Why Facebook is helping advertisers grow their businesses
Why Facebook shows strong growth but the stock is still expensive (Part 3 of 5)
Facebook’s investing to improve and expand its ad networks
In the previous article of this series, we discussed Facebook’s (FB) advertising revenue growth rate compared to its competitors. We found that only Twitter (TWTR) has higher advertising revenue growth rates, while Yahoo (YHOO), Google (GOOG), and LinkedIn (LNKD) lag way behind Facebook. As the graph below shows, Facebook has managed to consistently grow its advertising revenues over the last few quarters despite a larger base. Here, we’ll discuss how Facebook is helping advertisers grow their business. Facebook mentioned that investing to improve and expand its ad networks remains a high priority. Its goal is to continue to develop new ways to help marketers reach their customers. To achieve this goal, Facebook has started to enhance its targeting capabilities, simplify its ad products, and improve its measurement tools.
Facebook’s helping advertisers target the right customers
Facebook’s management mentioned that marketers value Facebook’s proprietary targeting to help them reach the right customers and create more personalized, and therefore more efficient and effective, ad campaigns. For example, Ben & Jerry’s wanted to drive more sales from its classic flavors. It used a wide range of Facebook’s targeting capabilities, including Custom Audiences and Partner Categories, to reach premium ice cream buyers. The campaign reached 14 million people—roughly 90% on mobile devices—and drove an 8.1% sales lift from those consumers.
Facebook’s simplifying and enhancing ad tools to reach more advertisers
Facebook is simplifying and enhancing ad tools for over 1million advertisers. Tools such as Custom Audiences and Partner Categories were previously available to only the biggest and most sophisticated advertisers but are now available in Facebook’s self-service ad creation process. Plus, for direct-response marketers, Facebook has added specific calls to action in its ads, including “buy now” or “install now” buttons that improve the efficacy of these ads.
Facebook’s measurement tools help advertisers measure the impact of their ad campaigns
Facebook’s management mentioned that its online conversion measurement tools enable the company’s direct-response advertisers to measure the impact their Facebook ad campaigns have on online sales. Facebook also mentioned that it has recently launched new offline conversion tools to measure in-store sales that have yielded positive initial results.
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