With over 900 million users and an IPO just around the corner Facebook seems to be the top headline these days. It is really the premier social network for companies. Most social networks gear toward individual communication, while Facebook offers a way for companies to really engage with their consumers effectively. Every successful start-up business seems to be using or should if it wants to grow. Even traditional businesses specializing in tangible good distribution should be using it to draw attention to their products and overall message. Facebook is often used to promote products and ideas of a business, however it also has a very sophisticated and effective online marketing aspect.
This marketing aspect that is now a big part of enterprise Facebook usage is for companies to use ads. The Facebook Ads platform is a great way to generate additional business from consumers browsing on Facebook. The Facebook ad program is very intuitive and flexible when compared to Google’s AdWords combination. You can use the pay-per-click (PPC) model that is similar to Google’s Adwords, or you can use a cost-per-impression (CPM) model.
Advertisers pay Facebook to publish the ads on various areas of the social network including the homepage or user’s profiles. They are shown on areas of the social network with relevant information to the target audience or keywords in the ad’s description. Facebook Ads opens up a potential for new audiences that may be hard to reach through ad services such as Google Adsense, Amazon Product Ads, Yahoo Search Marketing, or Microsoft AdCenter. Facebook offers many places they can be spotted.
According to Facebook’s description (http://www.facebook.com/help/interacting-with-ads), “Ads can appear in the right-hand column of pages throughout Facebook. Ads are eligible to appear on many types of pages, including apps, photos, groups, pages, profiles (timelines), and the home page.”
Keep in mind we will be focusing on Facebook’s model for distributors and advertisers, and not on a model based on publishers being able to generate revenue from ads that were created by other parties. This is why we are not mentioning Google Adsense or Amazon Associates as the comparison programs, for instance, but using Google Adwords instead.
The great thing about Facebook Ads is that it allows you a lot of freedom in who you want to target with ads and what you are promoting. You don’t just have to rely on selling an individual product per ad click, you can promote an entire event for example. On Facebook’s website dedicated to this platform, Facebook lists websites, events, Pages and Apps as the services you can promote.
Another advantage is how you can target your consumers with this platform. There are just too many targeting options to list here. Some examples include location, language, education, work, age, and even relationship status. The more specific the target audience is for the ad you create, the greater the likelihood will be for you to gain new customers.
Other advantages of the Facebook Ads platform include the customization options you have in creating your ads as well as the way you can monitor your budget. You can design multiple ads from scratch for Facebook to use in this program and you can monitor the amount of money you want to spend in running them per day. The way you create your ad, will also determine your success rate. Besides an eye-catching image, Facebook allows you to include your page name, question, or key information in the title of the ad.
The ease-of-use and quick set up that Facebook’s program offers should really be noted among advantages. Facebook outlines the process in five easy steps in succeeding with the platform. Here are the steps involved:
• Step 1: Identify Your Goals
• Step 2: Target the Right People
• Step 3: Design an Engaging Ad
• Step 4: Manage Your Budget
• Step 5: Review and Improve
The flexibility of the ability to choose either a CPC or CPM model also cannot be underestimated. Competing ad platforms often only offer one or the other, but not the freedom of choosing either one (Google Adwords does, but Amazon Product Ads doesn’t).
Lastly, the service is relatively inexpensive when compared to the competition and is growing rapidly. According to the Wall Street Journal, Facebook actually overtook Yahoo in display ads during 2011. It is even climbing onto Google’s revenue figures. Here is the numbers the Wall Street Journal gathered relevant to Facebook’s growth as an ad platform:
“According to data from eMarketer, Facebook’s U.S. display-ad revenue should reach $2.58 billion this year, and is on track to reach $3.29 billion next year. Google, according to eMarketer, should see $2.54 billion in U.S. display-advertising revenue this year, and $3.68 billion next year.”
The Facebook Ads platform is relatively new when compared to rivals so there is still some uncertainty involved in what ads will remain to be supported and the methods that will thrive with the platform. It is also an ad venue that is targeting only Facebook users and not Web users as a whole. Not everyone uses Facebook that can be a potential customer. Many people only use Facebook sparingly to check messages, for instance, but don’t really engage in the social network.
Another disadvantage with using Facebook Ads is that you can only target each Facebook ad for users located in up to 25 countries. On the other hand, some competing ad platforms automatically target a world audience. This can be seen as a disadvantage particularly for those of you who sell products overseas. You will have to create multiple ads to target different countries rather than an individual ad. Also, if you select more than one country, you won’t be able to refine it in a way you would if you just target one country. For instance, you won’t be able to refine specific cities to be targeted by the ad — this is called geographic radius targeting.
Potential Restructuring of the Facebook Ads Platform
As mentioned previously, the platform may be undergoing some changes and that can be seen as a disadvantage for those of you who want a stable advertisement platform. A recent rumor suggests that on Feb. 29, Facebook may completely change the way it’s premium ad service is structured. According to AllFacebook, there will be various premium ad types that will be actually phased out completely and a new premium ad product may emerge to replace them.
As you can see, Facebook offers another method for eCommerce to find clients and generate revenue from products. It isn’t just a social network geared for individuals and companies simply interested in communicating a particular message. There are opportunities present that eCommerce outlets should explore in addition to Google’s and Amazon’s offerings (among others). A successful eCommerce outlet should explore all options and expand Facebook offers a great opportunity right now because the ad cost is still relatively inexpensive when compared to the bigger rivals in this department.
Image Source: http://www.flickr.com/photos/sorosh/1409771964/