How to Create Facebook Ads that Cost Less and Convert More

by 6 07/11/2014

So you’ve decided to start advertising on Facebook instead of Google because you’ve heard of the cheap costs per click. You get more traffic at a lower rate. Sounds like a no-brainer, right?

Except it isn’t. Many people simply treat a Facebook ad campaign like a Google ad campaign and then get frustrated when it doesn’t give them the amazing results they expected.

One of two things ends up happening. You either get the low CPCs but none of the clickers go on to purchase or subscribe to your site—which means you’re throwing money down the drain—or, contrary to what you hoped for, your CPCs end up being pretty high.

What’s going on here?

It’s simple. With Google, people are searching for you. They’re looking for what you’re offering and they’re typing your keywords into the search bar. So when they see your ad and click on it, they’re already interested in you and, potentially, ready to purchase something or subscribe.

On the other hand, Facebook users are just browsing and socializing. They’re scrolling through their newsfeed, checking out profile updates, pictures, and interesting things that people post. So when someone clicks on something, an ad or an article, it’s merely because his or her interest is piqued.

So, unlike in Google, there are two things you need to do to create a successful ad campaign in Facebook. First, you need to clearly define an audience that’s more likely to click on your ad. Second, you need to make that ad stand out from everything else on the News Feed.

We’ll go through both of these techniques using two real examples of ads currently running on Facebook. These are hypothetical ways in which both companies might have set up their ads with a focus on conversions.

The first is by Engagor, a B2B social media software.

Engagor Facebook Ads

The second is by AppSumo for their online entrepreneurship course. It’s a B2C digital product business.

AppSumo Facebook Ads

Defining your audience

The first sets of options are the general demographics. This is where you initially narrow down your audience.

B2C businesses with retail outlets and some B2B businesses with localized services will find the location settings useful. Neither Engagor nor AppSumo would need to narrow down on location but that doesn’t mean they shouldn’t. Targeting the world isn’t targeting at all.

Since AppSumo is trying to get people to buy with the lure of creating a $1000-a-month business, they might want to create separate ads for different countries and use local currencies.

Age settings depend on the product or service. Certain SaaS businesses might want to target an older demographic with more buying power or authority to purchase expensive enterprise software.

Engagor is a good example of this because their pricing starts at $500/month. It would be a waste of money for them to advertise to people below 25 years of age.

Gender is a handy demographic to target, especially for a B2C business selling female-only or male-only products. You’re immediately cutting out the half that you know aren’t going to buy from you.

There are more demographics available. You can target people based on whether they’re in relationships, what level of education they have and their occupation. Engagor could target specific employers and reach people in companies they would like to do business in.

The real power of Facebook ads lies in the interest and category targeting. Facebook has data on every page liked, every post shared, every group joined, every interest listed and every app used by every user. The general interests that Facebook suggests are too broad. Instead, use all the data Facebook has to drill down and target people who are most likely to click through and convert.

Target your competitors’ fans

Facebook tracks page likes so you can advertise directly to people who have liked your competitors’ pages. AppSumo might want to target people who like competitors like Ramit Sethi or Marie Forleo.

Using Facebook’s Graph Search, AppSumo could even find pages or interests liked by people who like Ramit Sethi or Marie Forleo or both. If they did this they would find that Entrepreneuress Academy is a popular page, while Yoga is a popular interest.

Target your own fans

Your own fans have already indicated an interest in your business by liking your page. However, they may not have already converted to customers. Targeting them with special deals will get you qualified leads and higher conversions.

AppSumo started out as a deals site for entrepreneurs and people who wanted to be entrepreneurs. So when they launched their online course, their Facebook page was already filled with the perfect audience.

Target e-mail subscribers and look-alike audiences

Like fans, e-mail subscribers are already into your business, more so because they let you into their inbox. Facebook allows you to upload your e-mail list into their Power Editor and finds the corresponding users.

What’s even cooler is that Facebook can also create a look-alike audience and draw up a list of people with similar characteristics to your e-mail subscribers. AppSumo could have created a custom audience from people who had signed up to receive their deals and reached out to a newer, yet still highly qualified, audience.

Target website visitors

It just keeps getting cooler. Facebook recently released Custom Audiences for your Website to help you create an audience from people who visited your site. By placing a piece of code on your site, Facebook tracks visitors and collects their Facebook IDs for your list.

What’s more, you can even target people who visited specific pages. Engagor might want to target everyone who went to their landing page for their free e-book. They could then create follow-up ads just for those people because they’ve shown some interest in their service.

Target behaviors

If you thought look-alike audiences were cool, wait till you see behaviors. All this data is pulled from actions people take on Facebook or through partner data mining sites.

You can target people by whether they spend online, what mobile phones they use and whether they plan on traveling to Australia. Just ignore how creepy this is getting for a moment and think about how you can use it.

One of the behaviors is Small Business Owners. This is taken from people who have created a page for their small business. This would be perfect for B2B companies like Engagor.

By getting it down to the right audience you’re not wasting money with your advertising. You might have multiple audiences that respond to different ads, so create different ad sets to target each audience.

