Facebook Ads : How to Understand and Use them for Profit
“Business is the activity of making money by producing or buying and selling products” — Wikipedia
Now, any business worthy of the name will sell its products and services online — but many still wonder how to properly leverage facebook advertising to do so.
Read on, that is exactly what this article will help you achieve. You will learn exactly how to wrap your head around Facebook Ads, and how to leverage audiences, key performance indicators and copywriting to your advantage.
Let’s dive right in.
Create the perfect audience
First things first. You are selling to people, and people come first.
Taking time to create your audiences in Facebook Business Manager is similar to building strong foundations for a house.
If you don’t, there is no saying how long the structure will hold up. Therefore, you will want to take the time to get as deep into the mind of your potential customer as you possibly can. This will serve you in more ways than you realize.
That is why, before going into the specific types of audiences you need to create and how to do so, you should be reminded that building a customer avatar is paramount and compulsory.
Interest
The first type of audience you need to learn to create is the “interest” type audience, also called saved audiences.
It is probably less likely than the two others to generate good returns, but it is still important for several reasons :
1- You never know : you COULD stumble upon a gold mine that actually does better or at least equally as good as your Lookalike and Custom Audiences.
2- The risk is low : you can kill your ads at any point in time (to learn how to optimize properly, you can jump to the part about Key Performance Indicators.
To create any kind of new audiences, go to your Business Manager, under “All Tools” then go to “Advertise” and then “Audiences”. Click create new.
Ok… Now what ?
Well there is one thing that should take 80% of your focus, and it is the targeting. For the rest, refer to your customer avatar (you have it, right ?). The same goes for the targeting we were just mentioning, except you are going to have to dig deeper.
What you need to do is create several interest audiences (5 to 10 is a good number). And for each one, you are going to target depending on one of these categories :
- Influencers
- Books
- Softwares
- Job title
- Etc…
All done ? Now, create a Lookalike audience if possible.
Lookalike
The second most profitable type of audience is the Lookalike audience. In simple terms, Lookalike audiences are people that LOOK LIKE your customers. Facebook’s algorithm determines characteristics of your source audience, and goes looking around for people that match these characteristics as closely as possible. What you need to do is feed Facebook’s algorithm by uploading your client’s emails list into the Audience manager. Then, you can ask Facebook to look all around the world to try and find similar people.
The pathway to creating this audience is the same as it is for your interest audiences, you only have to select Lookalike Audiences.
At this point, you actually have to have a custom audience installed, and you will need to use it as a source for your Lookalike. You should first create 3 different Lookalike Audiences : 1%, 1% to 3%, and 3% to 6%.
The very next step goes into the details of the custom audience creation.
Custom Audiences
It is the best type of audience, you advertise directly to highly qualified leads. In that case, you can add your email lists, (you need over 1000 emails in your list for it to be effective), you can decide to retarget the traffic of your website over the last day, 3 days, week, 15 days, month… up to the last 180 days.
These audiences are the most powerful, simply because they are warm-to-hot audiences : they have shown clear interest for your brand in the past, either by subscribing to you, consuming your content in video format, visiting your website… Since we know that the more touch points you have with your audience, the more likely they are to buy your product or service, it makes sense then to consider them as your most valuable leads. Actually, your paying clients are your best bet at making a sale.
Go to “Audiences”, create a “Custom Audience”. For example, let us say that you have an email list of over 1,000 emails. Once inside the custom audience creator, choose “Client List” : At this point, you can upload your email list (.csv file, taken from your CRM), and create this audience.
You can then use that audience to create a Lookalike Audience that matches this Custom Audience.
All done creating your audiences ? Let us dive into your business now.
Create the best possible offer
After you determined exactly who you were going to sell to, it follows that you are going to have to focus on the WHAT (you are selling).
The offer is just as important as the audience : its second position is merely justified by the timeline. Therefore, you should take this step seriously, with gravitas even.
Product
For this second step, you have to look again at what it is you wish to promote. Whether you are a travel agency wishing to put forward a great traveling experience, or if you are a consultant who wants to generate leads for an amazing e-learning about stress management, the emphasis should always be put on the value you are bringing to the table.
Is your product genuinely bringing value to your potential customer ? If a person decides to go for your brand, your service, your product, is that customer going to be satisfied with it ? Can you deliver ?
If the answer is a resounding yes, you can go forward. On the other hand, if you have any doubt, you better work on that step, and come back with as solid an offer as possible. Indeed, the greatest ad in the world will not make up for a lack in your offer.
So, you think your offer is up to the task? It is now time to set the stage, and create the pathway you wish your prospects to follow to your riches…
Funnels and Lead Magnets…
The next step is where the Sales funnel comes in. You can visualize it as a set of virtual rooms that you have to create, with doors connecting one room to the next, in a linear sequence. Your product or service is located in the last room, in which your prospect should be compelled to finish his journey. Whether or not you can guide your potential customer down this funnel will depend on your ability to make that path clear, simple, rewarding and worthwhile (tons of value are most welcome here).
We are not going to go into the details of creating a funnel, but let us take a look at the simplest lead generation funnel possible : a Landing Page, followed by a Thank You page.
