1 Direct Response Marketing on Facebook

Direct Response
Marketing on
Facebook
Driving action online, in-store
and in mobile app
Summer 2014
2 Direct Response Marketing on Facebook
Facebook’s direct response marketing solution 4
Best practices 14
Campaign prep 16
Targeting 18
Creative and messaging 20
Bidding 21
Measurement 22
Table of contents
3 Direct Response Marketing on Facebook
We live in a transformational time. As the need to stay connected becomes integral to our everyday
lives, the use of smartphones, tablets and laptops is becoming increasingly common. Not only are
people using multiple devices, they’re constantly switching between them throughout the day.
Marketers are faced with the challenge of reaching their consumers in this changing environment.
With over 1.32 billion people
1
on Facebook checking their News Feed an average of 14x per day
2
,
Facebook provides a unique opportunity for businesses to drive positive business results with more
of the right people across devices. Marketers can:
• Reach more of the right people with Facebook’s sophisticated suite of targeting products
• Drive action across devices with ad units in News Feed
• Make insightful decisions with Facebook’s measurement solutions
From campaign prep to targeting, creative, bidding, measurement and optimization, this guide
will walk you through our entire solution and best practices for setting up an effective direct
response campaign.
Sincerely,
Your Facebook team
1, Facebook internal data, June 2014
2. IDC, “Always Connected,” March 2013
Introduction
4 Direct Response Marketing on Facebook
Facebook direct response
marketing solution
Facebook offers a sophisticated direct response
marketing solution for marketers to reach more of
the right people, drive action across devices and
make more insightful decisions. Whether you’re
driving sign-ups on your website, sales in store or
installs for your mobile app, these products can
help drive your business objectives from Facebook
across devices.
5 Direct Response Marketing on Facebook
Targeting
Facebook has a powerful targeting solution that enables you to
target based on the data people share on Facebook, your first-
party data and third-party data from trusted partners. Use these
tools to find more of the right people you want to reach.
Core Audiences
Reach people based on interests, demographics, location and behavior.
Facebook’s core targeting option allows you to target people based on information shared on their
profiles and the behavior they exhibit on Facebook. Segment your audiences based on their
demographics, location, interests and behaviors.
Partner categories are a way to target people based on their off-Facebook behavior through our
partnerships with trusted third-party data providers such as Datalogix, Epsilon and Acxiom.
Custom Audiences
Reach people based on the data you have.
Custom Audiences enable you to target people based on the data you have in a privacy safe way.
With Custom Audiences, you can:
• Target people based on CRM data.
• Target people based on actions taken on your website or mobile app.
Lookalike Audiences
Reach people who look like your audiences.
Lookalike audiences help you find people with similar characteristics to your existing customers,
prospects and Page fans.
You can build a lookalike audience from your:
• CRM database
• Website visitors
• Mobile app customers
• Page fans
Success Story
Banana Republic used lookalike
audiences modeled after
its most loyal customers to
increase its customer base
during the competitive holiday
season.
Result:
A nearly 4X higher return on
ad spend.
Facebook case study, June 2014
6 Direct Response Marketing on Facebook
Facebook Exchange: Dynamically remarket to website visitors on desktop
Facebook Exchange allows programmatic buying of desktop ad inventory through real-time bidding.
You can remarket to website visitors on Facebook based on the activity they exhibit on your website
with real-time dynamic product ads. Facebook Exchange is only available for link ads and right-hand
column on desktop and can only be purchased through a registered demand side platform (DSP).
Custom Audiences and Facebook Exchange are complementary
Remarketing through Facebook Exchange and Custom Audiences are similar but can be leveraged
in different ways.
Mobile Delivery
Exclusion
Placements All Facebook Facebook desktop only
Standard ads (domain only)
Page post ads (link only-beta)
Standard ads, Page post ads,
Mobile
Dynamic Creative
Ad Formats
Access to Facebook’s Targeting
Facebook Lookalike Audiences
Real time bidding
Custom Audiences Facebook Exchange
7 Direct Response Marketing on Facebook
Placements and Ad Units
Facebook offers several ad units for advertisers to capture
attention and drive action. News Feed is the most effective
placement for advertisers looking to drive direct response
objectives because its ad units are in-stream and native to the
Facebook experience and across devices.
