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Do Facebook Ads Work?

Do Facebook Ads Work?

The nice part about Facebook ads is that you can target users based on what they like and demographics which makes it easier to  find your ideal prospects.  This is unique to Facebook, as you can’t target ads based on who is viewing the web page with most advertising options – only based on the content being viewed or what someone searched for.  Since Facebook knows what a user likes and their personal info, they can show ads based on that to a person – increasing the chances the ad will be relevant to them.  Most other sites don’t have near as much data on the person viewing a web page.

With that said the real questions is, do Facebook Ads work?  According to a report from Nanigans, an ad platform geared towards optimizing return on investment (ROI), the answer is a resounding yes, Facebook ads work .  They found that the average ROI on Facebook ads was 152%, a 4x increase from last year.  Another finding was that the average cost per click for a Facebook ad fell from last year, from $0.62 (2012) to $.045 – no doubt a big factor in the increase in ROI.

While the cost for advertising on Facebook dropped, the number of registered users continues to grow, albeit at a slowing pace from prior years.  Furthermore, the number of monthly active users for Facebook, at 1.15 billion, dominates other social networks (Google+ is second with 359  million).

The more users that they add, the more likely it is that you’re able to reach a significant amount of Facebook users for smaller niches boosting your ROI even higher.  For example, say you’re a new coffee shop and you want to advertise on Facebook to generate more customers.  You can target users living in the zip code your coffee shop resides in and who like coffee.  You can also target people who like some of the neighboring businesses around you because they are likely to shop in your area.  However, there’s a good chance that people liking those businesses (unless maybe they’re major chains) are small.  As Facebook continues to grow those tighter niches (i.e. customers who like multiple small businesses around you) will become greater.  The increasing precision which you can target your potential customers make you Facebook ad campaigns all the more profitable.

For more on the growth of not only Facebook, but other social networks as well, check out this infographic from Search Engine Journal;

growth-of-social-media-2013

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