The landing page should be relevant, and reflect the content of the ad that brought your potential customer onto it. At this stage, your purpose should be to give as much value as possible, in exchange for the name and email of your prospect.
In this instance, the value you are providing is called a Lead Magnet. It is, as its name implies, a magnet, meant to pull in the lead. Although, to fulfill this quality, it will need to be compelling enough for the prospect to perceive this exchange as a win.
In order to gently push your potential customer through that first door, you will have to craft your title, subtitle and copy properly. To that effect, please refer to the following section about how to cut through the noise by creating the perfect ad.
Last but not least, the Call To Action has to be located in the forefront, standing out as the only viable next step.
Your Key Performance Indicators and Custom Conversions
Your Key Performance Indicators will be the baseline on which you can rely to properly analyze and optimize your ads.
Therefore, they represent an invaluable asset for you and your business.
The way to calculate them is to start from the end and calculate what each step is worth to you, and how much your are willing to spend to get your potential customers to travel down the funnel.
As outlined in the artistic drawing above, you need to know these things :
1- Price of your product or service
2- Number of steps in your funnel
3- Conversion rate from one step of the funnel to the next (if you do not know this number, you can llok for benchmarks online according to your specific industry)
In order to give an example, let us stick to our basic funnel, and say that your service is worth $1,000. Let us imagine that you convert 5% of the people that land on your Landing Page into paying customers.
By multiplying $1000 by 5%, you can determine how much you are willing to pay to get a prospect onto your landing page, which in this instance is $50.
In this unrealistic example, you know that you would be willing to pay $50 dollars for someone to click on your ad and get to your landing page. Also, in this instance, you would only break-even.
Were you to want a 2XROI (make twice as much as your investment), you would need to make the same calculation from $500 and get a $25 result.
Alright ! Now that you now how to monitor your profitability, let us take a look at what makes a good ad.
Crafting your first profitable ad
The deck is set. The pieces are about to move, but for that to happen, we still have to craft a great ad. Remember the customer avatar you created ? It will be of GREAT use during this last step…
A title that converts
The title will appear in bold in your ad. Combined with the description (copy) and the creative, it has to catch your prospect’s attention, be relevant to his or her needs, and be compelling enough to be clicked on.
There are plenty of ways to craft a title. If you need inspiration for your title, the first thing you should do is ask yourself what you would say if you had 10 seconds to sell your service to someone you met in the street.
Among the more actionable techniques you can use, you might want to take a look at this way of crafting your title:
How To [Feature of your Service] In [Time it Takes] To [Benefit of your Service] Without [Downside] ?
From that point forward, you can adjust, add a little creativity, remember to implement you customer avatar knowledge, and you should be good to go !
Copy that converts
The copy in your ad is what you write in the description part. This is something you can and should A/B test later, but what are you going to write in your description, to launch your ad ?
I would advise going for simplicity. Mainly, what you should do is focus on the benefits of your product or service, rather than its features.
Once again, your customer avatar should be an enormous help in determining what your service can actually achieve for your customer, and this is what should be emphasized.
After that, when the A/B testing part comes around, there are indeed a lot of different techniques and approaches, strongly emphasizing the negatives that your service helps relieve (or relieves altogether) being a powerful one among them.
But for now, keep it simple. And now, let us mention creatives.
Creative
A picture is worth a thousand words. It can be a video as well, but the point is this : human beings are very visual creatures, and your creative’s job is to cut throught the facebook feed’s overall noise, and convey your message as clearly as possible, by making sure that it is :
- relevant
- entertaining, if possible
- aesthetic, if possible
- informative, if possible (think infographic)
It is a good practice to add human features (people, basically) in your ads, as we human beings tend to pay more attention to this kind of content than any other kind of content.
If you wish to include text in your creative, you can, and it can actually yield good results, but keep in mind that Facebook will not allow you to use more than 20% of the space in your image for text.
As far as format goes, it is impossible to determine in advance which is better between images and videos, or else. Videos have the advantage of becoming assets for your business since you can retarget people having seen 25%, 50%, 75% or 100% of your video. Yet, as far as direct results go, the keyword here is test, test, test.
Testing will be your most valuable teacher now that you have all the elements to start creating profitable ads for yourself.
And Now…
You can now give it a go and launch your first campaign. Remember to focus on audiences, KPIs, and to create a punchy ad that will convert !
It is now time to you to pull yourself up by your bootstraps and get things done !
OR…
If you need help working on your ads, you can connect with me on Twitter, LinkedIn or to send me an email at contact@joshuamattei.fr. I can audit your website and help you advertise your business properly on Facebook and Instagram.
Good Luck !
Thank you for reading ! If you liked what you read and learned, and know someone who could benefit from this article, make sure to share it with them.
About this article
This article has been written by a student on the Grenoble Ecole de Management’s Advanced Masters in Digital Business Strategy. As part of a content creation assignment, students are given the task of writing articles based on their digital interests and disseminate the articles online. Articles are marked but we make minimal changes to the content. Thanks for reading!
James Barisic, Programme Director, MS DBS.