Link ads direct people off of Facebook from any device to a specific
location on your website that you choose.
Link ads offer:
• A large, clickable real estate in News Feed across devices
• The ability to add strong call-to-action buttons to drive
conversions
• The ability to showcase multiple products from your inventory
within a single link ad unit
Photo ads are designed to drive brand awareness and engagement
from Facebook’s News Feed.
Photo ads offer:
• A large real estate for an image in News Feed
• A compelling canvas for advertisers to capture attention
from News Feed
Creative specs for link ads
• Recommended text count: 90 characters
• Recommended image ratio is 1.91:1
• Recommended image size is 1200x627px
Creative specs for photo ads
• Recommended text count: 90 characters
• Recommended image ratio is 1.91:1
• Recommended image size is 1200x900px
Link ads
Drives traffi c to your website and store
Photo ads
Drives traffi c to your store
8 Direct Response Marketing on Facebook
Mobile app install ads drive people directly from News Feed to the
App Store or Google Play to install from a strong call-to-action.
Mobile app install ads offer:
• A large, clickable real estate in mobile News Feed
• Strong call-to-action buttons – Install Now, Play Game, Watch
Video, Shop Now, Listen Now, and Book Now
• The option to use video or image
Mobile app engagement ads drive existing app users directly from
News Feed into your app with a strong call-to-action button.
Mobile app engagement ads offer:
• A large, clickable real estate in mobile News Feed
• Strong call-to-action buttons – Use App, Play Game, Watch
Video, Open Link, Shop Now, Listen Now, and Book Now
• The ability to direct users to a specific location in app
Creative specs for mobile app ads
• Recommended text count: 90 characters
• Recommended image ratio is 1.91:1
• Recommended image size is 1200x627px
Creative specs for mobile app ads
• Recommended text count: 90 characters
• Recommended image ratio is 1.91:1
• Recommended image size is 1200x627px
Mobile app install ads
Drives installs for your mobile app
Mobile app engagement ads
Drives conversion in and retention for your mobile app
9 Direct Response Marketing on Facebook
Bid types
Facebook offers a variety of bidding options to help you pay
the right amount per objective and deliver your ads to the
right audience. The 4 bidding options offered are cost per
impression (CPM), cost per click (CPC), optimized cost per
impression (oCPM) and cost per action (CPA).
Cost per 1000 impressions (CPM)
Use CPM if your objective is to drive impressions of your
ad. If you care about clicks or conversions and you’re
targeting a very specific or highly targeted market, you can
also bid CPM to gain greater reach for your ad.
Impressions
Clicks
Conversions
Installs
Impressions
Clicks
For CPC with link ads,
you pay for clicks on
links, likes, comments
and shares.
For CPC with mobile app
ads, you pay for clicks to
the app store.
Impressions
Installs
Impressions
Impressions
Conversions
Installs
You value You pay for We optimize for
Cost per click (CPC)
CPC is a good option for advertisers targeting a very
specific audience. For example, if you want to target your
highest LTV customers, you could use CPC bidding to serve
ads to your entire audience rather than those likely to
convert.
Optimized CPM (OCPM)
oCPM enables you to specify the action that you care most
about and set a target bid for that action. Facebook will
then optimize delivery and bid aggressively to serve ads to
users we believe are most likely to take that action.
Cost per action (CPA)
Designed for mobile app ads campaigns, CPA biding will
efficiently spend your budget by delivering ads to users
who are most likely to install your mobile app. With CPA,
you have full control over what you spend per action and
our system will deliver the results you care about.
10 Direct Response Marketing on Facebook
Measurement
Measure the performance of your campaigns with Facebook’s
measurement solutions.
Facebook conversion pixel
Measures website conversions
When driving traffic to your desktop or mobile website, the Facebook conversion pixel will measure
how your ads perform and provide the granular data needed to optimize your ads. The Facebook
conversion pixel will also enable you to utilize other Facebook solutions that leverage pixel data such
as Custom Audiences from your website and oCPM bidding.
