Would You Like More Personalized Ads? New Facebook Updates Target Small Businesses

Business.com / Social Media / Last Modified: February 22, 2017

Facebook ads are becoming even more targeted as they include location-based data from multiple sites. But it comes at a cost.

Two new Facebook product updates are aimed at small businesses. Here’s how they work.

The first is an update to local awareness ads, first introduced in 2012 to provide the ability to target ads to users who check into your site within a certain distance from a store or business location.

If you have multiple locations the new update provides the additional capability to target users to those specific sites.

In a blog post, Facebook explains that, “If a cafe with multiple locations across the UK decides to run local awareness ads, they could choose to automatically populate the city name in their ad copy, depending on where the people seeing the ad are. So, people in Glasgow would see ‘Join us for lunch in Glasgow,’ while people in Bristol would see ‘Join us for lunch in Bristol.’

Call-to-action buttons are also dynamic, so when someone clicks on the ‘Call Now’ or ‘Get Directions’ button, they’re connected to the store currently closest to them. This helps advertisers spend more efficiently, since they’re only connecting with people likely to visit the store and the information they share is hyper-local and relevant."

Would You Like More Insight Into Your Customers' Behavior?

The second product is called "local insights." This provides demographic details (such as age and gender) as well as data such as whether your Facebook visitors are local residents or tourists. This way you can better target ads to those in actual proximity to your store or business location.

You can also determine the proportion of people who view an ad to the people who are actually near your store or location, to help determine the overall effectiveness of your ad placements.

Is This a Feature Your Business Would Like?

First, a little history. Traditional (by which we mean as little as four years ago, an eon in Internet time) Facebook advertising for small businesses used to mean you had a Facebook page and you built a community asking people (potential customers) to Like your posts.

The more people engaged with content, the more your message(s) spread. And, best of all, it was free. This was called "organic reach”, as opposed to “paid reach", meaning people would see your posts as the result of paid ads.

While giving away free advertising via organic reach isn’t a profitable business model for the Facebook folks, when you’re trying to extend your brand, it’s a start. Facebook, however, always limited organic reach.

Fuze SEO notes that Facebook limited how many “Likes” got out there. For example, in 2012 Facebook disclosed that pages have an organic reach of only 16 percent of their audience on average.

If you had, say, 100,000 Facebooks fans, 16 percent still represents a relatively hefty potential audience, but less so if you’ve only got 1,000.

Related Article: Build Better Ads: 7 Ways to Improve Your Facebook Ad Campaign

Eventually, Facebook's allowed organic reach has gradually declined. Social@Ogilvy notes that by February 2014, “organic reach hovered at 6 percent, a decline of 49 percent from peak levels in October.

For large pages with more than 500,000 Likes, organic reach hit two percent in February. And Facebook sources were unofficially advising community managers to expect it to approach zero in the foreseeable future.”

So much for the argument of, “Why should I pay for something if I can already do it for free?”, as Facebook may be pushing you to accept paid advertising. But it isn’t like you are going to have much of a choice if you still use Facebook as an advertising channel.

Consider this: The Guardian reports that an average of 1.1 billion active users visit Facebook every day. That’s all the more impressive because Facebook now counts active users only as those who actually visit the site or use one of its mobile apps, as opposed to millions of people who only interact with the site through third-party sites.

Despite that more restricted definition, monthly active users rose by more than 60 million in quarterly results reported in November 2015.

That’s a lot to "like" in terms of potential to not only reach your audience but gain valuable insight into its behavior.

black and white facebook logo with hands and a tie.

What’s Not to Like

An ever increasing number of users access Facebook primarily through their mobile devices. That’s great if a potential customer is traveling near you and you want them to see your ad.

The problem is, as Marketing Land points out, “If iPhone users have turned off location services for Facebook (never) they won’t see these ads.”

Rodney Hess of Web Marketing Today also notes that local awareness ads offer limited segmentation (age and gender plus location).

This "can lead to irrelevant impressions for businesses in a very niche market," Hess writes, "which is problematic since Facebook bills the ads on a cost per thousand impressions (CPM) model."

Related Article: Google Ads vs. Facebook Ads: Which is Better?

Try It Anyway

As with any kind of advertising you don’t know until you try it. Here’s a few success stories, courtesy of Social Media Today:

  • UGG Australia used local awareness ads to urge customers to "Walk, Skip or Dance” to their flagship stores during the last holiday shopping season. Result: a 3X return on ad spend.
  • A Los Angeles school for professional makeup reached out to the 18 to 35 year-olds within driving distance using local awareness ads to encourage learning more about what the school offered. In 30 days, the campaign generated two million local impressions at a cost of only two cents per impression.
  • A tire discount company experienced its highest average weekly sales for the month during its first week’s use of local awareness ads. The cost per impression was two times less than that of TV and radio ads.
  • The Greater Miami Convention and Visitors Bureau used local awareness ads to encourage locals to share their photos of the region. They ended up with more than 7,000 photos and 100,000 mentions of specific neighborhoods; and got 5.5 million impressions at a cost of 23 percent less than their previous ad efforts.

If it’s true that all politics is local, certainly effectively marketing is as well. 

Facebook has provided some interesting tools to improve advertising localization and more precisely target your message to the people you want to reach. Whether you ultimately "like" it or not, it’s worth being aware of.

Related Article: Digital Disrupt: Ad Platforms Taking the Display Ad Marketplace by Storm

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