Is Facebook Advertising A Good Investment?

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There’s simply no denying it: we live and work in an online world now. As a business owner, you have to take advantage of online opportunities to reach your customers, promote your company, and advertise your products and services. Paid ads on Facebook are one of the many marketing tools available to you.

Anecdotal evidence regarding the effectiveness of Facebook ads goes both ways – it works great for some businesses and does nothing for others. Is Facebook advertising right for you? Here’s a breakdown of what you really pay for when you buy Facebook ads.


How Facebook Ads Work

At first glance, Facebook ads seem to have a lot in common with other forms of online advertising. You can choose to pay by the click (cost per click or CPC) or by the view (cost per thousand impressions or CPM). You set a budget for your ads to limit your overall costs. Your ads go out, people see them, and they (hopefully) follow your call to action. Is this any different from Google AdWords or other online marketing platforms?

Yes, it is!

The huge factor that puts Facebook advertising in a class by itself is the demographic data Facebook puts at your disposal. Where other online advertising channels show you — at best — what websites and search terms visitors use to reach you, the feedback from Facebook ads tells you a great deal about the people you’re reaching. Data including age, sex, location, and interests are all available to you, and you can use this information to refine your ads and target selected groups more precisely.

Potential Drawbacks to Paid Social Media Advertising

This article is titled with an open question that a lot of people, both marketing professionals and their business-owning clients, are asking themselves. Is advertising on Facebook really worth the cost? After all, the entire point of marketing your business through social media is supposed to be generating vial attention, isn’t it? That doesn’t cost anything, and it can be extremely effective if you do it right.

Perhaps the biggest trap in assessing the value of Facebook advertising is a failure to measure return on investment (ROI) properly. The effectiveness of a given Facebook ad is typically quoted in terms of dollars spent per like, share, and follow. These are terms that are familiar to social media marketers, but they’re not the same goalposts business owners should be looking at.

If your advertising campaign ends up costing over a dollar per like, that can look like a real boondoggle. To measure ROI, you need to look at what comes after a Facebook like. If a majority of the people who like your ad wind up buying something from you, that dollar starts to look like a sound investment.

Advantages to Advertising on Facebook

While there are many strong arguments in favor of social media marketing in general and Facebook advertising in particular, you should concentrate on one factor that’s both exceptional and unique to Facebook. As noted above, buying a Facebook ad doesn’t just get you access to potential customer’s eyeballs. You also get extensive demographic information on those viewers.

This can be a very precious resource, especially to smaller businesses that don’t have the budget to conduct extensive market research. Learning all about your customer’s demographic details may be enough to justify the cost of Facebook advertising all by itself, regardless of the cost of individual likes or the ultimate ROI you get from your ads. Facebook isn’t just a medium for advertising your business; it’s also a potent research tool.

Ideal Situations for Facebook Advertising

Bear in mind that Facebook allows you to put all of your new-found demographic insight to work immediately. You can start targeting different ads to different users as soon as the feedback starts coming in. If you’re running an agile marketing campaign and pursuing different demographics this can be a perfect match for your marketing needs.


Facebook ads are also a terrific way to gather email addresses for other marketing efforts. Facebook makes it much easier for users to share their contact information with you than other sign-up systems, improving the number of addresses you collect. Using an incentive (e.g. a contest that requires registry) can boost your harvest even further.

Finally, Facebook makes a terrific tool for pushing mobile apps. Because a significant number of Facebook users are interacting with the site through phones and tablets, you’re ideally positioned to tap into a market that’s already pre-disposed towards mobile usage.

How to Measure Your Ads’ Effectiveness

As noted above, you need to take a wider view of the impact your Facebook ads have than simply counting likes and followers. While it’s perfectly fine to experiment at the start of your Facebook marketing campaign to gather demographic data and familiarize yourself with the process, as time goes on you need to zero in on your goals and track them accurately.

Facebook ads are often simply one part of a larger sales funnel that can include emails, website forms, online stores, and even personal contact. If this is the role you choose for your Facebook advertising, make sure you don’t obsess over Facebook numbers when you could improve conversion rates by tinkering with other parts of your sales funnel.

Like all marketing tools, the effectiveness of paid ads on Facebook ultimately depends on how you use them. If you expect them to magically boost revenue and make your company more popular as soon as you pay for them, you may be in for a big disappointment! When integrated into a wider marketing campaign and used intelligently, though, Facebook ads can work wonders for your business.

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