An Introduction to Facebook Ads for Ecommerce

Facebook has over a billion monthly active users according to Statista. With Facebook ads, you have the opportunity to put your business and product in front of this very large and active user base. Many ecommerce businesses have been able to make the most of this opportunity and have grown their businesses significantly with Facebook ads. Online retailers such as Pigtails and Ponys, a hair accessories brand, and Joseph Nogucci, a designer jewelry brand, have had and continue to have a lot of success with Facebook ads. 70% of Pigtails and Ponys’ customer base has been acquired through Facebook ads and Joseph Nogucci has seen a 7x return on their ad spend.

When you think of Facebook ads for your ecommerce business, maybe you begin to wonder if it’s too expensive, if it’s too difficult to figure out, or if it’s still too early for your business to pay for advertising.

In this article, I’m going to go through the basics and fundamentals of Facebook ads and provide you with an overview of the platform. In a future article, I’ll walk you through, step-by-step, how to create your first ad. For now, let’s dive into the world of Facebook ads and what they look like for ecommerce businesses.

 

Who Can Create Ads?

Anyone with a Facebook account. To get the most out of Facebook ads, I suggest creating or having a Facebook Page that you can attach to your ads. This will give you more options in terms of placement and ad type when creating your ad.

Why Your Business Should Consider Facebook Ads

The reason so many marketers love Facebook is because of how highly specific you can get with your ad targeting. Because Facebook collects so much detailed and unique information from its users, if you wanted to, for example, sell steel toe boots, you can target a 33 year old construction worker in Wyoming, who likes Caterpillar Inc’s Facebook page.

With each ad you create, you can choose how much you want to bid to have your ad shown to your target audience as well as if you want to bid on the cost per click (CPC) on your ad or on the cost per 1000 impressions (CPM).

To give you an idea of what you might pay, Statista reports that in Q3 of 2014, ecommerce businesses saw an average cost per click of $0.49 on Facebook. You also have complete control over your max bid, budget per day and total budget for your campaign. You can start testing ads for as low as a $1 a day to measure the kind of engagement you get before pouring more of your advertising budget into Facebook ads.

Lastly, as mentioned in the beginning of this article, many ecommerce businesses are already finding success with Facebook advertising. MVMT Watches had a 3x lower cost per acquisition on Facebook compared to other advertising channels and Bestowed, a healthy food delivery subscription service, had a 5x return on ad spend and increased their website traffic by 30% with Facebook ads.

The first part of Facebook advertising is deciding where you want your ads to be shown. You can choose to display your business’ promotion in different places on Facebook, or even across all of them.

via Facebook

Looking at the graphic above, from left to right, we have mobile ads and desktop ads which  allow for sidebar ads and news feed ads.

Mobile ads, which show ads in the news feed of mobile users, tend have a higher clickthrough rate than desktop ads. Qwaya saw a 3x increase on their CTR in their mobile ads versus desktop ads.

While this information is valuable, it also means you need to ensure your website is mobile-friendly. Fortunately, if you’re using Shopify, all Shopify themes are responsive and provide a mobile-friendly checkout experience.

Desktop ads have two different placement options. The first is the sidebar. The sidebar allows you to display an ad without being required to have a Facebook page.

The other placement option is in the news feed. According to AdEspresso, the news feed gets more engagement than sidebar ad placements, however creating a news feed ad requires you to have a Facebook page.

Lastly, Facebook rolled out their audience network last year which allowed advertisers to place ads in mobile apps.

Types of Facebook Ads

There are many different kinds of Facebook ad types but let’s look at the ones that, as an ecommerce business owner, make the most sense and will likely be the most helpful. Also note that the ad types I talk about are for the mobile and desktop news feed. Sidebar ads will not allow for the elements talked about below since sidebar ads are more restrictive as they don’t require you to have a Facebook page.

Page Post Ads

These are ads that require a Facebook page to create. These ads are essentially just like photo or link posts you can create like a status update for your Facebook page.

Multi-Product/Carousel Ads

These ads allow you to advertise multiple products within one ad. This is useful when you want to show off your catalogue or display different variations of your product.

