Facebook Ads & Local businesses

With over 2,41 billion monthly active users, Facebook is perhaps the platform in which your customers spend most of their time. Actually, 1 in each 5 minutes in mobile devices are spent in Facebook , without even mentioning all other Facebook properties like Instagram, Messenger and WhatsApp. While all these services are free, the truth is that we pay with our time and personal data in exchange.

Personal data such like your birth date, e-mail address, phone number, ZIP code and the whole list of all your friends, among other information, are more valuable for Facebook than any monthly subscription. In one hand, most of the users use the service because it’s free. On the other hand, when you put together the information mentioned above with your interests and behaviors, like all pages, groups and posts you’ve engaged with, and your online activity being measured by tools like the Facebook Pixel, the SDK and the Facebook Login in Mobile Apps, probably no other Internet company is able to have such a complete profile of all their users (perhaps only Amazon and Google).

That’s why you see ads of websites or apps you’ve used recently, because Facebook has access to that information. Actually, most of the people are not aware but in your profile settings you can find your ad preferences, an see some of the information related to interests related to you. Or advertisers that have included you in their campaigns.

This is the reason why advertisers pay Facebook, to have access to audiences based in interests, behaviors and very precise demographic information on age, gender and region. Say you are a fast-food local business based in the downtown of Sao Paulo city, and you are willing to reach new customers. Due to Facebook knowledge in its users, it’s possible to find people in specific neighborhoods close to us, users interested in hamburgers, pizza, burritos and brands like Pizza Hut or McDonald’s.

The auction

By having access to this audience, it will be possible to deliver ads and we will be charged, for example, every time our ad generates an impression (CPM) or a click (CPC). In other words, if our ad was shown, an impression will be counted, and we will be charged, regardless if user paid attention (or not).

“An ad impression is counted the instant any part of the ad appears on the user’s screen”.

Facebook Description of Methodology

Or if a user clicked on our ad, we would be charged as well. We can choose if being charged by impressions (CPM) or by clicks (CPC). Then, the most budget your campaign has more access to inventory of impressions, clicks or whatever action you are willing to get, from the audience you are trying to reach.

While it may seem simple the way it works, the truth is that this process happens millions of times a day and takes into account if your ad is providing a good user experience. Is people engaging with your ad? Are they clicking? Or if it’s a video, are they watching the whole video? While this happens, all Facebook and Instagram advertisers are participating in real-time auctions taking all this into account. In this scenario, the one bidding higher will get its ad served once. And then the process starts over again.

While this is true for advertisers participating in the auction, we must take into account that it’s also possible to buy in advance by using the reach and frequency method, in which you can set how many people you want to reach and how many times you want them to see your ads in certain amount of time (1 time each 14 days), and know how much it will cost from before.

As you can see, Facebook provides a whole platform for advertisers to find an audience with high chance of being interested in our product and smart enough to deliver our ads to a very specific audience, even neighborhoods, addresses and ZIP codes.

The objectives

While finding an audience and delivering our ad is just one part of the process, other important part of the process is choosing the right objective to work with. This time, I will mention three of the objectives that local businesses can use to promote their products through the auction: reach, link clicks (offers) or store visits. While there are other objectives available in the platform, I will mention the ones I have worked the most with local businesses.

  • Reach: deliver your ad to daily unique users and limit the number of times they will see your ad in a given time (example: 1 time each 7 days). When using this objective, you are maximizing the number of people you are reaching and your cost per impression will be lower when compared with other objectives. Probably users won’t click or engage with your ad.
  • Link clicks (offers): the platform will go after users that, according to their behavior in the platform, have more chance of clicking in ads, regardless of the number of times in a single day that they will see our ads. In addition, this objective allows us to use offers, a popup card with information that the user can present in the store when purchasing the product. Why not giving a discount to users that saw our ad in Facebook/Instagram?
  • Store Visits: based in daily unique reach and impressions, this is recommended to brands with multiple locations (at least 2 or more – be sure to setup your locations structure). It is intended to reach automatically the closest people around each location, without having to setup an individual campaign for each store, but instead using the same configuration for all of them. Based in signals such like WiFi and GPS, this objective will allow us to measure the number of store visits, people that went to the store or were very close after seeing your ad. It’s also very interesting, as we can see in image above, that we can show a map of the store, and when clicking it will be opened Google Maps in our mobile phone with the instructions on how to get there. We may also use the call to action of calling to the business.

Final thoughts

With over 2 billion people using Facebook, there are great chances that your clients and future customers are among them already. While this may sound like a lot of people, the truth is that by being very specific on who we want to reach, in what region, what age, gender, interests and behaviors, that universe will become smaller, making it possible to reach the right person and the right moment.

Advertisers see that Facebook has excellent tools to reach new customers, and more and more businesses are buying media in the platform every year. This is a challenge because users are also rapidly migrating from desktop to mobile. This creates a scenario in which currently more than 6 million advertisers are in the auction, making Facebook more expensive every year. This is an opportunity when you choose the perfect combination between objective and audience and you understand how ads are actually delivered.

While we didn’t analyze ad creatives and what makes engaging content, the thing is that if your local business create beautiful and compelling content people what to engage with, chances that people around your business become in customers are high when working with the right objective!