names and email addresses of past purchasers, website visitors, etc. Facebook will then find people who "look" like those on the list. Lookalike lists are typically built using email addresses provided by the client, or by using pixel activity directly through Facebook's native UI.
- Facebook requires a list of at least 100 names, although we recommend keeping lists under 5,000, because if the list is too big, the audience will be too diverse. From our experience, the suite spot for lists is 1,000.
- Each percentile of a lookalike audience (i.e. 0-1% or 1-2%) contains 2.1 MM people.
- Historically, 0-1% LAL audiences perform best across the board. If an audience works well, you can try expanding the size to a broader LAL (e.g. 2-5%). Typically we recommend keeping LAL audiences smaller than 5 MM people.
- Common types of customer lists used for seed lists include: high value customers, frequent purchasers, seasonal, etc.
- Interest-based – At New Engen, we lump all other demographic, interest, behavior and geographic targeting into this bucket. Facebook will collect interest and behavior data on users based on sites users visited, messaging text, IP addresses/location and friends. Typically we'd recommend making interest-based audiences larger than 1 MM people.
- Retargeting – Visited site, viewed a product or added to cart but didn’t purchase. This audience is usually based on a pixel that’s placed on every page of a business’ site.
- Remarketing – Previous purchasers. This audience is usually based on a pixel that’s placed on every page of a business’ site.
Ads live within ad sets. There are many different ad types that marketers can, and in many cases should, test into over time depending on what makes sense for the business:
- Single image
- Offer Ads
- Instant Experience
- Lead Generation Ads
- Post Engagement
As a best practice, at New Engen we have seen best results with running 4 ads within an ad set at a time – this allows you to appropriately test ads against each other. If you have too many ads running at a time, you may not get an appropriate read on how the ad is performing, especially if Facebook chooses not to serve it.
In addition, we have seen the best results with running auto placements for all ads, which tells Facebook to serve the ads where they believe people will most likely convert. The reason for this is Facebook has so much information on users, they are more likely to get the placement right.