Have you started getting annoyed with the performance of your Facebook ads? You aren’t alone. This is a common complaint among e-commerce marketers I have spoken with. Don’t worry – Facebook shared some great news just in time for Christmas! They have started offering in their own search marketing ads.
The ads will be limited at first, but Facebook should eventually start expanding them. Initially, these ads will be restricted to select businesses in the e-commerce, automotive and retail sectors. E-commerce businesses that meet the eligibility criteria will benefit from the lower CPM from having less competition until Facebook begins expanding the ads to new marketers.
Some people are skeptical that these ads will work, especially since Facebook stopped offering them in the past. However, Debra Williamson of AdAge wrote a post discussing the benefits.
“Can Facebook be as good as, or even replace, paid search for some ad objectives? It may sound crazy, but the answer is yes. And the twist is that Facebook doesn’t need to have a full-fledged paid search business — or even be a search engine — to do it… But Facebook has managed, through the creation of smart ad products that fulfill similar objectives that paid search does, to start gaining significant business from search advertisers. And there’s likely more to come.”
Advertisers should be aware of these new ad opportunities and try to take advantage of them.
E-commerce marketers should welcome the new ad offerings
Many e-commerce marketers have found that the ROI of their Facebook advertising campaigns has stagnated recently. Facebook tried giving advertisers the opportunity to show their ads in different parts of the site but was forced to pull back a bit due to user complaints. This meant that a growing number of e-commerce advertisers were competing for the same placements in the sidebar and newsfeed. As marketers became frustrated with their limited options and the rising cost of advertising on Facebook, Facebook advertising revenue began to stagnate.
This created a number of issues for marketers. CPM rates increased as those placements became more saturated. Campaigns also started to burn out more quickly, since users had seen so many similar offers and were no longer as interested.
The new search ads will likely address a number of these issues. Here are some of the main benefits they offer.
You should have a lower advertising burnout rate
When you advertise in the newsfeed or purchase sidebar ad inventory, your ads will be seen the same users again and again. You can try to minimize the risk of your campaigns burning out setting lower frequency caps, but your ROI might suffer as a result. According to data from Facebook, reducing the frequency cap from three impressions a week to 0.5 impressions a week reduces buyer intent from 80% to 40%. Of course, even with the lowest possible frequency cap, your ads will still likely burn out eventually. Unlike targeting specific web pages with PPV ad campaigns, people use Facebook on a regular basis. It is almost a guarantee that they will see your ad every week even with a very low-frequency cap. This might help reinforce your branding message in the short term with a branding campaign, but it will eventually start to see diminishing returns and no longer be worth the investment. If you are running a performance marketing campaign, your ROI will plummet even faster.
This is not likely to be nearly as big of a concern with Facebook‘s new search ad inventory. People will only see your advertisements after searching for keywords that you target, which should obviously be closely related to your offer. It is highly unlikely that they will be searching for the same things all the time, so your search ads will not burn out nearly as quickly.
You can reach users with a higher level of buyer intent
When you are promoting e-commerce offers on Facebook, you will often be interested in getting sales. Contrast this with local businesses and nationwide companies that usually are more interested in branding.
Since you are more focused on generating sales from your Facebook campaigns, it is important to target people with a high level of buyer intent. You can use a customer analytics record to figure out what types of keywords will best relate to your audience and focus on them. This is tricky on Facebook because you are restricted to targeting people based on their demographics and the types of pages they are following. Although Facebook has a number of excellent targeting options, choosing the right demographics alone won’t help you reach people based on user intent and people also often follow Facebook pages and groups that they subscribed to years earlier.
The search ad inventory should make it a lot easier to reach users that are specifically interested in buying a product or service. You can get your ad right in front of them as soon as they search for something related, so they will be in the mindset where they want to click it and consider making a purchase.
You can have a more engaged conversion funnel
Creating a seamless conversion funnel is essential for any marketing strategy. You need to invest in a lot of resources, which include optimizing your landing page, outsourcing important engagement functions and following up with new buyers. You can run into issues with this when you are working with customers with low engagement rates, which can cause you to question the benefits of your conversion funnel. When you use search ads that are finely targeted, you can see better engagement data and have more confidence in your conversion funnel.
CPC rates should be low for niche campaigns
Marketers that purchase traditional Facebook ads are frequently competing with brands in unrelated industries. Let’s say that one Facebook user is a female that recently graduated from college and is planning her wedding. Advertisers offering student loan reduction services might be competing for the same ad space with her as companies that offer bridal services.
This won’t be such an issue with advertisers using the search inventory on Facebook. They will be targeting people searching for specific keywords. This means that there is going to be much less overlap between non-competing brands, which should likely keep advertising costs lower. Of course, the costs will be higher for competitive industries, such as weight loss and debt reduction. However, other industries may be able to get very inexpensive ads.
What are the possible drawbacks of the new Facebook search ad offerings?
E-commerce brands should be ecstatic that Facebook is giving them the opportunity to reach users through its new search ads. However, there are also some drawbacks that they need to be aware of. Take some time to familiarize yourself with the limitations listed below.
You can only advertise to users in the United States
The biggest drawback of the new ad inventory is that it is only available to marketers trying to reach users in the United States. This is a frustration for e-commerce companies that primarily serve customers abroad or have started focusing on penetrating markets in new regions after exhausting the market share in the United States. Since the advertising opportunities are limited to this region, it is possible that CPM rates will rise faster than they otherwise would, because advertisers will have to focus exclusively on scaling their presence in the United States.
Facebook‘s keyword targeting strategy might not work perfectly at first
Facebook offered search adds to its users In the past, but discontinued them. It is not entirely clear why those ads were halted, but it is possible that there were technical issues that made it difficult for users to engage with them properly.
There could be some hiccups with the new advertising options when they are first launched. Advertisers might need to test them a bit before figuring out how to make sure their advertisements appear to the right audience.
One issue is that adds might show up when people are using unrelated search terms that happened to include one word of a longer phrase that the advertiser is targeting. This might mean that the ROI will be lower for advertisers targeting broader phrases, so they may need to go after one-word terms that are more tightly related.
Again, this is pure speculation at this point. However, most new advertising products require tweaking before they worked flawlessly. The good news is that the lower CPM might offset any poor conversion rates due to technical issues.
The ads may not be available for your industry
Facebook is still testing the waters with these search ads. If they take off, they will likely expand them to new regions and industries. However, for the time being, they are heavily restricted to certain types of businesses.
Facebook hasn’t given a lot of guidance yet. They have simply stated the ads are available to certain automotive, retail and e-commerce businesses. It is likely that some e-commerce businesses won’t be eligible, although the specific approval criteria has not yet been released. They will probably be stricter than they are with their current prohibited content policy, but this remains to be seen.
Facebook search ads could be a great investment, but there will be a learning curve
Facebook is always offering new ad products to reach more people. This is a great opportunity for e-commerce companies that want to scale their campaigns, but they will need to test them and see what works.