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Advantages and Disadvantages of Facebook Advertising

March 3rd, 2010 · 1 Comment · Uncategorized

Facebook Advertising has grown in popularity and created quite a stir when it was first introduced. However, since the advent of targeting ads more specifically towards demographics (age, sex, education, etc) and having tighter restrictions on ad quality, Facebook advertising has been a viable traffic builder and advertising option for small and large size businesses.

Here are some advantages and disadvantages of Facebook Advertising:

Advantages

Customer Reach – 400 million customers (100 million mobile users) cannot be ignored. Yes, there are more Google searches that are being done and one could argue that Google Adwords can reach more but with usage time on social media channels continuing to soar, the custome reach for Facebook advertising is monumental and needs to be utilized.

Increased Targeting – Because of its ability to dissect and segment customer information, Facebook has the ability to offer increased targeting for their advertisers. If you would like to only target women, ages 25-35 with a college education who live in Glendale, California, then you can do that. Similary when someone changes status (married, single, engaged) they move into new markets, making them more attractive to target.

CPM or PPC Option – Most ad networks only offer one or the other. Facebook allows you to determine whether you are more focused on exposure and awareness (CPM) or focused on conversion and providing more information (PPC). You must understanding your audience first, but it is nice to know that the option is there.

Successful with Local Clients – With the ability to target locally very precise, companies and services that are looking for local or regional clients can reap benefits from the Facebook advertising system.

Disadvantages

Low Conversion Rates for eCommerce – People are using Facebook to talk with their friends and socialize and rarely are thinking about buying something when they log into their Facebook account. This creates issues when companies are focusing on click through rate and  high (>2.5-5%) conversion rates.

Weird, Irrevelant Ads – One thing that Facebook has continued to try and crack down on is advertising campaigns that make their way into the system that are irrevelant and are, at times, off putting to users of the system. Free giveways, rewards programs and humor sites have continued to flood the system, giving the ads less relevance when the consumer is viewing them.

High PPC Cost for Niche Markets – Marketers and bloggers have complained that PPC costs for niche markets, that would normally provide a low cost, are similar to pricing for general terms and demographic targeting. Facebook will need to continue to optimize their pricing model to make sure niche markets like “chicago wedding photographers” can afford to use this engine to attract traffic to their site.

Conclusion:

Facebook has come a long way since first releasing their advertising engine. When it first came out, people were very skeptical of the low quality ads that were being displayed and how effective they were at converted. In the past 18 months, Facebook has made significant progress at improving the model and I believe will continue to improve.

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One Comment so far ↓

  • Waqqas Alvi

    I believe CTR is dependent over how well you design your ad. I have experienced some good CTR and i think it was because i designed my ad keeping in mind the target audience.

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