Generate Leads on Facebook? Yes, You Can!

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August 2010, Issue 78

Social Media
Generate Leads on Facebook? Yes, You Can!
By Mike Craig, Account Manager, 360Partners

The early days of paid search marketing were filled with much volume and little competition. As a result, it was fairly easy to have paid search campaigns that drove a positive ROI. Since then, paid search has grown into an entire industry. There are now many tools that assist in finding thousands of keywords, generate misspellings and synonyms, actively manage your keyword bids, and measure the effectiveness of your landing pages. As these tools have come into the market, search marketing has become much more competitive—and higher ROIs more difficult to obtain.

The saturation of search marketing makes finding new and effective methods of online marketing very desirable. How much of your marketing budget would you spend if you knew your customer acquisition costs would be 20-50% less than a traditional search engine?

Enter Facebook, the second most popular website on the Internet, after Google. The social networking site is home to more than 500 million users who spend more than 700 billion minutes per month on the site and share more than 30 billion pieces of content. One criticism of Facebook is that it is a place to hang out, not to buy. But because lead generation works by capturing potential customers further up in the buying cycle, Facebook can be a solid source of potential leads.

The following are some of our best practice principles on how to manage your Facebook campaigns:

1. Understand that Facebook is different than paid search.

Facebook advertising follows a pay-per-click approach, similar to advertising on Google, Yahoo and Bing. Advertisers are charged when a user clicks on a Facebook ad and visits their site. This direct marketing approach is very attractive; however, there are some major differences between this approach and a typical paid search advertisement. Because of the social nature of the website, potential customers on Facebook aren't actively seeking your services. This results in a much lower click-through rate and potentially lower conversion rates.

A second difference is that in Facebook, keywords are not based on search queries but rather on information users list in their Facebook profiles, such as activities, favorite books, TV shows, movies, etc. Facebook advertisers need to think through carefully the keywords they want to use and can't just copy over a successful search campaign.

2. Understand your target audience.

360Partners recommends having a clear understanding of who you are trying to reach. The search engines allow control of advertising to the basic demographics of your potential customers. What sets Facebook apart from these engines is the option to target based on psychographics. Psychographics are attributes relating to the personality, values and interests of a person. An important question to ask is this, "What Facebook groups would my target audience join?"

For example, suppose my business provides software for people whose passion is creating photo books and scrapbooks. In this case, we recommend targeting keywords such as "scrapbooking" and "photo booking." So the ads for my business would then only be visible to those who have identified themselves as having interests in these keywords.

3. Employ a variety of ad images.

Users tend to use Facebook frequently (Facebook itself reports that 50% of its active users log on to Facebook in any given day), so these users become accustomed to the same image quickly and "image fatigue" can set in before you know it. 360Partners recommends using a variety of ad images and replacing these images frequently. It's important to keep your images fresh, unique and interesting.

The chart below shows two campaigns inside of Facebook and the number of clicks over the course of seven days. At the beginning of the week, you'll notice that clicks were fairly stale. On Wednesday of that week, 360Partners swapped out the visual images and immediately, clicks increased. As a result, lead volume also increased.

4. Use people in your display images.

One of the most interactive features of Facebook involves the billions of photos uploaded to the site each month. It's called Facebook for a reason; users expect to see images of their friends. 360Partners recommends using images of people in your Facebook ads. These images should sell your value proposition and invite users to learn more about your product or service.

Using my scrapbooking example again, an image of the target audience that tells a positive story about the product sells the value proposition to potential customers.

5. Measure conversion towards performance goals.

The key to success on Facebook or any other form of online marketing is to begin with the end in mind—your customers. And of course, measuring performance is the easiest way to improve performance. Earlier this year, Facebook released a beta conversion tracking script. 360Partners recommends installing these scripts and measuring performance as granularly as possible, and using them to determine what actions you need to take to optimize your account.

Case Study

360Partners has a client in the highly competitive online education industry. This company is looking to recruit new students into one of their online education programs. The first step in the process of acquiring new students is identifying prospective students online and getting them to request an application. Pay per click search marketing had been this client's primary means of getting prospective students to request an application. The average cost per click for this client ranges between $3 and $7 with about 10–15% of the prospective students requesting an application. (This results in a cost per application around $40.)

360Partners started a heavily targeted Facebook campaign for this client. The average cost per click for these campaigns was around $1 and resulted in a cost per application of $12.80. For this client, advertising in Facebook is a great channel to deliver additional volume and value to their program.

If you're looking to grow your lead flow and think Facebook might be a viable channel for you, we'd love to talk. If you'd like a free consultation about how best to start with Facebook, contact us today at searchmarketing@360partners.com.

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Mike Craig is an account manager at 360Partners.

Marketing Watchdog Journal is a monthly newsletter from Bulldog Solutions, an online marketing agency that changes the way BtoB companies define demand-generation strategy, engage prospects and convert leads to customers. We welcome your feedback on this newsletter's content and design, and encourage you to share your ideas for topics you would like us to cover in future issues. Please send your comments or questions about Bulldog Solutions to Amy Bills, director of Field Marketing.