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Technology Tip

Technology Tip
Dave Pelland Dave Pelland has extensive experience covering the business use of technology, networking and communications tools by companies of all sizes. Dave's editorial and corporate experience includes more than 10 years editing an electronic technology and communications industry newsletter for a global professional services firm.

Facebook Advertising for Small Businesses

Facebook Advertising for Small Businesses

As small business owners evaluate the many ways they can promote their companies, Facebook advertising is gaining momentum as a cost-effective way to reach and expand their potential audiences.

Facebook says more than 50 million small businesses have created company-specific pages on the platform, and within this group, at least 3 million are experimenting with advertising. More companies are investing in ads because getting customers and friends to merely “like” a page isn’t as effective as it was a few years ago in marketing your company and its products or services.

As Facebook adjusts the algorithms it uses to determine which content gets displayed on users’ news feeds, fewer posts by small businesses are presented to people who have liked a given page. On average, a page with about 10,000 likes can expect a post to be displayed on the news feeds of about 300 or so people.

Although some companies are finding success in selling products directly via Facebook, a more common and effective strategy is using Facebook advertising to promote brand awareness and generate leads.

Understanding Facebook Ads

The primary difference between Facebook advertising and pay per click ads on search engines is that Facebook ads rely not on keywords, but on the targeting of users in a variety of ways.

That targeting is one of the main advantages of advertising on Facebook, because you can direct ads based on a Facebook user’s location, age, sex, education, interest, political affiliation, or other types of demographic and use the social information they include in their profiles. Unlike traditional ads aimed at broad audiences, Facebook allows businesses to aim ads at a very narrow demographic or interest group.

This means even a modest investment in Facebook advertising is likely to be more effective than trying to reach small portions of a larger audience through traditional ads.

You can place Facebook ads for as little as $1 per day on the site, with the reach and frequency of your ads increasing proportionally with the size of your investment. Advertising professionals say business owners should target about a 1.8 percent conversion rate on their ads, meaning that if your ad is seen by 500 people, about 10 will take the desired action you are seeking.

Although this may seem like a low return, Facebook targeting means you are more likely to reach the right 10 people through your ad than would be the case with a print ad or mailing postcards.

Know Your Goals

The type of ad you placed and what you say in that ad, will depend in large degree on your goals for placing that ad. You may wish, for instance, to direct customers to your company website, promote the number of likes your page receives, or target Facebook users near your location for a specific event. Thinking about your goal before you place an ad is a critical first step in the ultimate success of your marketing campaign.

You should also spend some time thinking about the prospects you are trying to reach. The more thought you put into determining the characteristics of your ideal customer, the better you will be able to reach them through effective targeting.

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