The Facebook conversion pixel measures:
• Your cross-device conversions on Facebook
• Any interaction with your ad, such as clicks on the photo, like button, comment button and
share button, as click conversions
• Conversion activity within a 1-day, 7-day or 28-day window based on time the ad is shown
While Facebook provides its own conversion pixel for tracking, you can also implement a third-party
pixel for measurement beyond Facebook. Generally, third-party pixels will measure:
• Granular data outside of Facebook such as LTV, KPIs and multi-touch attribution
• Click conversions as clicks off of Facebook
• All other clicks prior to a conversion as a view conversion
• Data across channels with minimized redundancies
• Data when the conversion takes place within a predefined attribution window
Facebook SDK and App Events
Measures mobile app conversions
The Facebook SDK or Mobile Measurement Partner’s SDK will measure the granular data needed
to optimize your mobile app ads to meet specific goals. You will need to measure in-app actions to
optimize budgets for actions that matter. You can do this via Facebook App Events or through a Mobile
Measurement Partner.
The Facebook SDK and App Events enable:
• The ability to measure any action taken in your mobile app ad such as an install or a purchase
• Conversion activity within a 1-day, 7-day or 28-day window based on time the ad is shown
• Rich people-based insights such as who buys the most in your app via App Insights
While Facebook provides its own SDK for tracking, you can also implement a third-party measurement
solution. Generally, our third party mobile measurement partners measure:
• Cross ad network ad spend
• Deeper downstream performance metrics and analysis such as funnel analysis
“We were able to identify the
type of consumer who will
convert, profile that, and use
this to find more people to
serve those New Feeds adverts
to,”
—Henry Arkell, Social
Advertising Director, Manning
Gottlieb OMD.
Facebook case study, April 2014
11 Direct Response Marketing on Facebook
Solution by Objective
This is our recommended solution set for marketers looking to
acquire customers or remarket to existing customers online,
in-store and in mobile app.
Acquiring new
customers
Acquiring new
customers
Acquiring new mobile
app users
Core Audiences
Custom Audiences
Lookalike Audiences
Core Audiences/
Partner Categories
Custom Audiences
from your website
Lookalike Audiences
Core Audiences
Custom Audiences
Lookalike Audiences
Custom Audiences
Custom Audiences
Custom Audiences
Link ads in New Feed
Link ads in New Feed
Photo ads
Offer ads
Mobile app install ads
Link ads in News Feed
Link ads in News Feed
Photo ads
Offer ads
Mobile app
engagement ads
oCPM
CPC
CPM
CPM
oCPM
oCPM
CPC
oCPM
CPC
CPC
Conversion pixel
Conversion lift tests
Conversion pixel
Conversion lift tests
Facebook SDK + App
Events or third party
mobile measurement
partner
Facebook SDK + App
Events or third party
mobile measurement
partner
Targeting
Targeting
Targeting
Ad units
Ad units
Ad units
Bid types
Bid types
Bid types
Measurement
Measurement
Measurement
Remarketing to
exisiting customers
Remarketing to
exisiting customers
Remarketing to existing
mobile app users
Driving online traffic from Facebook
Driving in-store traffic from Facebook
Driving mobile app installs and conversions from Facebook
12 Direct Response Marketing on Facebook
Best Practices
13 Direct Response Marketing on Facebook
Campaign Prep
Planning your campaign
As you plan your campaign on Facebook, you can start by asking yourself a few questions:
• What are the business goals I’m seeking to achieve and how do they map to the objectives I
can drive on Facebook? For instance, your business goals could be acquiring new customers or
remarketing to existing customers.
• How will I measure and track results? Before launching your campaign, identify what metrics will
be measured so you and your partners can work towards the same goal.
The answers to these questions will define your strategy and help you measure the effectiveness of
Facebook alongside other direct response channels.
