Facebook – business advertising tips

Small businesses can benefit from many of the engaging tools on the social web, but is it worth advertising on a social network like Facebook?

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29th December 2008 at 10:00 pm

In the world of online advertising Google AdWords has ruled the roost for years with businesses big and small.  But can the ‘social graph’ of Facebook provide an attractive alternative?  Here are seven tips to help you start an advertising campaign on one of the world’s biggest social networks.

  1. First you’ll need a Facebook account, if you’ve not already got one.  It’s very easy to set up, but do be conscious about what personal information you put up on the site.  Your business and personal privacy are your responsibility.
  2. Then head for the applications list which you can find in the icon bar at the bottom of your screen and click on the Facebook Ad Manager or go straight to Facebook advertising to create an ad.
  3. And here’s where things get interesting and you get your first encounter with what’s been described as the Facebook social graph.  After you’ve included some ad copy and an image of your product or service, you can get stuck into targeting your ad.  In the UK, for example, it will instantly reach all Facebook members which count over 13 million.  But you can hone this demographic down by age, gender, workplace, relationship status and keywords.
  4. The resulting ad suddenly becomes very focused and well targetted.  It can also become a ‘social action’ in its own right.  Facebook members clicking on the ad (if they give their permission) will show their friends that they’ve acted on it in their own Facebook news feeds, thereby creating a level of endorsement which is hard to find elsewhere.
  5. Once your ad has been created, as with Google AdWords, you place a bid on the price you’d like to pay per click which sets the frequency with which your ad appears across the network.  Right now you can get reasonable results with a maximum cost per click of around £0.20.
  6. Facebook has improved tracking and statistics on ad performance.  You can see and download data for a variety of time periods and to compare ad effectiveness. You can also  compare performance and track social actions linked to them, as well as CPC (cost per click), CTR (click through rate) and CPM (cost per thousand impressions).
  7. Interestingly the click through rates are extraordinarily low – often less than 0.05%.  This suggests people are much less likely to act on ads within a social network than in other places on the web.  But the volume of page views available daily on Facebook, even after you’ve focused your demographic means a low CTR becomes less important.  Definitely worth experimenting, but make sure you set you maximum daily spend to levels that make sense while you test the system.

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SmallBizPod is the UK's first small business podcast for startups and entrepreneurs, founded in March 2005. http://www.smallbizpod.co.uk

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