The heyday for selling on social media was 2013. If you were selling with Soldsie then, you remember the day when you could start a store and get to $1,000 or even $10,000 in sales in no time. Well, Facebook put an end to that in 2014, and the sky started to fall. Sales dipped for everyone, and many quit selling with comments or shut down their businesses completely.
Some businesses stuck it out, though, and tried a number of strategies to keep sales up while they weathered the storm. Many started to sell on Instagram where organic reach is alive and well, some opened brick and mortar stores, some started websites, and some invested in Facebook advertising. From conversations with our customer base, it seems many of these strategies helped them keep their stores open.
For the comment sellers that decided to stick it out on Facebook, buying ads on Facebook has become a winning strategy–so much so that they are seeing more sales today than they did in 2013! A number of businesses are seeing tens to even hundreds of thousands of dollars in sales on Facebook using comment selling and Facebook ads. Check out the graph below of the stores we we spoke to vs stores that are either not running ads or running them improperly.
We’ve spoken with Facebook advertising experts, run tests with stores, and learned best practices to crack the Facebook ads conundrum. Based on the results, it’s working. In this blog post, we outline what we’ve learned so you can test running ads for your business and find success. Based on a small sample size of customers, this strategy is working wonderfully with comment sellers, but we also think this works with a web stores. Let us know if this helps!
How to Successfully Buy Ads with Comment Selling
In short, the keys to success with Facebook ads are targeting posts with Lookalike ads and having a deep inventory.
Stores today are spending 10% to 12% of their sales on Facebook ads. So if someone is making $50,000 a month, they are spending $5,000 to $6,000 a month on Facebook Ads. This may seem like a lot, but this is the cost to make money on Facebook.
When it comes to running ads, it is key to test boosting posts to a Custom Audience and Lookalike Audience.
Here is a quick guide on Custom Audiences and Lookalike Audiences:
Custom Audiences: A Custom Audience is usually created by a list of email addresses. The best way to build a Custom Audience is to upload your paying customers’ emails to the Audience Manager in the Facebook Ads Manager. Read how to export your paying customer list from Soldsie here. Name the audience and boost to that audience. To get this data from Soldsie, please email firstname.lastname@example.org with your store name, and we will retrieve it for you in 24 hours.
Lookalike Audience: Lookalike Audiences are a way to reach new people who are likely to be interested in your business because they’re similar to customers you care about. When you use Custom Audiences, you can choose to create a Lookalike Audience that targets people who are similar to one of your Custom Audience lists.
These are the key to your success. You can easily create a Lookalike Audience in your Facebook Ads manager. You want to create a Lookalike Audience based off of the emails you uploaded to create a Custom Audience.
Boosting A Post: When you post to your Facebook Page, you get the option to boost a post. You want to boost your posts to a Lookalike Audience. A big mistake businesses make today is not targeting these boosts.
Cost Per Engagement: This is the average cost per action related to your page’s posts as a result of your ad. Learn more here.
Most Soldsie users run weekly auctions on a given night. This has worked well because it creates a level of excitement in your customers and primes them for what will be available on the day of the sale. Weekly auctions maximize sales of the products you post, and they help you figure out what’s popular.
A great strategy is to use your marketing budget to promote popular items–items with high engagement (likes, comments, and shares)–the next day with Facebook ads. That way you know you are promoting products that you expect to be purchased by your customers.
When you boost products to Custom Audiences and Lookalike Audiences to see what gets the highest amount of sales, you want to run ads that have a Cost Per Engagement of less than $0.15.
If you aren’t getting a Cost Per Engagement of $0.15 or lower, experiment with changing the product, audience, copy, or images. You could also just be promoting a product people aren’t interested in. It’s important to also make sure that the engagements you are getting are based on people buying and not just tagging their friends in the posts.
Businesses typically spend $150 to $350 to boost a post to see if it’s a popular product. If they aren’t seeing success after that amount of spending, they typically stop promoting the post. We recommend you do the same.
One of the biggest drivers of success with ads is being able to find a great product that fits the audience you are targeting. One way to describe it would be “ad, product fit.” It helps tremendously to have access to a large inventory of products.
The worst thing that can happen to you is running out of a product before your ad loses its effectiveness. This limits the potential revenue generated from a post because you have limited quantities of an item. The best way to get around this is by working with your vendor or manufacturer to keep products readily available to you in case you need to buy more. With this strategy, you can place the order with your vendor only once your customers have paid, taking the guesswork out of ordering.
This is an incredible model which completely de-risks things for you and allows you to maximize ad spending. We encourage you to create strong relationships with your vendors to be able to do this.
Make sure your Cost Per Engagement is $0.15 or less and make sure you are receiving positive ROI on your ads. ROI is calculated by: (cost of goods + ads + shipping + any additional costs) – amount the customer pays.
Once you meet both success metrics mentioned above, you’re ready to scale your business. Businesses are spending 10% to 12% of the money they make on promoting posts to Lookalike Audiences.
If you have any questions, let us know at email@example.com.