Next, follow these steps:
• Align Facebook with your other efforts on digital
From account planning to the KPIs metrics you’ll measure, leverage the same processes and best
practices for an apples-to-apples comparison between channels.
• Consider long-term success metrics
It’s not too early to set long-term goals for your program. Consider metrics such as lifetime value
(LTV), downstream value, average order value (AOV) and share of new customers.
• Leverage your fans
Your business will benefit from having more people who like your Page since Facebook ads show
social context, which increases the efficacy of your ads. Audience Insights from your Page such
as geographic, demographic and interests data can also enhance your ability to target the right
people and refine your creative for specific campaigns.
Campaign structure
Facebook’s campaign structure makes it easier for you to organize, optimize and measure the
performance of your ads. The structure has three levels: campaign, ad set and ad.
Campaign best practices
1. Set up campaigns based on advertising objectives
2. Create multiple campaigns within an ad account
3. Cap spend across all campaigns and track spend for each campaign
Ad set best practices
1. Organize ad sets by audience segment
2. Optimize top performing placements
3. Set bidding to maximize performance
4. Adjust budgets to optimize spend
Ad best practices
1. Use ad types that match your campaign objective
2. Create multiple ads to optimize performance
3. Improve the performance of your creative
4. Don’t go over the limits for number of campaigns, ads sets and ads
Campaign
Ad set Ad set
Ad Ad Ad Ad
14 Direct Response Marketing on Facebook
Set up for measurement
To measure the success of your program, you will need to set the proper measurement
solutions in place.
1. Know which KPIs (ROAS, average order value, conversion rate, etc.) you want to
measure and what metrics you consider a success
Make sure your partners (agency and/or PMD) are informed of these success metrics.
2. Bring your conversion data onto Facebook
To track online conversions, implement the conversion pixel on the your website.

To track conversions in your mobile app, implement the Facebook SDK and set up App Events
to measure specific actions in app and attribute ad spend to specific in app actions.
3. Identify where the majority of conversions happen
Looking at your data, identify where the majority of conversions occur. If you notice that more
conversions occur on desktop than mobile, then increase spend on desktop and use the appropri-
ate ad units and creative to drive your desired action.
4. Set up measurement for lifetime value (LTV)
It’s not too early to set long-term goals for your program. Consider metrics such as lifetime value
(LTV), downstream value and share of new customers.
5. Partner with a third-party solution for cross-channel measurement
Encourage advertisers to implement third-party measurement solutions to measure the
path-to-conversion for their customers and the impact Facebook has compared to other
channels. Because Facebook ads can drive consideration from consumers, a last-click
attribution model is not an appropriate measurement solution.
15 Direct Response Marketing on Facebook
Targeting
With the right targeting strategy, you can reach consumers on Facebook
in meaningful numbers to drive scalable results across devices. Though
Facebook has more targeting options than other channels, the same
audience planning process applies.
Think about the goal you’ve set for your business on Facebook. Are you acquiring new customers or
remarketing to existing customers? Your objective will define the audience you want to target. Ask
yourself the following questions to help develop your audience strategy on Facebook:
• Who are your target audiences?
• How do you segment your audiences? What types of data/insights do you have about them?
• What are your key focus markets now and in the future?
• Who manages your CRM database? How do you use your database for marketing purposes today?
• What offline data do you use for targeting in other campaigns?
These questions should help determine what audiences you want to reach on Facebook. Next, use
Facebook targeting to find your audience.
Recommended targeting solution by objective
Driving online traffic
Driving in stores traffic
Driving mobile app installs and conversions
(Partners Categories) (Custom Audiences from your websites)
Core Audience Custom Audiences Lookalike Audience
Acquiring new customers
Acquiring new customers
Acquiring new mobile app users
Remarketing to existing customers
Remarketing to existing customers
Remarketing to existing mobile app users
16 Direct Response Marketing on Facebook
Best practices for targeting
Use the following best practices to efficiently reach the people in your target audience.
1. Reach audiences based on where they are in the lifecycle
Identify audiences by where they are in the lifecycle. For example, remarket to people who demon-
strated purchase intent on your website, target existing customers who are likely to churn and
reach your highest LTV customers to keep them engaged.
