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Advertising on Facebook: Good or Bad for Small Businesses?

Not very long ago, whenever we wanted to “know more” about a company or a service, the first thing we used to do was look it up online or simply “Google” it. But, now we might consider the alternate option, which is digging into the Facebook profile of the company.

With over 800 million potential Facebook users and more than 50 percent active users on any given day (Source: Facebook’s Press Room), Facebook has become a power tool for all businesses.

Almost all big companies like Nike, Toshiba, HP, Burger King and Armani own a Facebook profile, with small businesses following the lead. However, the most pressing concern for small businesses is “whether it’s a good idea to spend on Facebook advertising or not!”

A case study on CM Photographics, a photography agency for covering wedding events, indicates a revenue generation of $40,000 by spending just $600 on Facebook marketing. Similarly a storage company, Store Quest Self-Storage, saw a 50 percent increase in rental revenues by putting up advertisements on Facebook, as compared to that generated the prior year. These success stories definitely indicate the efficacy of this social medium.

But, some of the small business owners were also seen unhappy with their Facebook advertising campaigns. The key behind a successful Facebook business campaign is to understand the dynamics of this medium. Once you get to know the right techniques for advertising on Facebook, it is definitely a good idea for small businesses to go for it.

When a company is starting off from scratch, or is new to social media campaigning, it is advised not to spend too much on Facebook advertising right away. Since Facebook advertising is a trial and error business to begin with; the company should start off by spending a small amount at the beginning.

Facebook offers business-friendly advertising packages for small businesses. Marketers can choose the target audience, the specific timings of the day when they want the advertisements to pop up and they also have the freedom to choose the budget allocation (pay per click or in bulk). This way the marketers can allocate a low budget while initiating the campaigning, testing the results of the campaign on different demographics and later altering the campaign accordingly.

As compared to other online advertising forums, Facebook is also a great place to publicize websites, events, blogs or any other activities of public interest. Reason being that the privacy settings on Facebook allows the users to choose their exposure to different people, groups or interests. Thus, when users themselves indicate their inclination towards different interests, it is easier for the marketers to filter the traffic, and target the relevant audience.

Moreover, it has been recorded that Facebook has a higher traffic inflow as compared to Google, another added advantage that the marketers can utilize. Also, as compared to the advertisement word limit on other mediums, Facebook offers a word limit of 25 characters for the title and 135 characters for the body, thereby making it more business friendly.

Though Facebook users are more inclined towards socializing, sharing their pictures and planning social events, by just adding an image and an appealing introduction phrase to the Facebook advertisement, anyone can publicize their page, website or event.

Facebook is good for small companies for its cost-effectiveness and a larger target audience. And like any other marketing medium, Facebook requires some serious time and effort. Putting up an advertisement without much research and planning, might just go to waste. Facebook advertising is only good for small business marketers if they take it seriously!

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About Farhan Niazi

Farhan Niazi is an experienced web developer with a passion for blogging. He lives in Auckland, New Zealand and is currently working for McCarrison Hayes as their Chief Information Officer. He is the founder of SMB Tech Guide and writes for several blogs and magazines including Two's Company, Stirring Media and TMR Direct. Follow him on Twitter.

6 thoughts on “Advertising on Facebook: Good or Bad for Small Businesses?

  1. avatarEnve Creative

    We just started running Facebook ads again. I find them to not be as effective in driving people to a website’s landing page / intake form, but very effective to get more “likes” for your page. Then you can market to them time and again. 

    Reply
  2. avatarSteve Hippel

    I have recently started my own web design / SEO company. I have not been using faceBook for long but I’m already seeing a steady rise in results. I also set up FaceBook business pages for some of our clients. In the UK, businesses seem reluctant to advertise on FB. Those that do, often just set up with only the basic page and seldom post on it. It’s a real shame because with just a little effort, you can increase business and have some fun. Not to mention, meet some good new contacts. A good professional page makes you stand out from the crowd who mostly have a bland wall.

    Reply
  3. avatarAsh

    Facebook is not a good investment for small businesses and it is explained in this ad.

    http://www.forbes.com/sites/elandekel/2013/01/22/facebook-pages-are-a-bad-investment-for-small-businesses/

    What the ad I mentioned is saying is true. FB not only charges you to build likes for your page but when you post fb does not show your post to those who have liked your page. FB forces you to pay again to have the post visible to them. I do not recommend using FB as an advertising medium. http://www.arcticboutique.com

    Reply

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