In today’s economy, social media marketing is critical, especially on Facebook. Many businesses and entrepreneurs are over eager to get started, and they jump in the deep end, before ever learning how to swim. Marketing on Facebook is an art form, and must be done carefully and methodically.
The easiest place to start is with Facebook Pay-Per-Click Advertising, you only get charged when someone clicks on your ad. Facebook’s pay-per-click service is one of the best available because you can target exact geographical areas and people. Facebook pay-per-click even tracks likes and interests.
Some people believe that the more clicks you receive the better the value. To advertise effectively on Facebook you must first determine your target market. Otherwise the clicks you receive may be useless. Once you have determined your audience, you are ready to begin Facebook marketing. Let me share with you an example of how targeting can affect your business.
Let’s say I start a new business called Karl’s Kars, and I am based in American Fork, Utah. I want to grow my customer base, so I choose to use Facebook PPC to accomplish this. My marketing budget is small, but I decide that I want to milk it for every penny. I set up an advertising campaign, targeting everyone on Facebook, and I hit the go button. I could probably achieve the coveted 1¢ clicks, but the majority of the traffic is coming from foreign countries, other states, everywhere except for American Fork, Utah.
In most situations, cheap clicks are bad! Sure you can get lots of traffic, but maybe less than 1% of 1% may actually have the potential to become a customer. You must be willing to put in some money into your Facebook marketing, and more importantly the time to do it correctly, otherwise you may as well just be burning your money.
There are two critical factors to take into account when determining what your marketing budget should be:
- Cost Per Customer
- How much do you have to put into marketing to turn a lead into a customer?
- Very simple formula: Total marketing spend / total customers received = CPC
- Customer Lifetime Value
- How much is each customer worth to your business?
- Very simple formula: Total revenue earned / total number of customers = CLV
Without these 2 numbers, you can’t have successful marketing campaigns, because you don’t know where your point of profitability is. If my CPC is $100 and my CLV is $675, then that is a great return on my investment. However if the numbers were switched, then it’s time to reevaluate what you are doing.
With my CPC in hand, it’s time to start marketing, but going about it wisely.
Who is your target market?
Targeting is key with Facebook marketing. Let’s go back to my example earlier of Karl’s Kars in American Fork, Utah. This time, instead of targeting everyone, I am only going to target people in American Fork, and the surrounding cities. But I can get even deeper. Is my target market college students? Working professionals? Stay at home moms? What education level? Male or female? This is the beauty of Facebook marketing.
You want to get as specific as possible, and you must accept the fact that these clicks will cost on average anywhere from $0.15 to $15.00. The other thing to check for is what the projected target audience is. For local businesses the sweet spot is anywhere from 2,000 to 10,000 people. This will give you a higher return on your investment, and better chances of converting your new leads into customers.
With these practices, you should start to see a dramatic change in your Facebook marketing results.