Does Facebook advertising boost your entire marketing ROI?

As a business owner, you want a decent return on your marketing spend, right? A positive marketing ROI is especially important for smaller companies, when budgets are lean and time for activities outside your core business is hard to come by.

Fortunately, we’ve moved beyond the times of “unmeasurable marketing” and into an era of hyper-targeted, traceable and measurable digital advertising options, including social-media advertising.

Perhaps “unmeasurable” is a misnomer, but it’s not far from the truth. In the days when print was king, the only way to determine if advertising was generating new business was to include a dedicated call to action or alternate phone number. It helped identify the origin of sales queries, but it took time and attention (which were always in short supply) to get a clear picture of success.

Some channels were basically compulsory. If your business wasn’t in the phone directory, it didn’t exist, so you couldn’t afford not to advertise. Directories were sorted alphabetically, so A.A.Aardvark got a good proportion of initial phone enquiries, and XYZ Company not so much. It was also up to the searcher to trawl through hundreds of listings to find a business local to them. It cost thousands of dollars every year, may never have delivered a single sale in return and that was just the way it was.

Tailoring to your target

What a difference a decade or two makes. Today’s digital marketing tools enable small businesses to reach new audiences in an increasingly targeted way. SEO marketing and paid search will put your company in front of would-be customers when they specifically seek the goods and services you offer, while additional digital alternatives like Facebook advertising will boost online marketing efforts by raising brand awareness, generating leads from target audiences and directly connecting your business with current and prospective customers.

The more you know about your target audience, the more specific you can be with Facebook advertising. You can reach them based on demographic information – including age, sex, income and education level – on their geographic location, or user-level specifics like interests and hobbies, behavioural traits and employment information.

One of the biggest advantages of digital marketing is the degree of transparency it provides – you know precisely what it costs to capture and convert a customer, simplifying online advertising ROI analysis.

Collective gains

Search preferences and external influences vary from one person to the next, so there’s power in implementing a digital marketing strategy that uses a range of tools. Focusing on search can deliver excellent ranking results for your business, whereas targeted Facebook ads will help you reach customers based on specific identified criteria. Are these separate initiatives, or could one have a significant positive influence on the other and deliver a better overall ROI?

ReachLocal analysed 1000 customer search campaigns to see if incorporating Facebook advertising had any influence. Here’s what we discovered:

  • 57 per cent lowered their cost per thousand impressions (CPM) across both social and search ads
  • Average cost per click (CPC) improved by 18 per cent
  • 83 per cent increased search advertising clickthrough rates (CTR)
  • 82 per cent lowered search advertising cost per click (CPC)

These numbers suggest that local businesses achieve greater results when combining the two channels, underscoring the power of a multifaceted approach. In truth, there’s no one magical tool that can do it all, so if marketing ROI is important to your business, it’s time to focus on the gains that a multi-pronged approach provides.

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