PUBLISHED: Apr 6, 2010 4 min read

Facebook Advertising – Who Should, and Who Shouldn’t

James Connell

James Connell

Group Director, Media + Analytics

By now, most advertisers are familiar with the basics of paid search advertising: you choose a list of keywords that you want to trigger your ad, select the maximum you’re willing to spend per click, and then instruct the search engines to match you up with people searching for your terms.  Since searchers are looking for a specific service or answer at the time of the search, paid search is great for transactional advertising such as generating sales or leads.  If you are offering exactly what the searcher is looking for, he or she is likely to convert.

More People Now Visit Facebook Than Google

Search engine advertising has been a dominant force in the world of online advertising for years now.  However, with Facebook taking up an ever-greater share of people’s time online, it is inevitable that Facebook will also account for an increasing share of online advertising.  That said, Facebook advertising isn’t useful for every business.  Here is some information to help you decide whether your company should give it a try.

Facebook Isn’t As Good For Transactional Ads

On Facebook, people see your ads earlier in the interest cycle than with paid search ads.  Facebook advertising is therefore less useful for transactional advertising than paid search.  Instead, companies use Facebook to create awareness of, interest in, and engagement with their brand.  Whereas best practice for paid search is to include a strong call to action like “Buy Now!”, Facebook ads should focus on softer benefits your company can offer such as information, contests, or coupons.  Campaigns typically target potential customers at the start of the sales funnel, or even before they know that they need a service or product, and ads can lead people who click to a landing page or the company’s fan page, depending on the campaign’s goal.  In order to eventually realize sales from a Facebook campaign, companies must follow up with a long-term customer engagement strategy so that they stay top of mind.

Different Targeting

Facebook also differs from paid search in its targeting capabilities.  It does offer the ability to target by keyword (Facebook calls it “Likes & Interests”) and location, but also by demographics such as age, relationship status, education, workplace, and even college and major.  This means that if you know the demographics of current and past customers, you can target others just like them.  In all probability, most of these people won’t be in the market for your company’s product or service at the moment they see your ad.  However, the ad can create awareness and engage them with your brand.  Then, when they are in the market, they’ll know where to look first.  Better yet, they’ll (hopefully) recommend your service/product to their friends.

Who Should Advertise On Facebook

So what sorts of companies should advertise on Facebook?  The prime candidates are businesses that can have an ongoing relationship with consumers such as restaurants, retail, theaters, gyms, even tax accountants.  A spa is a great example of a business that could benefit from advertising on Facebook.  Because spas fulfill a need that is relatively unpredictable on an individual basis (aside from birthdays & holidays), a spa needs to stay top of mind with its customers through emails, flyers, and other points of contact.  Spas need to constantly expand their customer list, and that is where a Facebook ad campaign could play a big role.

For example, a spa could run ads targeted to women at nearby companies asking them to sign up to receive monthly coupons.  The landing page would include not only the email signup form, but also a “Become a Fan” icon in a prominent position.  When a visitor becomes a fan, Facebook will list that fact in the her news feed, and also underneath the spa’s ads when those ads show to her Facebook friends.  In this way, the ad serves to build the spa’s email list, increase Facebook fans, and spread the word about the spa to each new fan’s friends.  Although the ad probably won’t result in any immediate sales, the spa should realize sales down the line when it offers a great deal, or when one of its fans finds herself in dire need of a treatment.

To sum up, if your company offers a service or product that is typically purchased at frequent intervals, and if it has a long-term engagement strategy to stay top of mind, Facebook advertising is a great way to gain new customers.  However, if demand for your company’s services is more intermittent and/or urgent – locksmiths, for instance – then Facebook probably isn’t for you.