In 2016, retailers spent over $1.24 billion on holiday advertising. Brands also increased their Q4 Facebook ads budgets by 11%, and saw a resulting 87% spike in ROAS. We asked Nicolette Dineen from our Social team why Facebook advertising is so effective for the holidays.
Then we picked her brain for best practices to use this upcoming season.
Q: Why Facebook? What unique benefits do Facebook ads offer for small & medium businesses?
ND: Facebook reaches people in a very social manner—right in the newsfeed. It has 2 billion (monthly) users, so its 1st party data bank is beyond other platforms’. Look at lookalike modeling – another display platform would need 1000 users to get data. Facebook needs 100.
Facebook ads are extremely personalized. It also targets locally and can reach audiences virtually anywhere. This makes the ROAS extremely high.
Q: Do Facebook ads work the same way for prospecting and retargeting campaigns?
ND: Yep! Facebook is a full-funnel vehicle for advertising. You can adjust how you target people and place ads for various scenarios. This means you can serve the right people the right ad at exactly the right time.
Q: Should businesses outsource Facebook ad management or can they do it in-house?
ND: Businesses can 100% do this themselves. But—outsourced experts are set up for getting the best ROI. Their teams have analysts and designers that can do everything for you and manage your campaign full-time. They also have the highest-level of expertise in targeting and how to run multidimensional targeting campaigns.
Q: How can small & medium businesses optimize their targeting strategies?
ND: Use Facebook’s personalization tools. Look at past data to see how your customers make their decisions and then think about your market. Variables that affect your ads can be your audience, geography, the seasonality of your products, and even the weather.
Q: The weather?
ND: The goal is to hyper-target. So if you’re selling sweaters and the forecast says it will be cold for the next few days, you can serve an ad that says, “It’s chilly out. Cozy up with one of our sweaters.” I’ve also done ads for coffee companies that send out messages for iced coffee only when a location gets over a certain temperature.
Q: When would businesses need to start these ads so that they’ll be effective for holiday shopping?
ND: If you want your ads set for October 1, they should be set up in the end of August. For November 1 set them up and put them in place mid-September. When you start early you can think about your strategy and make creatives for each message and promotion.
Q: What is the best way for businesses to start a budget for holiday Facebook ad campaigns?
ND: Start with your marketing budget as a whole. Brands usually put about 50 percent of their annual advertising budget during this season. Then remember that the cost of advertising spikes during holiday season because the CPC is higher. Nonetheless, aim for your CPC to be under $1 and your CPM to average $7.