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Is Advertising on Facebook a Best Bet for Your Small Business?

This is a guest post by Beth.

If your small business has an established social media presence on Facebook — and experts say it should — have you considered advertising there, too? A recent article on BizBest says that while you should seriously marketing your business online, using social media channels for paid advertising may not pay off like you think it would.

“While most local businesses can benefit by establishing a social media presence for free, paid advertising on the likes of Facebook and Twitter can be another matter. If you give it a try, be sure to test a variety of offers and approaches to see what works best,” writes BizBest founder Daniel Kehrer in his piece entitled “Why Small Business Ads on Facebook Flop”.

Kehrer goes on to quote Raed Malhas, CEO of the small online business MiNeeds, on the three specific failings of Facebook as a small business advertising platform summarized below:

1. Demographic Dilemma

The Facebook advertising approach targets certain demographics, including gender, age, location, marital status, and schools attended, among others. It may work well for national brands, but not so much for small local businesses that rely more on “intent based” search ads which are more successful at capturing customers when they’re ready to make a purchase.

“Google Adwords and various local search sites such as DexKnows, and SuperPages let you target specific keywords. Thus, local business ads will show up for specific searches for an attorney in Atlanta, for example, or a plumber or pet store in Portland,” writes Kehrer.

2. Ad Fatigue

Malhas notes that even if you manage to create a successful Facebook ad, sustaining your momentum can be difficult. “Let’s say I’m targeting males in Seattle between 28 and 40,” he says. “Even if my ad is extremely appealing to that target audience, the same audience will soon get bored with seeing the same ad again and again. They’ll ignore it and my conversions will drop to almost nothing.”

Fatigue factor can be especially troubling for small businesses with a limited local target audience. It’s not an issue with search ads because consumers typically don’t search for the same product or service every day, just when they’re in the market for it. Advertising on search platforms will catch them without the fatigue factor.

3. Competition from Deep-Pocket Brands

“When Facebook first launched its ad platform, smaller businesses were paying only a few cents for clicks on their ads,” notes Kehrer. “But then big national brands started competing for the same demographics and drove up the price.”

Malhas tried advertising on Facebook and was disappointed with the results, in part because he says his rates rose ten-fold in a matter of months. “Suddenly it made our cost per lead too high and we had to kill many of our Facebook ads,” he claims. “Today’s small business with only a few hundred dollars to spend per month stands no chance on Facebook against those titans.”

So, before launching an advertising campaign on Facebook, consider carefully your ROI and whether it will drive the right shoppers to your small business.

About the Author

Beth Longware Duff is a professional editor and award-winning writer whose work on a wide variety of topics has been published in print and electronic media. She currently writes on a wide range of topics dealing with electronic payment processing and online credit card processing for small business for Merchant Express.

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