Page Post Video Ad

Video ads auto-play play muted until the Facebook user taps the video to unmute the audio.

With each of the above ad types, you can choose an objective. This is what Facebook will try to optimize your ad for by showing your ad to users who are most likely to take your desired action. At the time of writing this article, there are 11 different Ad Objectives. You likely won’t use most of them for your ecommerce business, but let’s quickly dive into each one.

• Clicks to Website - Pay each time someone clicks your ad and visits your website.
• Website Conversions - Pay for each conversion on your website. This is tracked with a “conversion pixel”, a snippet of code that is placed on the goal page – for an ecommerce businesses, this would be the order confirmation / thank you page. When a Facebook user reaches that page (for example, after checking out or purchasing a product) it is recorded as a conversion in Facebook.
• Page Post Engagement - Pay for the engagement your post gets such as likes, comments, and shares.
• Page Likes - Pay to increase the amount of Likes your page has.
• App Installs - Pay for each installation of your desktop or mobile app.
• App Engagement - Pay when users interact with a specific part of your app.
• Offer Claims - Pay to promote a discount or deal for your store.
• Local Awareness - Pay to show your ad to users near you.
• Event Responses - Pay to promote an event on Facebook.
• Video Views - Pay to promote a video based on views.
• Dynamic Product Ads - Pay to promote relevant products to users that have already browsed your ecommerce website.

US-based Shopify merchants can also use Facebook’s “Buy” call-to-action button. The buy button allows consumers to easily purchase items they see on their News Feed or on Pages without leaving Facebook.  

Regardless of the ad objective you choose, you’ll still pay for any Likes, Shares, Comments, and any other kind of engagement your ads receives. However, as mentioned earlier, depending on the objective you select for your ad, Facebook will optimize your ad and show it to users who are more likely to perform the action you desire.

What’s Your Goal?

Selecting and creating the right ad type is based on what you want to achieve with your Facebook ad. If you want to create an ad that generates purchases or email sign-ups, then ‘website conversions’ are a good objective for your ad. If you just want more Likes on your Facebook page, then creating an ad for ‘page likes’ is your best bet.

Of course, every ecommerce business owner’s ultimate advertising objective is to drive sales on their website, however, there’s no “one” ad type that will guarantee this. Every business is different and each business’ customers are different, meaning you should explore each ad type and objective and keep a close eye on your competitors on Facebook to see what kind of ads they run.

What Kind of Facebook Users Do You Want to Reach?

Facebook has an array of options when it comes to selecting your target audience. Most of the options provide further detailed options for targeting Facebook users. I encourage you to play around with each option to fully see what’s available to you in terms of targeting your ad. On Facebook, you can target users based on:

• Location
• Age
• Gender
• Language
• Relationship
• Education
• Work
• Ethnic Affinity
• Generation
• Parents
• Politics
• Life Events
• Interests
• Behaviors
• Connections

To get a better understanding of all of these targeting options, read Facebook’s documentation about audience targeting.

For more advanced advertisers, you can create what Facebook calls  “custom audiences”. Using things like your email list or a retargeting pixel allows you to target or even exclude a very specific audience in your ads.

Social Media Examiner suggests creating a separate ad for each interest/topic. So, instead of inputting four different interests in your target audience for your one ad, create four different ads  for each interest you wish to target. This way, you can see which interest performs the best for your ads. For example, if you were selling guitar straps, create an Ad Set targeting users with Gibson Les Paul as their interest, another Ad Set targeting users with Fender Stratocaster, another Ad Set targeting users with Gibson SG as their interest, etc.

Your First Ad

There are three different ways to create your ad: right from  your Facebook page, using the Ads Manager and using the Power Editor.

From within your page, you can choose to boost posts you’ve made (to reach Facebook users outside of those that like your page, or reach more of your fans) or even boost your page for more likes.

To create an ad, one way is through the Ads Manager. This is the method most users start with. It’s easier to follow along and the process is a little more straight forward than the using the more advanced Power Editor.

