More conversions from Facebook than AdWords?

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More Conversions From Facebook Than Adwords?
For the first time, we’re seeing a Facebook ad type that can really drive sales for brands… and even outperform Google AdWords

One of the biggest criticisms of Facebook advertising over the years has been that while Facebook ads drive visits to a website, they just don’t drive sales (a.k.a. conversions). We’re still running those cute, little right column ads for clients, either to build fan page “likes” or to drive Facebook users to a client’s website, but we’ve only been running these right column ads because they’ve been a vastly cheaper alternative to other upstream awareness-building media, like online display advertising, outdoor, or TV.

Everything changed late last year, when Facebook began to allow advertisers to advertise directly in consumers’ newsfeeds with Sponsored Posts. With these new, Sponsored Posts, We’re finding that they actually drive more conversions at a lower cost per conversion than even Google AdWords for some brands. Of course, that does depend on using the right targeting and especially the right creative messaging and imagery.

Here’s An Example…
Let’s look at a real case study from one of our clients that shows how Facebook sponsored posts have had a dramatic impact on conversions. The client provides a service in a very, very competitive category and an acceptable cost per conversion is less than $60.00. That means that paid search is valuable but needs to be managed profitably; hence, there are limits to spending efficiency.

Google AdWords — Highly Profitable, But Mature
On Google AdWords campaigns for non-branded keywords, we drive an average of 1,600 clicks and 114 conversions on a spend of $6,400 per month, a conversion rate of 7.1% and a cost per conversion of $56.30. Whenever we expand keywords, increase bids for a higher page position, or do anything else to expand the reach of the campaigns, cost per conversion rises far beyond acceptable levels to the client, so we’ve really hit a wall– we call this a “mature” Google AdWords account. To grow sales, the big focus for the client has been to expand reach to drive sales with other ad types.

Bing Ads — Great But Limited Scalability
We’ve had great success with Bing Ads, which we’ve optimized to drive an average of 700 clicks and 67 conversions per month on a spend of $1,680 per month, for a conversion rate of 9.8% (which is 25% higher than AdWords) and a cost per conversion of $24.45– less than half the cost per conversion of Google AdWords. The only issue is that as with AdWords, it’s mature, and any attempts at expansion mean we drive cost per conversion over threshold limits.

Facebook Right Column Direct Response Ads to Prospects — Not So Great.
One ad type we’ve tested for the client has been Facebook right column ads, what we call “direct” or prospects ads (direct response ads that drive traffic from Facebook to specific landing pages on the client’s site). Unfortunately, we saw the same results we typically see in generating conversions for Facebook right column ads. In our best 3 months of testing, we drove 2,943 clicks on a spend of $1,300, but only drove 12, yes, 12 conversions– that’s a conversion rate of on 0.4% and a cost per conversion of $108.27–terrible… And that’s typical for right column Facebook ads.

Facebook Sponsored Posts– At first a Dog, now a Goldmine
When we started testing sponsored (in-newsfeed) posts, we expected them to be better than right column ads… and they were better than right column ads in terms of cost per conversion ($83.53 vs. $108.27), but they were even worse than right column ads in conversion rate (0.2% vs. 0.4%). So we knew we had a long way to go to optimize.

The first 3 months of testing were pretty dismal actually:

Cost $2,004.66
Clicks 11,769
Conversions 24
Conversion Rate 0.2%
Cost Per Conversion $83.53

Then we started testing and optimizing. One of the massive advantages of running sponsored posts as “dark posts” out of the Facebook Ads Manager, rather than just boosting posts off a brand’s timeline, is that we can A/B test creative messaging and images in real time. We can also fine-tune and test targeting along with ad creative; where with boosted posts on Facebook, Facebook simply shows the ads to fans and friends of fans, or a disappointingly limited number of interest segments and only the most basic demographic targets. Over the course of several months we tested creative messaging, imagery, and targeting, and literally hit the jackpot and expanded spending as a result.

Metric Feb-April Totals May-July Totals
Cost $3,943.45 $15,693.09
Clicks 10,511 41,545
Conversions 95 581
Conversion Rate 0.9% 1.4%
Cost Per Conversion $41.51 $27.01
Cost Per Conversion $41.51 $27.01

Facebook Sponsored Posts — More Conversions Than Google and Bing Ads Combined
Here’s what’s amazing– we’re not only driving conversions at half the cost per conversion of Google and at parity with Bing Ads, but Facebook Sponsored Posts are driving more conversions for this brand than any other ad type!

Avg. Conversions Per Month
Facebook Sponsored Posts 194
Google AdWords Non-Branded Search 114
Bing Ads Non-Branded Search 67

By replicating this strategy of rigorous testing of creative messaging, imagery, and targeting, we’re finding that Facebook sponsored posts aren’t just a better version of right column ads, but that they can actually create the kind of demand that shows the true potential of what advertising on Facebook can do. And in some cases, as with this brand, the potential for driving conversions on Facebook is even bigger than the potential for driving conversions on Google and Bing Ads Paid Search combined.

Have questions about Facebook Advertising? Contact us!





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