Monday, September 14, 2009

Facebook Ad Click Through Rates

What to Expect From Advertising in Facebook

For the past two months I have been very actively working to put together hard numbers on Facebook advertising for local insurance agents.

Facebook Advertising is Similar to Google Adwords

Both Facebooks ads and Google Adwords do the following:

  • You bid for the ad
  • You only pay when some one actually clicks on your ad
  • Getting the click is only part of the value – the page the click take people to has to be successful in getting those people to take the next action you want them to take
  • You can set a daily and monthly budget
  • You can turn the ad on and off in real time

Facebook ads have several features you cannot get in Adwords. Facebook lets you filter the people you want to target your ad for based on most all of the person’s Facebook profile information. You can decide only to show you ad to people in very small geographic areas – perfect for a local business. You can filter by age, income range, occupation, interests and more.

Facebook is at a disadvantage to Google in one key area. Google shows your ad only to people who are looking for your product or service. Facebook shows your ad to folks who are not looking for your product or service. This makes Facebook advertising more like newspaper, radio or TV ads. It is an interruption hoping to catch the attention of some folks.

Click Through Rates

Based on the information from actual Facebook ad campaigns run over a period of months I have seen click through rates from less than 1 click per 1,000 impressions to as high as 7 clicks per 1,000 impressions of ads.

I have seen cost as high as $1.90 to as low as a few pennies.

Google click through rates I know about range from 5 per 1,000 to 300 per 1,000. Because folks using Google search are actively trying to find something it is no surprise the click through rates are higher.

I have seen Google costs for these same keywords from well over $10.00 to as little as 10 cents for very narrowly targeted niches.

In general you get more clicks and you pay more per click with Google than with Facebook ads based on the information I have available to me.

Return on Money Spent

I do not have hard numbers on your return on money spent on Facebook ads.

Even if I did, the problem is always the quality of the page to which the ad takes a person clicking on the ad. The landing page effectiveness is the main factor in return on money spent on ads. I have personal experience with at least a 1,000% difference with the exact same ad and different landing pages.

This is a topic for another time.

Conclusion – Facebook Ads Are Worth A Shot

I personally have found Facebook ads have created additional sales worth more than the money I spent. I recommend you give them a try and carefully track results.


Pat Alexander said...

Interesting information. Thanks for sharing with us.

Nibby Priest said...

I tried FB Advertising for our agency in July 2009. The results were outstanding. My google analytics reflected my web traffic up 200%. Yes, people were going to our site. My issue is that I cannot get them to complete a quote request to result in a sale. Our agency website looks good but we are lacking the bait to get people to complete the sale. This looks like a huge opportunity for vendors of rating systems to hook into agents website to provide this service.

Duke Williams said...


Thanks for the input. two things...

I have read about a typical large drop in click throughs after about two weeks of FB ads. Did you see this or did you keep changing your ad?
Second, as a former vendor of rating systems I can tell you the reason this opportunity is not being taken is the insurance companies do not want their rates visible in this way. I think that is very short sighted.