The Power Editor, which is what I suggest using, has a bit of a learning curve (not much) but has more features than the Ads Manager. Learning to use the Power Editor to create ads will make it easier for you down the road to quickly and easily split test ads, bulk create ads, run ads for different audiences, and run ads for different budgets. The Power Editor also receives advertising features before they are released in the Ads Manager.

When you create an ad, each ad is put into three subgroups: Campaigns, Ad Sets and Ads. Campaigns are the overall groups for your ads, which contain subgroups known as Ad Sets. Each Ad Set can contain different ads.

Each group and sub-group allows you to set and change different aspects of your ad campaign. So changing the objective of a Campaign will do that for all your ads within the campaign. Changing the budget of an Ad Set will change the budget of all the ads within that Ad Set.

Here’s a breakdown of the ad components you can manage within each group:

Creating Your Ad

A easy and quick way to start is with a page post ad that tracks website conversions by placing the conversion tracking pixel on your checkout page. Page post ads don’t require a lot of setup like a multi-product ad and they don’t require a lot of time producing the creative for your ad like with a video ad. Of course, you’ll want to test those ad types as well but to get started, a page post ad in the news feed is a great starting point.

When deciding on the objective, according to Kissmetrics, Facebook ads that use a low-friction conversion, generally perform a lot better. For example, asking a Facebook user to signup for an email list is a lot easier and will likely yield more conversions than asking a user to buy. Getting the email first, then using rapport and relationship building to eventually ask for the sale, can work better. This means you should consider other ad types besides only direct selling on Facebook.

As a quick tip when coming up with the copy and images for your ad, try to match the copy and image of the ad to the copy and images on your landing page. WhichTestWon saw an increase in conversions by 115% when the copy of the ad matched the copy on the landing page.

Ad Approval and Ad Guidelines

Before submitting your ad to Facebook, ensure you go over Facebook’s advertising guidelines to ensure your ad doesn’t break any rules, which will make the approval process as smooth as possible.

One quick thing to consider is the amount of text you can place on the image for your ad. Facebook only allows 20% of your ad image to contain text. Use Facebook’s grid tool to help you determine whether or not your image has more than 20% text.

Once you submit an ad to Facebook, it goes through an approval process. Facebook is usually very quick to approve ads. It could be approved anywhere between a few minutes to a few hours. If it’s your very first ad, it might take a little longer to get the ad approved. You will get an email and Facebook notification once the ad has been approved.

If you’re struggling to get your ad approved, you can contact Facebook’s support in regards to ad approvals.

Facebook Ad Reports

Once your ad is approved and running, it’s important to monitor your ad to ensure it is performing well. Go to the Ads Manager and click on your ad to get a more detailed report. You can view the on-going and past report of any ad regardless or where you created it.

Some important metrics to keep track of and compare among your ads are:

• Conversions: How many users performed your desired action.
• Reach: How many Facebook users have seen your ad. (not to be confused with impressions, which is the total number of times your ad has been seen)
• Cost: Usually measured in cost per action. This will give you an idea of how much you are spending to get Facebook users to perform your desired action.
• Frequency: The amount of times, on average, your ad is shown to a user.
• Click-Through Rate: The percentage of users that click your ad. The higher, the better.

If you’re wondering “what’s a good click-through rate?” or “what’s a good X?” it depends and there isn’t really a benchmark you should be trying to meet. Use these metrics to compare your ads. If one ad has a significantly higher CTR (Click-Through Rate) than another, it might be time to pause the under performing ad to save you money.

You can also edit ads in the Ads Manager as well as pause or delete any ads.

Your Turn

If you feel like Facebook ads are the next logical step to your ecommerce business, and you’ve been itching to try them out, give it a shot. Remember that you can set a budget as low as you want it to be but also remember to have realistic expectations and experiment with your ads.

If you have any questions about setting up your very first Facebook ad or you need me to clarify a step or process mentioned in this article, feel free to leave a comment below. I engage and respond to everyone.

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Curated from Shopify Blog
By Corey Ferreira, July 20th, 2015