1. Targeting

Targeting is the top criteria that you need to know. According to Social Fresh’s report, age, country, and precise interest are the most important targeting criteria.

Personally, I too would rank those three as the most important criteria. Having said more, the definition of ‘precise interest’ should be focused more as Facebook users have different interests.

For example, if you’re a restaurant owner and you have a lot of sport fans as your diners, you could test by targeting different types of sport, different teams, and even different beer brands as beer brands are often associated with sports.

2. Refresh ads

Rotate your ads subsequently to get the best out of Facebook! According to the report, advertisers aren’t refreshing their ads enough.

31 percent of advertisers refresh their ad every 1-4 days, 37 percent over the span of 5-14 days and over 32 percent more than 15 days.

Advertisers are making a huge mistake by not refreshing their ads.

When ads continue over a long period of time, they become stale because most users on Facebook have seen them. This would then reduce the click through rate (CTR) of your ad and increasing the cost per click (CPC). All in all, it’s safe to say that you would be paying more per click if you don’t refresh your ad often enough. From an advertiser’s (you) point of view, this is a sign of bad investment. Luckily enough, it is one that is easy to improve.

Justin Kistner summarizes:

“Social has a voracious appetite for creative, and ads need to be refreshed 2-3 times per week – another good reason to partner with agencies, who can keep up with the flow. – Justin Kistner, Director of Social Products at Webtrends”

I personally prefer to refresh ads every 2-3 days and I find that my CTR goes down on the 3rd and 4th day.

3. Try different ads

On Facebook, advertisers can create different types of ads. Advertisers can choose to advertise via sponsored stories or through a normal ad.

In the report, 55 percent of respondents were not using Sponsored Stories, and this is being underutilized according to Dave Kerpen, CEO of Likeable Media and author of Likeable Social Media Book. Sponsored stories are a great option for driving word-of-mouth.

Having tested sponsored stories for my business I found that the percentage of people who ‘liked’ my page reduced. This happened despite seeing an increase in CTR and reducing CPC. So perhaps this is a window for a different strategy on Facebook, seeing as some brands prefer to have a lower CTR and CPC after reaching their desired amount of ‘likes’ for their page.

4. Split testing ads

Another insight from the report was that only 66 percent of respondents are split testing their ad creatives, which means the remaining 34 percent of advertisers aren’t split testing their ads at all. These 34 percent aren’t getting the most out of their ads as their initial advertisement could be ineffective and they could blow most of their budget to bankroll that ineffective advertisement.

For those who have tested their ad, this was what they were testing:

Ineffective Ad + Ad Lifespan = Over-Blown Budget = Nightmare = leaves Facebook ads.

I personally tend to put more focus on ad targeting to target different precise interests as I find different interests help to increase the CTR of the ads. After finding the most suitable interest, I’ll then test the ad creatives.

Facebook Ads is definitely a step-by-step process that brands need to be aware of. However, once you eliminate the ineffective measures, your brand will be able to focus on the most lucrative ad target and you would definitely see the difference on your Facebook page.

5. Point to your Facebook page

To help you reduce your CPC, you should point your ad to your Facebook page instead to your website. According to the report, the difference between those who pointed their ad to their Facebook page and those pointing externally was a huge 0.38 cents per click.That is nearly 4 dollars difference for every 10 clicks.

Download the full 2012 Facebook Ad Report from Social Fresh for more analysis and tips from their survey of 347 experienced marketers.

Respondents were, on average, 34-years-old, with over eight years of marketing experience. They had been managing Facebook ads for an average of two years, with 42 percent working in-house for brands and 58 percent coming from agencies or vendors.

In conclusion, don’t throw your budget away at low performing ads. You need to run tests to find the best performing ones and focus more on that. I am a huge believer in Facebook ads as I’ve seen how it has helped me.