2. Minimize overlapping audiences
Overlapping target audiences mean multiple ads are competing for the same auctions, thus canni-
balizing the delivery for your campaign.
Consider consolidating target audiences into larger but fewer audience segments. Also, evaluate
the timing of ad sets as they may not need to run at the same time
3. Use Audience Insights and App Insights to better understand the demographics of your
most engaged audiences
Advertisers can leverage data from Audience Insights and App Insights to identify audiences that
may be interested in purchasing their products and are most engaged.
4. Exclude current customers from acquisition campaigns
If you’re running a campaign with the goal of acquiring new customers, use Custom Audiences to
exclude your existing customers from your campaign.
5. Use specific seed lists to build lookalike audience
When building a lookalike audience, start with a seed list that is specific to the objective you’re
seeking to achieve. For example, build a seed list of people who tend to convert online versus
offline and find people who look like them.
Success Story
20Jeans used Custom
Audiences to remarket to
people who abandoned their
shopping cart on their website.
Result:
Saw a 300% decrease in CPA
and a 2-3X higher conver-
sion rate than other display
platforms
Facebook case study, June 2014
17 Direct Response Marketing on Facebook
Creative and messaging
After you’ve identified your goal and target audience, reach them
with compelling creative that drives them to your website, store
or mobile app.
Great creative drives engagement and can sometimes lead to higher delivery and cheaper costs. Take
advantage of the visual and native canvas in News Feed to drive your direct response objectives.
Best practices for direct response creative
1. Stick to one strong focal point
Keep to one focal point within your creative so that it’s obvious to your audience what your
objective is. For example, if you’re a retailer, showcase the product you’re looking to sell and
provide a clear directive within the ad.
2. Make your ad noticeable
Use creative that captures attention and gets people to stop scrolling through their News Feed.
3. Insert brand personality
Add your brand personality into your creative. For example, insert your logo or stick to colors
from your brand.
4. Create informational reward
Make sure the product or service you’re promoting is something the audience might be interested
in. For example, an events business can promote tickets for a concert to people who have previ-
ously purchased concert tickets from their website.
5. Create emotional reward
Think of ways to connect with your audience emotionally. Humor is a great emotional trigger.
6. Mirror creative to where your audience is in the sales funnel
If your audience is in the consideration phase, use creative to drive interest in your products or
services. If your audience has demonstrated intent on your website, use creative with a strong
call-to-action to drive the outcome you care about.
7. Use a strong call to action
Vital to direct response campaigns, ensure you have a single, clear call-to-action that drives the
objective you’re looking to achieve on Facebook. Do not confuse the call-to-action by asking them
to purchase a product and like your Page.
8. Create consistency across the path-to-conversion
When driving a conversion on your website or mobile app, keep the look and feel of the experi-
ence seamless from the ad itself all the way to the conversion page.
9. Consider refreshing the creative
Campaigns will begin to fatigue over time given the frequency with your target audience. Review
performance over time and update creative often to maximize results.
10. Test, test, test!
Ensure you’re using the best performing creative by testing continuously.
18 Direct Response Marketing on Facebook
Bidding
Facebook’s auction is designed to give you the least expensive
delivery possible regardless of your bid. On Facebook, the bid is
assumed to be the value (e.g. revenue) captured from each click,
impression or action.
Prices are calculated based on the position won in the auction and the weighted average of your
competitors’ bids. This means that the price charged is almost always less than the bid. Figure out
what the max bid is by calculating the average profit from a click or action (this varies by target
audience, and possibly other factors, and should be adjusted over time).
Best practices for bidding
1. Bid your true value
Bid the maximum amount you’re willing to pay per objective.
2. Increase your bid if you’re willing to pay more per objective
You will almost always be charged less than your bid. So if you’re willing to spend more, increase
your bid to maximize delivery.
3. Set accurate end times for your ad sets
You might get slower delivery if the system thinks it has to spread your spend out over a long
period of time.
