3 Best Practices for Facebook Sponsored Stories

The Challenge: Marketers are eager to take advantage of Facebook's huge customer base and powerful targeting options, but Facebook's most powerful tool remains relatively unknown.

Few advertising channels heed the Voice of the Customer (VoC) more directly than Facebook Sponsored Stories. Users determine what they say, when they appear, and who they appear to. While some advertisers might see this lack of control as a disadvantage, savvy marketers recognize it as a guarantee of authenticity.

Unlike traditional ad units, Sponsored Stories are not directly created by brands. Instead, brands must create meaningful and engaging content on their Facebook Pages. When users interact with that content – whether by Liking it, playing a game, or posting a comment – that engagement appears on their Timelines.

Standard Facebook Ads display generic brand messages and offers, like "Go to Starbucks for 20% Off!" As we reported last month, these were often ineffective and driving high levels of engagement, because there was a mismatch between the purpose of the platform and the purpose of the ad unit. Google users may be looking for ways to purchase goods and services, but Facebook users want to check in on their friends. Sponsored Stories addresses this problem: ads provide relevant, social news - "Tom just checked in at Starbucks" - rather than trying to make a sale. The result: effective, scalable social endorsement campaigns.

KEY TAKEAWAYS FOR MARKETERS

» Fill Your Facebook Pages with "Engaging" Content
Sponsored Stories can only be generated when users directly engage with content on your site, whether by Liking it, commenting on it, taking a poll, playing a game, etc. If you don't keep your pages up to date, your fans won't have any opportunities to engage—and you won't have the opportunity to drive social endorsements with Sponsored Stories.

» Provide Opportunities to Share rather than Opportunities to Sell
The key to Facebook's popularity is sharing: users of the site can share their own status and check up on others. They're not there to buy and sell. To keep your social endorsements coming, build content that users will be eager to share – like fun games or interesting content – rather than more commercial content like discount coupons.

» Give Fans Reasons to Keep Clicking
As with every other marketing channel, digital or offline, no customer is better than a repeat customer. Give your fans a reason to keep coming back by posting fresh, relevant content to your Facebook Page on a daily basis.

Facebook Ads: Optimize for Awareness, Not Direct Sales

The Challenge: Facebook Ads has not proven to be an effective direct sales medium. While this has led to shareholder frustration, advertisers should ignore the focus on sales and optimize for engagement and awareness.

When it comes to Facebook Ads, there's a significant disconnect between Wall Street and Madison Ave. Since Facebook's IPO in May, investors have been looking for revenues high enough to justify a multi-billion dollar market cap. They haven't found them. On Thursday last week, Facebook released their first earnings since their IPO. For investors, the results were predictably disappointing.

For advertisers, the fixation on Facebook's earnings is a distraction. The plain fact is that Facebook Ads isn't a direct sales channel; it's an awareness channel.

Earlier this month, Ad Age and Citigroup conducted a survey to determine why marketers use Facebook Ads. Overwhelmingly, marketers use Facebook Ads to, "Build awareness and sentiment for my brand." Others were trying to drive website traffic or build their fan base. Fewer than 10 percent of respondents said they were trying to generate sales leads or engage in social commerce.

The Ad Age survey reflects an important reality about Facebook Ads: while they're a powerful way to build brand awareness, they are not a strong direct sale mechanism. Of course, this doesn't mean that marketers should ignore them altogether. As Max Kalehoff recently wrote at MediaPost, “Facebook Ads, thus far, have proven to work best toward top- and middle-of-funnel marketing goals. Therefore, the fact that brand-building is the top goal is not surprising.”

When marketers recognize Facebook Ads as an awareness and engagement channel, they can optimize and budget their Facebook investment accordingly.

KEY TAKEAWAYS FOR MARKETERS

» Allocate Budget for Every Stage of the Conversion Funnel
Ultimately, your entire marketing budget is directed toward one goal: driving revenue. That said, each stage in the conversion funnel should have its own budget. Determine how much you're willing to spend at the top the funnel – "Awareness" and "Lead Generation" – and allocate a percentage of that budget to Facebook Ads.

» Define "Awareness" KPIs ("Key Performance Indicators")
If you optimize your Facebook Ads for direct sales, you'll always be disappointed. By defining "Awareness" KPIs, including "likes" and website visits, you'll be optimizing for Facebook's strengths. Measure results accordingly.

» Track Facebook Leads to the End of the Funnel
Not all leads are created equal. Determine how often leads generated by Facebook Ads eventually lead to sales, and allocate your "Awareness" budget accordingly.