April 20, 2010

Maximizing the ROI of Facebook Ads

On Facebook …frequency plus social currency equals dramatic increases in recall, awareness and purchase intent. That’s the conclusion and the prescription from a joint Nielsen-Facebook study of  800,000 Facebook users exposed to 125 campaigns from 70-odd CPC, retail and entertainment brands over 6 months. 

Titled “Understanding the Value of a Social Media Impression” and authored by Jon Gibs at Nielsen and Sean Bruich at Facebook, the focus was on three ad types … 

Paid Homepage Ads. Creative content, offers, deals and “Become a Fan” options that are bought and appear above the fold on users homepages. Targeted by a broad range of psycho-demographics, geography and keywords, this is similar to traditional small space or online advertising. Reach is limited only by budget. Facebook users recognize these as ads. Response is in the standard 2 percent direct marketing range. 

Social Impressions. Combine paid ad creative with social currency by including the names of users’ friends in the ad unit, which is served to user’s homepages above the fold using the same targeting criteria. Reach is partly a function of paid and passed-along impressions. Users see these units as ads with privileges. 

Organic Impressions. These earned media impressions are the News Feed messages served to existing fan pages that are passed along to friends of fans. These are the most persuasive and welcomed units but reach is limited by the current number of fans per brand. Generally these units have the most impact and the smallest reach. But you can’t buy more of them even though the study found a 24 percent lift in the number of users engaging with a campaign due to exposure to organic friend-driven messages. But not every fan will pass the word along. And not every friend of a fan will appreciate the commercial branded message. 

The secret to a successful campaign is combining the formats to achieve sufficient frequency and reach with plus the added persuasive mojo of social and organic impressions passed along from friends to friends; the ultimate in digitally-assisted word-of-mouth advertising. 

The units are complimentary and work best in a combined plan. Adding social advocacy units to a traditional homepage ad buy increases recall 60 percent, doubles awareness and quadruples purchase intent. Naturally more exposure drives more of everything just like other media. Those exposed to 10 or more messages had 15 percent higher brand recall. 

The success formula suggested by this data is …

  1. Build as big a fan base as you can. Encourage fans to enroll their friends. Offer special deals to stimulate fandom. Routinely serve them interesting content and incent them to pass  your messages along.
  2. Buy homepage ads using psycho-demographic and geographic criteria. Test small batches before you roll out major campaigns. Test alternate creative executions and offers. Use events, holidays and the retail calendar as triggers.
  3. Experiment with social advocacy ads. Embed the names of friends into ads and see what happens. Count. Tweak. Try again.
  4. Create a 1-2 punch. Coordinate the messaging and the timing of a mini-campaign by linking the messages, images, offers in the different units and hoping that 1+1 will be much more than 2.       
Apr 20, 2010 12:52:19 PM | SOCIAL MEDIA

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Danny Flamberg

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