25 types of business that can crush it with Facebook advertising
I get asked this question all the time
Charlie, will Facebook advertising work for my business?
If you’re an entrepreneur or small business owner, you will no doubt have been told at some point that you need to be using [insert marketing method from the list below] to market your business.
- Google AdWords
- SEO
- YouTube
- Snapchat
This advice will most likely have come from very well meaning, but often incorrect, friends, family and business associates.
The truth is.
Different businesses should be using different online advertising platforms. There is no ‘one size fits all’ when it comes to digital marketing. Just because your friend, who’s a lawyer, is generating loads of new clients through Google AdWords, doesn’t mean you’ll have the same success with your gym.
Now, of course there are exceptions.
In almost every single market, someone will be profitably generating sales and leads through Facebook advertising. But trying to be the exception can be very costly.
So I’m going to focus on identifying the industries that will get BETTER results with Facebook advertising than any other online advertising platform.
Just before we get into it.
Let’s quickly make sure we all understand exactly what Facebook advertising is.
NOTE: If you already very familiar with Facebook advertising, skip ahead to ‘the short answer’
What is Facebook advertising?
First of all it is NOT
Boosting posts on Facebook
If you’re boosting your posts, you aren’t properly advertising on Facebook. In fact, you’re actually wasting money. If you were to run the same post as a website click campaign, you would see far better results.
Facebook advertising is using the full Facebook Ads Manager to create campaigns around one of the other 10 campaign objectives. Your ads then appear in the Facebook or Instagram Newsfeed, or in third party apps on the Audience Network.
There’s obviously a lot more to Facebook advertising than that, but that’s all you need to know, to use this post and assess whether or not it will work for your business.
So let’s get back to the original question
Will Facebook advertising work for your business?
The Short Answer
To keep things simple, let’s start with the short answer.
I’ve created a list of businesses and professions that we’ve worked with and those that we know can have great success with Facebook advertising.
Now, this list is by no means comprehensive. If your business or profession doesn’t appear on this list but you think Facebook advertising would work for you, leave a comment below, and I’ll let you know if I agree.
- Accountants
- Chiropractors
- Clothing Retailers
- Coaches
- Consultants
- Dentists
- Event Planners
- Golf Clubs
- Gyms
- Interior Designers
- Jewellers
- Leisure Centres
- Letting Agents
- Luxury Retailers
- Nutritionists
- Online Store Owners
- Opticians
- Personal Trainers
- Photographers
- Physiotherapists
- Psychiatrists
- Real Estate Agents
- SaaS companies
- Spas
- Wedding Planners
Keep reading for the long answer and how to determine whether or not you should be advertising your business on Facebook.
The Long Answer
What is your average customer value (ACV)?
To use Facebook advertising profitably, you need to acquire a customer for significantly less than the cost of your product or service.
The higher the average value of a customer the easier it is to profitably cover your advertising investment.
So…
How much is your product or service?
With Facebook advertising you’re buying highly targeted website traffic and with the best website and sales team in the world, you are only ever going to work with a small percentage of the people that click through to your website.
This is an issue if your average customer value is £20.
Depending on your industry, you’ll find it difficult to acquire a customer for less than £20 with Facebook advertising.
But that’s not a problem provided your average customer value is high enough.
For example, we had a golf club client that had an average cost per customer acquisition of around £66 but the new type of membership they were promoting in their Facebook advertising campaign had an average customer value of £499. So, they were delighted with the ROI they achieved from their campaign.
What is your customer lifetime value (CLV)?
To get a full picture you need to also assess your customer lifetime value. Customer lifetime value is the single most important metric for understanding your customers. Roughly defined, CLV is the projected revenue that a customer will generate during their lifetime.
If you don’t assess your CLV you could incorrectly assume Facebook advertising isn’t for you.
Gyms and online retailers are perfect examples of businesses that will struggle to acquire a customer for less than the cost of one month’s membership or a single purchase (unless you’re a luxury retailer then it’s perfect because you have a much higher ACV).
In other words, a gym owner might spend £40 on Facebook ads to acquire a customer that pays £30 per month for their membership.
But if the average customer is on a 6 month or even 12 month contract
Then the minimum customer lifetime value is £180 on a 6 month contract and £360 on a 12 month contract.
And that looks like a pretty good ROI to me.
Summed up in a sentence…
Facebook advertising will work for your business, regardless of whether you are product or service based, if you have a high customer lifetime value (even better if you also have a high average customer value).
Do you currently advertise on Facebook? What has been your experience?
Please share your thoughts in the comments below or tweet me @charlielawrance.
Originally published on Charlielawrance.com
Want to know more about how Facebook advertising can work for your business, then click here to see how we can help.
