Do Facebook Ads Really Work?


Do Facebook ads work? Talk to a lot of business owners and they’ll say no. But just like anything in digital advertising, poor execution can make anything fail, even Facebook advertising. To really find success with Facebook ads there are a lot of pieces that need to come together, not just within the confines of Facebook ad manager, but across your entire digital marketing funnel. And if there is a weakness in one aspect of your funnel the whole thing can fall apart.

For many brands, Facebook advertising is the number 1 revenue generator. Look at a brand like Goli for example. I don’t know the exact number but I’ll bet that most of their revenue comes from Facebook ads. Facebook advertising has leveled the playing ground for brands. Specifically brands in spaces that are hard to break into on the retail front. Facebook ads are also highly beneficial to local businesses due to the targeting Facebook offers advertisers.

The thing that many businesses and even many digital marketing agencies that offer Facebook advertising and digital advertising don’t grasp is the concept of the cold audience. And this distinction makes all the difference. So yes, Facebook ads work, but just like anything in the online advertising space, your success is determined by how well your marketing funnel is in place and how well you articulate your value proposition to your potential customers.


Facebook Ad Campaigns for Cold Traffic Vs. Warm Traffic Vs. Hot Traffic

If you hop onto Google and search for a dentist 3 things can be surmised; you or someone close to you needs a dentist and you either don’t have a dentist or you are looking for a new one. This is warm traffic. When crafting Google Ads we know these 2 things so we craft our messaging with the intent and the need in mind.


Best Facebook Ad Formats For A Cold Audience

Facebook ads and other digital advertising doesn’t have this intent, and we don’t know if there’s the need. This is cold traffic. It’s not any better or worse, it’s just different, and requires a different approach. We’re not trying to use messaging to hard sell right off the bat. With cold traffic, we first have to let the ad viewer understand that they have a need, then how we can solve it. This is most often accomplished using Facebook video ads and Instagram Stories ads. The campaign objective is awareness. Whether your video ads are promoting a giveaway, your mission or simply introducing your brand to your target audience, this is the best Facebook ads campaign strategy to start building your custom audience.

If you haven’t sold to a lot of customers yet then you won’t be able to make full use of Facebook’s lookalike audience feature. A lookalike audience, or an LLA, takes a sample of people that have converted, for instance, purchasers, and creates an expanded audience based on their characteristics. You can do a 1% LLA for a narrower audience, up to a 10% LLA for a much broader audience.


Effective Facebook Advertising For A Warm Audience

A warm audience is someone that has already engaged in some way with your business page. Often this is Facebook users that have either liked, followed your Facebook page, commented, watched your video ad, or clicked it. They’re not cold because they know why you are now and showed some interest, but they’re not hot until they make a conversion action. This is the part of a simple ad campaign when you will really optimize for website conversions, often using a landing page and testing different ad types to work to convert those warm prospects into new customers.

If you’re selling a lot of physical product, i.e., ecommerce businesses, using carousel ads is a great way to showcase your products to custom audiences. A carousel ad allows up to 10 different screens within a horizontally scrolling ad. Kind of like slideshow ads.

If your using Facebook advertising to run lead generation ads then utilizing the standard ad format, or Facebook messenger ads might be the best bet. Testing is key. The more you can convert the warm audience the better your Facebook advertising will be. Try out different ad formats, ad placements, and test each Facebook audience.


Effective Facebook Advertising For A Hot Audience

So what is hot audience targeting? A hot prospect is a Facebook user that has already performed a high-level conversion. This can be signing up for an email list, downloading an ebook, taking a quiz, or purchasing something from your website. This is an engaged audience and by creating an audience segment for hot audiences we can increase our Lifetime Value and increase customer retention. A hot audience segment is likely to buy more, as they have already bought once. Not creating specific Facebook advertising campaigns to target the hot prospects is a huge mistake a lot of businesses make when it comes to Facebook ads.

This is one of the most useful aspects of Facebook advertising and why Facebook ads work so well, you can target at any stage of the funnel. Once you have enough conversions then you can really do some powerful audience segmenting. Target a Facebook ad campaign to your top customers and offer them something exclusive to reward them for their loyalty. Target those that haven’t purchased anything in 90 days and lure them back with a new product or a special promo.


Facebook Ads are all about the ROAS

The most important metric in Facebook ads is the ROAS. The Return On Ad Spend. If I came to you and told you that for every dollar you spend on ads you’d make $4 back what would you do? You’d throw as much money in as you possibly could. A great ROAS is this 4:1 and depending on certain factors can go a lot higher. As an agency, we have seen ROAS as high as 15:1. So for every $10,000 a client spends on ads they are generating $150,000 in revenue.

How do we get these kinds of returns? By utilizing Facebook ads and designing every aspect of the marketing funnel to convert and build trust.


The Biggest Downside Of Facebook Ads, the IOS 14 Update

The Facebook Pixel used to be the single most powerful part of Facebook advertising. It is a small tracking code that would grab all the audience data about people that clicked and purchased. It was amazing. And honestly one of the more fun parts of running Facebook advertising. But since Apple released iOS 14, which allowed iOS users to opt-out of tracking, the pixel has become much less useful and accurate. Sometimes less than 30% of conversions are showing up in the data. Even worse we are not getting anywhere near the amount of user data we used to.


