Stronger Evidence that Facebook Ads Work

I’ve commented before that my post last February about Facebook advertising effectiveness, “Do Facebook Ads Work?,” is by far the most visited post on this blog and it continues to draw traffic. I followed with one on targeting that I think is important, though it hasn’t been as popular. Every time I do some research on Facebook ads I find something that I didn’t previously understand. This time it’s “social context.” I had seen it, but I didn’t really understand its source or its value.

What started me thinking about it was recent articles on the growth in Facebook advertising. Tuesday’s eMarketer newsletter pointed to huge growth in Facebook ad revenue.
Commentary in AdAge that pointed out that, “what is surprising is the majority of revenue, 60% or $1.12 billion, was earned from smaller companies in 2010, those more likely to be using self-serve tools rather than work through a media agency. That's greater than the $740 million coming from major marketers like Coke, P&G or Match.com.” In November, ComScore figures had revealed that Facebook was now the largest online display advertising publisher, with over 23% share.

Growth, of course, only implies advertising effectiveness; it does not document it. The most compelling piece of research (full document below) goes back to April, and after I read it several times, I began to understand the “social context” issue. Nielsen has identified three kinds of ads—ads with and without social content and organic impressions. Facebook doesn’t use this terminology in any of their advertising material that I can find. Facebook simply points out that all Facebook ad formats have the Like icon at the bottom to encourage social content. This page shows a homepage ad that has no social content. It also shows a homepage ad with social content; that happens if one of your friends has “liked” the brand. The final type is what Nielsen has termed an “organic impression,” a notice on the page of a friend of a user who has liked or engaged with the brand. Facebook uses the phrase “may appear on the news feed.” I couldn’t find out what “may” means here.

This chart from the same study shows that both types of ads with social content are more effective in recall, awareness and intent. Personally, that doesn’t surprise me because I tend to find myself paying attention to the names first and only secondarily to what they liked! Isn’t it human nature that when we see names of people we know, we pay attention? The study is brief, so page through it if you need more detail.

Advertising Effectiveness: Understanding The Value of a Social Media Impression

View more documents from Victor Rodrigues.

So how do you get more people to like your brand so they can appear in these ads? (Facebook’s privacy policy seems to give implicit permission for your name to be used when you like the brand. There is supposed to be a way to disable this feature, but I don’t know anyone who knows how to do it.) That makes the strategy issue for marketers getting more people to like their brand in the first place. And the best advice seems to be the simplest—just ask them! That’s what Virgin America is doing on the ads above. Going a step further, you can create something called a “reveal tab.” That allows you to make a members-only offer—to ask people to like your brand in order to get an incentive of some kind. These are two simple strategies that can add to your fan numbers.

And the point of all this is that the more fans you have, the more likely they are to show up as social context in your ads and as items on their friends news feed pages. That gives your ads the aura of being recommended by a friend of the viewer. And it has a high probability of making your ad more effective!

And so it goes in the wonderful world of Facebook!

Targeting Your Facebook Ads

Far and away the most popular post on this blog in recent weeks has been one written back in February, “Do Facebook Ads Work?” The answer was a strong “yes,” and research since then, including interesting findings on ad formats by Nielsen, continue to confirm that. A recent article in Bloomberg Business Week recounts the interesting story of the Nike “Write the Future” ad that was huge during the World Cup and goes on to talk about the importance of Facebook friends and the “like” function to Facebook advertisers.
















To demonstrate, I wrote a hypothetical ad on Facebook; that’s Step 1. Step 2 shows the main aspects of the targeting process. The advertiser can target by location (essential; no one needs to reach all 500 million Facebook fans!) and by demographics—age and gender only. So far, not different from traditional media advertising, and it works like Google AdWords as far as the setup is concerned.

Then comes the difference! On Facebook, the advertiser can target by “Likes & Interests.” This shows Facebook’s own description of a user profile. The implication seems to be that this is all data that the user has provided on the profile page. Not exactly. Every time the user “Likes” a friend’s post new data is created. What else? It’s not entirely clear exactly what/how other data provided by users like location data is collected and used. Prof. Eben Moglen of Columbia University Law
School says Facebook is “spying for free all the time.” You can read a summary of a recent speech in which he lays out the privacy concerns, but that still begs the question of exactly where the marketing data comes from.

The richness of the data is not in question, however. Nor is the usefulness of the Estimated Reach tool. Each time the potential advertiser adjusts any one of the targeting filters, the ER changes, so the exact effect of each descriptor is known. That data alone can tell you a lot about potential market size in a given region—no cost except expenditure of your time. Farther down on the targeting page, not captured in the graphic above, is the ability to target to your page (or groups) own members and, separately to their friends. Using the ER tool on your own page can give you fascinating insights into the composition of your fan base. Do you see a new market segment representing an opportunity you were not even aware of? Or do you see that you don’t have as many people from your target segment as you wish and need to run a campaign to get more friends.

All this creates a rich stew of research and advertising opportunities. You can access all this information from the Advertising text link at the bottom of your Facebook page, whether you are an individual user or have a business page.

The final piece of good news is that you don’t even have to buy an ad to experiment with the options. Why don’t you give it a spin???