Facebook Ads: Optimize for Awareness, Not Direct Sales


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The Challenge: Facebook Ads has not proven to be an effective direct sales medium. While this has led to shareholder frustration, advertisers should ignore the focus on sales and optimize for engagement and awareness.

Facebook Advertising

When it comes to Facebook Ads, there’s a significant disconnect between Wall Street and Madison Ave. Since Facebook’s IPO in May, investors have been looking for revenues high enough to justify a multi-billion dollar market cap. They haven’t found them. On Thursday last week, Facebook released their first earnings since their IPO. For investors, the results were predictably disappointing.

For advertisers, the fixation on Facebook’s earnings is a distraction. The plain fact is that Facebook Ads isn’t a direct sales channel; it’s an awareness channel.

Earlier this month, Ad Age and Citigroup conducted a survey to determine why marketers use Facebook Ads. Overwhelmingly, marketers use Facebook Ads to, “Build awareness and sentiment for my brand.” Others were trying to drive website traffic or build their fan base. Fewer than 10 percent of respondents said they were trying to generate sales leads or engage in social commerce.

The Ad Age survey reflects an important reality about Facebook Ads: while they’re a powerful way to build brand awareness, they are not a strong direct sale mechanism. Of course, this doesn’t mean that marketers should ignore them altogether. As Max Kalehoff recently wrote at MediaPost, “Facebook Ads, thus far, have proven to work best toward top- and middle-of-funnel marketing goals. Therefore, the fact that brand-building is the top goal is not surprising.”

When marketers recognize Facebook Ads as an awareness and engagement channel, they can optimize and budget their Facebook investment accordingly.


» Allocate Budget for Every Stage of the Conversion Funnel

Ultimately, your entire marketing budget is directed toward one goal: driving revenue. That said, each stage in the conversion funnel should have its own budget. Determine how much you’re willing to spend at the top the funnel – “Awareness” and “Lead Generation” – and allocate a percentage of that budget to Facebook Ads.

» Define “Awareness” KPIs (“Key Performance Indicators”)

If you optimize your Facebook Ads for direct sales, you’ll always be disappointed. By defining “Awareness” KPIs, including “likes” and website visits, you’ll be optimizing for Facebook’s strengths. Measure results accordingly.

» Track Facebook Leads to the End of the Funnel

Not all leads are created equal. Determine how often leads generated by Facebook Ads eventually lead to sales, and allocate your “Awareness” budget accordingly.

Republished with author's permission from original post.

Ernan Roman
Ernan Roman (@ernanroman) is president of ERDM Corp. and author of Voice of the Customer Marketing. He was inducted into the DMA Marketing Hall of Fame due to the results his VoC research-based CX strategies achieve for clients such as IBM, Microsoft, QVC, Gilt and HP. ERDM conducts deep qualitative research to help companies understand how customers articulate their feelings and expectations for high value CX and personalization. Named one of the Top 40 Digital Luminaries and one of the 100 Most Influential People in Business Marketing.


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