Why Should You Advertise? Because it works!I’m sure you have at least one friend who says Facebook advertising is a bad idea for one reason or another. Maybe they even reference some article or case study written by a blogger who lost money with Facebook Advertising. Your friend’s full of it. If so many people are losing money with Facebook Advertising, why were there over 1 million advertisers on Facebook spending a whopping $8 billion on Facebook Ads? Advertising on Facebook has grown over 680% since 2010, so there must be a good reason for this.
- AdEspresso is a subscription based service. This means that to be profitable, we need our users to stick around for a long time. If Facebook Advertising is underperforming for our users, they’ll stop using both Facebook and AdEspresso. We want you to succeed!
- Before starting AdEspresso, I owned a successful Web agency. I wouldn’t have left everything (and risked everything) to start AdEspresso if I didn’t believe in Facebook Advertising. I obviously did my research and experiments before jumping into this new business to make sure it was viable. After tracking millions of dollars of ad spending, I’ve personally seen Facebook Ads work for businesses of all sizes.
Demand Generation vs Demand FulfillmentTo understand why Facebook Ads can be such a great tool for your business, you first have to understand the difference from its main competitor: Google Adwords. I guess you already know pretty well how Adwords works. The user searches something, they see your advertising, click on it, and buy your product or service. Pretty simple isn’t it? Demand fulfillment in it’s purest form. There are, however, a couple of problems with Adwords’ system:
- For every product, there’s a limited set of related keyword you may use for advertising purposes. If you have many competitors bidding for that limited set of keywords, Google Adwords can quickly become extremely expensive.
- You can only fulfill an already existing demand, which is often very limited — many times, target users won’t actively search on Google for a solution.
Here’s the biggest difference between those things and advertising on Facebook: On Facebook, you don’t care what your users are searching. On Facebook, all that matters is who your customers are. This means you’re targeting real people with real interests, hobbies, and jobs – not keywords.
An example of how Facebook Ads can grow your businessHere’s a hypothetical example. Imagine you’re the owner of YouthRazor Inc. and you’re about to launch your new product: The most revolutionary razor on the market for young people dealing with their first shaving problems.
The product is awesome and the market is simply huge – you just have to let every male teenager about your product! So, you go on Google and start bidding for keywords like “Teenager shaving,” “Teenager razor,” etc. Gosh! The results are amazing! It seems like every person performing those searches clicks on your ads, and most of them buy your product.
But your dreams are pretty soon dashed by an awful truth: Teenagers are not searching for razors on Google. Even though every male in the world has bought at least once some kind of razor, the volume of Google searches for them are pretty low. They just go to the mall and pick what’s on the shelves.
Your mind blowing 40% conversion rate on Google Ads will simply never make you rich because demand for buying razors online is just too low for your business to bloom. But, you know the market is potentially huge and it needs your solution! What do you do?
You turn to Facebook Advertising and start playing with it. You quickly create a nice advertisement and target it to every male in United States with an age within 13 to 20 years old. In just few minutes, you’ll be able to generate demand for your products among your entire target audience.
Sure, your conversion rate won’t top the 40% you had on Google, but business-wise, your chances of seeing YouthRazor Inc. on the Fortune 500 list are much higher when converting 5% of the 20 million young males in the USA than converting 40% of the 100,000 teenagers searching for razors online.
It's getting better every dayThe Facebook Advertising platform is getting better every day. It’s now become a mature ad platform that still has lots of room for innovation. Just think that only few years ago, a Facebook Ad looked like the pictured on the right.
Don’t believe me ? Here are a couple of examples: In the last few months Facebook dramatically improved Custom Audiences, allowing you to use retargeting or target a very specific niche of users that suits your needs. With these new features, advertisers have managed to lower their new customer acquisition cost by as much as 73%. This kind of targeting is so laser-focused that Facebook ads are now a very good solution even for B2B companies, once Facebook advertising’s Achilles’ heel.
Facebook’s platform works well for mobile advertising, too. Though it only started offering mobile-only ads in 2012, mobile ads have already become one of the best acquisition channels for mobile developers to boost their apps and get to the top of app store charts.
Today, 53% of Facebook Advertising revenue comes from mobile ads. Here’s the beauty of it all: Every time Facebook releases a new feature for its advertising platform, there is a short time frame (usually just a couple of months) when most advertisers are not using it.
Those who try these new features first can benefit from the slow adoption rate by experiencing amazing performances and staying ahead of the curve. In fact, the first developers who adopted Facebook Mobile App Install Ads had a cost per install as low as $0.10!
So, are you ready to jump on the Facebook Advertising bandwagon and start generating sales for your business? You should be – as we’ve shown above, Facebook is a powerful, versatile, and effective advertising platform. Jump to the next chapter to learn the basics of Facebook Ads and set up your account !