For instance, promotions that waive the joining fees don’t work as well in affluent areas. Campaigns that market an eight-week challenge program are often more effective in these locations.
A campaign Gunning ran in January for his Caulfield gym produced the best results so far. It generated 21 new members, producing a return 15 times the spend for the month, based on a member’s lifetime value, calculated using average monthly fees multiplied by the average tenure of 46 weeks. The other two gyms’ campaigns achieved about half that.
Peter Harris, chief executive of marketing platform Digital Stack, says $1000 a month is the minimum you need to spend to make Facebook marketing worthwhile, with some clients spending up to $20,000 on a campaign over two to four months.
“For multi-location businesses, cost is generally lower because you usually aren’t starting from scratch and you can use lessons from previous campaigns and localise the execution of an individual campaign,” he says.
Harris warns small businesses that use marketing agencies to execute their marketing campaigns to understand the cost structure.
“Agencies generally charge 20 per cent of the media spend plus a set-up cost for strategy and planning. So a $1000 campaign would be split $800 on Facebook ads and $200 would go to the agency.”
Harris says if you are using an agency, ask how often the campaign will be reviewed and optimised.
He says a standard initial campaign will last about six weeks and will cost between $4000 and $5000, with the opportunity to tweak or “optimise” the campaign three or four times.
The longer you stick with it, the more information you gather on what works.
As an example of how a campaign may be optimised, data may reveal clicks made by women have a 30 per cent higher conversion rate compared to men. So the campaign may be optimised or changed so that only women are shown the ads.
“Be crystal clear on your campaign objective. Whether it’s generating new sales, growing awareness of your product or changing perceptions, you need to be able to measure it,” Harris advises.
He says it’s essential to constantly test whether the campaign’s objectives are being met and suggests “split testing” campaigns with other marketing channels such as Google AdWords, as well as the campaign’s approach and landing pages.
Split testing is also known as AB testing and involves comparing the results of two different marketing methods. For instance, a gym might show two different ads to the same audience and then measure which one is more successful.
“You can waste a lot of money if you are chasing a low cost-per-click without having regard for the quality of the clicks and subsequent online sign-ups,” Harris says. He warns against buying junk traffic by going for a low cost-per-click and generating eyeballs that are not really interested in what you’ve got to sell.
Finally, it’s important to make sure a campaign is producing results before allocating serious budget to it.
Says Harris: “If you’re using an agency tell them straight up how much you want to spend testing the campaign and how much you will spend if clearly defined KPIs and results are achieved. That’s the best way to do it, assuming your testing budget produces enough data to inform a bigger campaign.”
What’s your experience marketing on Facebook? Share your story in the comment section below.
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