I’m sure Facebook is hard at work trying to solve this. Advertising is their income source, so they have to work it out. In the meantime, there are a few solutions that are decent, though not great. A pretty intensive Google Analytics setup coupled with using UTM links to track each campaign or links in carousel ads is pretty effective. Free but time-consuming. The options that aren’t as tech or labor-intensive come with a pretty steep cost. Hyros is great but starts at $400/month, and a competitor, RedTrack, starts at $250/month so these options are out of budget for many smaller businesses.


What Types Of Businesses Are Best Suited for Facebook Ads?

Nearly every business type can find success with Facebook ads. The one exception is B2B businesses. For those LinkedIn is a much better choice. For everything else, businesses in these categories can find the most success running Facebook ads.


Online & Ecommerce Businesses

Businesses that don’t have a physical presence, like an eCommerce or SAAS business. This means they need to be able to market their product online and convert leads into customers in order to make money. All of which facebook ads excel at. E-commerce has been completely changed by Facebook and Instagram ads. They also lowered the bar to entry. No longer do you have to try and get your product in retail stores to thrive. Besides eCom and SAAS brands some other types of online businesses that do great on Facebook are online courses, local services, and affiliate sites.


Brands targeting Facebook Demographics

Brands that have a very defined target customer demographic that is active on Facebook will benefit the most from Facebook ads because Facebook allows you to target your audience based on specific demographics, behaviors, and interests. For example, if you are a local restaurant Facebook allows you to narrow down your ideal customer by home address and facebook activity so only people within 10 miles of your location who are interested in food appear as your potential customers for your ads. If you are a wedding photographer you can target local women in your target demographic that are engaged. The sky is the limit.


Brands that are targeting any of the interests Facebook offers

The interests you can select to target on Facebook are vast. You could set up ads to only target dressage riders in Wellington, Florida. Or maybe you have an online course to help married men communicate better. Whether local or national if you can see your target audience in terms of specific interests, locations, ages, genders, marital status, education, or employment industry then Facebook ads can work for you.


Elements Necessary To Create A Successful Facebook Ad Campaign & Marketing Funnel


Clear Goals: You always want to start a successful Facebook ad campaign with proper goals. Keeping in mind that this is cold traffic. This means your goal shouldn’t be going right for the sale in many cases. Unless your product is cheap or is commonly an impulse buy. People get ads from hundreds of different companies. And sadly more and more of them are scams. This means that you need to build trust. Often I recommend creating a lead magnet like an ebook or a giveaway to get the audience warmed up to your brand without you hitting them to buy. It’s like the equivalent of going on a few dates before you try to sleep with someone.

Testing: The first thing I do when starting a new Facebook ad campaign is begin testing. I recommend a testing budget. This is an amount for me to use to get through the learning phase Facebook creates and lets me test ad variations to determine the highest-performing wording, graphics, and audiences. This provides a solid understanding of how to progress.

Ad Sequences: Successful Facebook ad campaigns utilize sequences and different ad sets to show different messaging to completely cold viewers versus ones that had visited your landing page very those that added your product to their cart and then abandoned it. One size does not fit all. The better messaging you can create for each grouping the better your conversion rate will be.

Targeting: Targeting is the biggest benefit of Facebook and Instagram’s ad platform. It offers such robust targeting that it can be easy to get lost and create too broad of an audience. You want it broad but not too broad. There are many aspects of the targeting Facebook offers. The main ones are Gender, Age, Location, Marital Status, Employment, Income level, Education, and interests which include interests like shows, sports, hobbies, and much more.

Ad Creative: Ad creative is the first thing they see. It’s best to test video and graphics. In different niches, one typically outperforms the other. I like to create several versions of ad graphics testing out different images, text, and brand positioning. Often something as simple as changing a word or the color can make a huge difference in the click-through rate. Because the first step in the marketing funnel is to get that click. Once we have a good click-through rate, we can determine the strength of the rest of the funnel. Without a good CTR, it’s hard to evaluate the rest of the funnel.

Ad Copy: This consists of the ad text, the headline, and the link text. Again, small changes can make a really big difference. The best way to optimize this is to begin with several very different ad copy sets and see what performs best. Once the highest performing ad text has been determined smaller changes can be made to work to continually improve the CTR.

Landing Page: This is where they land once they click. This is also a step in the funnel that it is best to test a few different landing pages following the same process as the ad text, making 2-3 very different pages and seeing which gets the most conversions. Then once the highest performer has been determined making smaller changes to the test, imagery, colors, etc can prove to be extremely valuable.

Designing a high converting landing page is a huge topic all on its own. But it is a page that has one goal and typically doesn’t have a header or footer to make for a distraction-free environment.

By constructing a strategic and well-organized marketing funnel for your Facebook ads we can really understand where any weakness is. If no one’s clicking, it’s the top of the funnel, e.i. the ads or targeting. If they’re clicking but not converting it’s the middle of the funnel, the landing page that needs to be reworked. If they are clicking and adding to the cart but abandoning at a high rate then it’s time to evaluate the checkout process.

So yes, Facebook ads are absolutely worth it and can provide a ROAS that can fundamentally change your business’s profitability but only when they are done expertly.

If you are interested in learning about our digital advertising services feel free to reach out and we can jump on a call and discuss.

Gabriel Bertolo

Gabriel Bertolo is a 3rd generation entrepreneur that founded Radiant Elephant 10 years ago after working for various ad and marketing agencies. He is also an award-winning Jazz/Funk drummer and composer as well as a visual artist. He has been featured in Forbes, Business Insider, Shopify, and MECLABS for his insights into marketing and SEO.