4. Set different bids for low and high LTV users
Create different LTV audience segments. Bid higher for people that bring more value in the long
run, while bidding less for people that have a lower LTV.
5. Don’t change bids and budgets too frequently
Fluctuations in bids may affect delivery.
6. Don’t try for the cheapest clicks or impressions
You will reach people that are easier reached, but don’t necessarily provide the LTV you expect.
In addition, you might not be able to scale your campaign properly.
Pricing
We charge you based on:
• The position you win in
the auction
• The weighted average of
your competitors’ bids
19 Direct Response Marketing on Facebook
Measurement
For a complete view of your efforts on Facebook, we recommend
a combination of measurement solutions:
• Track your Facebook ad performance with the Facebook
conversion pixel and SDK
• Measure the incremental lift you receive from advertising on
Facebook using conversion lift tests
• Utilize third-party tracking and measurement to determine
attribution across publishers
Track Facebook ad performance online and in mobile
Properly measuring and optimizing your ad campaigns is a core to success on Facebook. The Facebook
conversion pixel or App Events should be placed on each key aspect in the conversion flow.
By placing the conversion pixel/App Events across the funnel, you will be able to test several optimiza-
tion techniques that could lead to additional conversions. In addition, you will be able to measure the
downstream effect of our ads in relation to key conversion events.
General remarketing
Lead generation
Mobile app installs
Mobile app re-engagement
Loyalty
Upselling
Fan acquisition
Retention with lapse customers
Main landing pages, search pages, category pages
Main landing pages, loyalty/rewards pages, newsletter pages
Activate App and App Purchase
Activate App, App Purchase, Add to Cart, Initated Checkout
Loyalty/rewards pages
Category/product pages
Main landing pages
Loyalty/rewards pages, shopping cart
(exclude purchasers via Custom Audiences pixel on checkout/
thank you pages)
If your goal is... You should apply the pixel/App Event to...
20 Direct Response Marketing on Facebook
Conversion lift test
Lift measurement determines the true incremental impact you receive from your advertising efforts by
comparing a test group of people who saw the ads to a control group who didn’t see ads. While brand
advertisers care about determining the lift in awareness and perceptions, direct response advertisers
care about driving actions, events and conversions, so we measure the lift in these key actions.
Conversion lift measurement is a true experimental design approach which enables advertisers
to determine the value of all Facebook impressions (views and clicks) beyond the last touch and
determine the incremental impact Facebook advertising had on their business.

How to implement a conversion lift test:
1. Before uploading your Custom Audience from a data file to Facebook, randomly divide
your audience into two groups
This creates a test group and a control group. Only include people you want target for your
specific objective. For example, if you’re a travel company promoting hotels to people who
recently booked airfare, run a conversion lift test to people within that campaign.
2. Upload the two groups as separate Custom Audiences
Do not make any changes to the Custom Audiences during the test to maintain accuracy.
3. When running your campaign, only show ads to the test group
Make sure to exclude the control group from your campaign. Make sure to reach more than
75% of people in your test cell to get a good read on the impact of your advertising.
4. Analyze your point-of-sale data from both groups
When measuring the results of your campaign, look at the data of all people within your test
and control group.
5. Calculate the lift between the two groups
Compare the delta in conversion rate and sales volume between the test and control group.
For more information on conversion lift tests and details on our managed conversion lift test solution,
reach out to your Facebook contact.
21 Direct Response Marketing on Facebook
Whether you are a new or experienced advertiser on
Facebook, we hope this guide provided helpful tips to improve
the performance of your campaigns. In summary, keep the
following recommendations in mind:
• Use the recommended suite of Facebook ads products that align with your direct response objectives
• Ensure your campaigns are structured efficiently according to Facebook’s best practices
• Use compelling creative with strong call-to-actions to drive attention and conversion
• Follow Facebook’s bidding best practices to ensure you’re paying the right amount per objective.
• Use the Facebook conversion pixel and/or SDK as well as experimental design tests for a complete
view of your ad performance.
• Test targeting, creative, placement, ad unit and bids often to optimize for better results.
For more information about Facebook Advertising, visit facebook.com/business.
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