“The best Facebook ads look and feel as relevant and timely in your News Feed as the posts you see from your friends.” – Mari Smith
If you are operating a small business, you’re probably on Facebook. There are currently more than 50 million small businesses leveraging Facebook Pages. And for good reason. Facebook is a ubiquitous staple of modern culture. It has literally become a household name all across the world, not to mention it gives savvy businesses the potential to reach more than 1.5 billion individuals.
Recently, Facebook announced that more than three million businesses advertise on its platform; many of which are small- to medium-sized businesses, or SMBs. And this number is growing rapidly. In February of 2015, Facebook only had two million advertisers. For those keeping score, that’s a 50 percent increase in a single year.
To give you perspective, Twitter caters to around 130,000 promoters leveraging its ads, and Instagram, which recently hopped into the ad business, has approximately 200,000.
Facebook is keenly aware just how much small businesses rely on its offering. , Facebook chief operating officer Sheryl Sandberg has commented on the matter stating, “Our mission is to connect the world, and connecting people to small businesses that provide their local business services is really an important part of that mission.”
But why exactly are small businesses flocking to the omnipresent Facebook for their advertising needs, as opposed to the various other social platforms that legions of individuals use daily? Is it really better than Google AdWords, or the gazillion other ad outlets? Let’s find out.
The Most Bang for Your Buck
Many small business are operating under extremely tight financial constraints which leaves little room for a marketing budget. The funds that are allocated for advertising are probably only large enough for more traditional promotional avenues like newspaper ads, late night television spots, radio ads, and so forth. The problem with these forms of advertising, however, is that the audience these materials reach is extremely limited, and dwindling by the day.
Today, SMBs are pouring their limited marketing dollars into digital properties rather than traditional media. A 2015 research paper from Borrell Associates showed that 56 percent of the businesses surveyed are sinking cash into digital ads; twice the amount of spending on radio and four times more than those advertising on local TV. Part of the motivation is obviously reach; these types of ads have a much more expansive and diverse demographic. More importantly, however, is that digital advertising is capable of targeting specific audiences and provides feedback on how effective the ads actually are. By contrast, old school advertising is incredibly difficult to measure.
When it comes to Facebook, the social portal is providing small businesses with high-end tools that otherwise would simply be unaffordable. As Sandberg said, “It’s prohibitively expensive for most small businesses to reach people digitally.”
With Facebook, small businesses can create a variety of different ads and experiment to see which convert the most for a selected audience. Additionally, individuals can be targeted based on age, location, interests, gender, and so much more. This allows for SMBs to really get down to the nitty-gritty of its target audience and reach those exact individuals while simultaneously eliminating unnecessary ad spending on those who will never convert. More than that, once an audience who converts highly has been identified, clone audiences can be created to do more of the same.
All of this feedback gives small businesses the capability of understanding exactly how far their dollars are going, and how to get them to stretch even further. This is part of Facebook’s goal; to create the ultimate ad platform for SMBs as these folks are the future and lifeblood of Facebook’s ad revenue.
Revenue from Mobile
At this point, everyone understands that mobile plays a massive role in the future of digital media and advertising. More than 80 percent of Facebook’s total ad revenue comes from mobile devices. This figure is only set to increase as the company recently announced a new form of mobile ads dubbed Canvas Ads.
Today, mobile is one of Facebook’s main drivers — its app is the most popular of all time. Additionally, Facebook Messenger has been adopted by more than one billion individuals; making it the second most popular app of all time. And as a society, more people are spending the bulk of their time online in-app than anywhere else.
As far as Facebook ads are concerned, more than one million of the three million advertisers present on the platform generated an ad through mobile. Facebook vice-president of small business Dan Levy commented on mobile’s power by stating, “Mobile has really enabled so much of this growth, especially outside of the United States where so many people just start on a mobile device.”
But Facebook has not only given small businesses a means to grow their bottom line and brand awareness through advertising; it has become a one-stop-shop for everything from engagement, to revenue, and virtually anything else needed for an SMB to operate online. According to a joint study conducted by Wells Fargo and Gallop, close to half of the small businesses operating in the United States do not possess a website, however, 69 percent of these companies have used social media to advertise. This, combined with the array of business tools that Facebook provides, has almost made having a website obsolete for smaller entities. Everything from reviews to content, sales, customer service, and more can all be handled directly through Facebook.
In the era of social media, Facebook is the belle of the ball. Its pages act as miniature storefronts while its advertising capabilities are highly sophisticated, have unparalleled reach, and come at a fraction of the cost when compared with many others. If your business is not already running ad campaigns through the social portal, it’s time to rev up the marketing machine. Facebook ads can help your business grow immensely for very little money; you just have to be willing to put in the time and effort.
Do you think that Facebook Pages could truly make operating a website obsolete for SMBs? What are your thoughts on Facebook’s new Canvas Ads?