Is Facebook Advertising Worth It in 2020?
It is a well-known fact that Facebook advertising statistics are constantly changing due to the illusive algorithm patterns running behind the scenes, however, it cannot be argued that Facebook is one of the most impactful social media platforms for your small to medium size business. Not only is Facebook advertising effective and affordable, but it allows you to reach new audiences that you may not otherwise have access to. The site boasts a potential reach of 1.9 billion people, no other social network comes close to Facebook’s market penetration. And with the average person spending more than 40 minutes a day on this social platform, what business can afford to leave Facebook advertising out of their advertising and marketing budget?
The days of organic growth alone have long since passed on Facebook (branded Facebook pages only reach about 2% of fans with organic posts), this is a pay-to-play platform. 67% of social advertisers consider Facebook to be the most effective social media platform they use making it a key component to any successful marketing strategy. Although advertisers have many elements to consider when launching a new online advertising campaign, from potential reach to ad creative, oftentimes it comes down to cold, hard numbers. Fortunately, Facebook is one of the most cost-effective advertising platforms available. Although it is important to remain mindful that there is a variety of ad formats to choose from and the ultimate return on investment depends greatly on the ad format chosen. It’s also worth noting that although the cost of Facebook ads have continued to rise in recent times, overall costs remain significantly lower in many cases than similar metrics in pay per click. Concern surrounding the affordability of Facebook Ads is to be expected, but most business owners who weigh the cost of acquiring new customers against their lifetime value will most likely find that they are still getting their money’s worth.
So, does Facebook advertising actually work?
WordStream’s social expert Brett McHale has weighed in on the debate on whether or not Facebook advertising is worth it in 2020 and he advises, “When it comes to Facebook adverting, it’s important to take the metrics that are available and reapply them to your end goal, take Relevance Score and click through rate, for example. These two metrics are held in high regard because they are both interrelated, but if your goal is lead generation, they become substantially less important.” By carefully monitoring his Facebook campaigns, Brett successfully achieved Relevance Scores of between 7 and 9, significantly higher than the Facebook average, as well as click-through rates of between 4–5%, also much higher than the average campaign. Although this was a win in itself, he wasn’t hitting the conversion number goal he had set so Brett went back to the drawing board. He decided to redirect his focus back to the central value proposition and let the ads run to the desired audiences. Although there was a drop in relevance score and click through rate he was yielding far more conversions when following this method. The takeaway here is to decide what your end goal is and work backwards from there. This is more easily done with a Facebook advertising agency who work to assist small and medium sized businesses in reaching their marketing and advertising KPIs and boost business growth.
For those who still have reservations regarding the utility and effectiveness of Facebook advertising, it is worth mentioning that overall Facebook is one of the cheapest (if not the cheapest) forms of advertising available. Facebook gives advertisers the freedom to spend however much they want on their ads. Business owners set their budget from the start and Facebook will stop showing the ad when the allotted budget is reached. Simply put, the higher the budget, the more Facebook users a business can expect to reach. Also, Facebook defines ad cost two ways — the overall amount spent (controlled through your budget) and the cost of each result you get (managed through your bid strategy).
In order to keep businesses abreast of their spending and ensure they don’t unexpectedly go over budget, Facebook offers two ad limit methods: campaign spending limit (this is to set a maximum ad amount you are willing to spend on a given Facebook ad campaign) and account spending limit (this is to assign a maximum ad amount you are willing to spend across all the Facebook ad campaigns you are running).
What’s more, choosing to advertise with Facebook allows for round the clock access to the metrics and analytics behind a businesses’ ad campaigns so the campaign’s success is easily accessible and measurable.
Facebook advertising is also incredibly versatile, though many businesses incorrectly assume that Facebook advertising is only beneficial for retailers and other brands that sell directly to consumers, this does not seem to be the case. A Social Media Marketing Industry Report developed in 2019 shows that 72% of B2C marketers reported that Facebook was their top social advertising channel. While 43% of B2B marketers also named Facebook as their most important advertising channel, passing LinkedIn. CNBC reported that Facebook earnings are about 1.9 times higher in 1st quarter of 2019 compared to the 1st quarter of 2017. This illustrates just how many businesses rely on Facebook advertising to reach and engage their target buyers and this is expected to grow further right to the end of 2020.
In Conclusion, if a business campaigns are not performing effectively it’s time to go back to basics and re-examine the marketing strategy (including KPIs and target audience). Once all this is established, work backwards from your end goal using the appropriate methodologies.
There are no shortage of benefits for advertising on Facebook especially if you are a small to medium sized business owner. From advanced targeting (and retargeting) capabilities to cost-effective advertising which can significantly boost on and offline sales, it’s no coincidence that so many businesses are using Facebook advertising in 2020.