Now you just have to make sure that when people see your ad, they click on it. That depends on what your ad looks like and what it says.

Making your ad stand out

The first thing that catches attention is the image. Just like oversized images on landing pages help convert better, your ad image is critical to your conversion rate. As people scroll down through the News Feed, only something loud and colorful will make people stop and read.

The Engagor ad is not a good example of this. It’s just a plain looking book in a white background. Guess what else has a white background? That’s right, the News Feed.

On the other hand AppSumo has a very catchy image. It’s Noah Kagan himself with a quirky look on his face standing against a dark wall. A picture of a human, especially a funny one like this, is more likely to catch your attention. In fact, because it looks like a selfie one of your friends might have taken, you don’t even realize it’s an ad till you read the copy.

Speaking of copy, you see that title that says, “Make a $1000 business?” That’s the second thing you see after the image and it’s what gets people to read the small print.

AppSumo nails it by specifying how much you can make with your new business. It gets you curious and makes you wonder how you’ll create this business. On the other hand, Engagor just has “Engagement ebook” as if it wasn’t clear what the image was.

With a catchy title, people will read more so they’ll start with the text at the top. That’s where you give them the overview of your product. Then, at the bottom, you go into the details and convince them to click through.

Engagor continues with their trend of being both redundant and minimalist at the same time. They are the perfect example of what not to do, while AppSumo obviously has been working on their ad conversions. If you are a Facebook ad consultant, you should contact Engagor.

Going back to AppSumo’s ad copy, look at how they use keywords and phrases like financial freedom and life-style business. It’s obvious that they have done a lot of research on their target market and used words that resonate with them.

Finally, they use social proof by mentioning 2,500 other people have taken their course and that Noah Kagan leads it.

Noah Kagan has actually spent millions of dollars on Facebook ads and he’s learnt to refine the process and get better conversions. This isn’t the only version of the $1000 business ad they are running. If the ads are showing on your News Feed you might notice multiple versions of the ads with different copy and images.

This is because they split test every aspect of the ad for each audience they target. In another version of the ad, they use the word muse, which you’ll recognize if you read Tim Feriss’s 4-Hour Workweek. Clearly they are targeting Tim Ferriss fans with this one.

Like Noah Kagan, you won’t get it right on your first time either, and you won’t get 100% conversions on your ads. You’ll need to create multiple ads and split test each one for a different audience, searching for the ads that convert best and dropping the ones that don’t.

In the next post in this series, we’ll look at how to split test ads so subscribe to the newsletter to get notified.

Read other Crazy Egg posts by Sid.

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About 

Sid Bharath is an entrepreneur, writer and digital marketer. He also blogs about e-commerce growth hacking.

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6 COMMENTS

Faisal

Hi Sid,

Nice Post, Well the beauty of Facebooks ads is, it looks like personalized message. For my previous company, I re strategize it to cross sell the products, which we were previously facing difficulty in promoting through our generalized line of products.

July 13, 2014 Reply

    Sid

    Hi Faisal,
    Glad you found it helpful. Thanks for sharing!

    July 14, 2014 Reply

Alex Chaidaroglou

Hi Sid,

from my experience, targeting a competitor’s fans usually is not very profitable, because most of them are already satisfied with that specific company, so they are not looking around.

On the other hand, using Facebook’s Graph Search as you mentioned to find complementary pages is far more profitable and ethical (if we put that too into the equation :))

The options of behavior targeting is indeed insane and using it, businesses can target with extreme percision.

Great article Sid, thanks for sharing! Looking forward to your next one.

July 14, 2014 Reply

    Sid

    Hey Alex,
    Thanks for the comment! Glad you liked the post.
    Regarding competitor’s fans, not all of them may be using that company’s service. Many of them liked their page because they saw an ad, or they read a post from their blog. For example, I was a fan of the Crazy Egg blog months before I started using the product, and I’m sure there are many other fans who are here only for the great content. That doesn’t mean we aren’t open to other similar tools. In fact, if I find something that’s cheaper or has more features, I might switch over.
    Now, from a competitor’s perspective, Crazy Egg has already done the hard work and built a fan base of engaged readers. Targeting them can get you qualified leads with an interest in your content. They may not purchase right away, but now you’ve got their attention and they’re in your funnel. I’d say that’s a win :)
    I also don’t think it’s unethical. You’re not poaching customers from competitors. If they’re happy with their current company, they can simply ignore your ad. If they’re unhappy or haven’t purchased anything yet, then they’re probably in the market and your ad offers them an alternative. If anything, you’re actually helping them make an informed decision by giving them another option :)
    Cheers,
    Sid

    July 14, 2014 Reply

      Alex Chaidaroglou

      Hi Sid,

      thanks for your reply as well!

      That’s true, I hadn’t thought about it that way. I had used it in the past without much success. I think I will give it another shot, after your comment :)

      Indeed, it is not poaching. It might yield better results if you advertise them content instead of services, so you start much earlier on the funnel.

      Definitely got to check that out! :)

      Thanks!

      July 15, 2014 Reply


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