Does Facebook advertising still work for e-commerce?

The short answer is YES, of course, it bloody does! But things have changed...

Over the past couple of years, we have experienced huge shifts in this industry, most notably the impact and aftermath of the pandemic (the good and bad) and the Apple iOS14.5 update.?

Let's go back to the good old days of 2019...

A wonderful time for Facebook advertising... A time when we had more data at our disposal to find, reach and connect with our ideal customer. It was a less crowded space of 'digital marketers', there wasn’t as much competition for our clients, and there was no sense of impending doom that the world was about to change forever, the list goes on.?

Facebook advertising (and digital marketing in general) was, of course, complex in 2019. It was imperative to work with the right agency/marketing expert to drive results and make a significant change for your business. BUT we didn't have the barriers that were about to come into play to make this world even more complex.

In 2020, the pandemic hit. For everyone, this was a scary time personally and professionally. At Pink Leopard , like most businesses, we had to think quickly about the agency and how we navigate this colossal event that was quite literally changing the world at breakneck speed.?

At the time, we worked on a mixture of e-commerce and lead generation projects. We were on a fantastic upward trajectory but this came to a halt for the businesses we were in partnership with for lead generation (predominantly gyms and beauty clinics) as they were forced to close their doors. This wasn’t the end of the world for us because of our e-commerce experience but it did present us with a heavy loss of clients for lead generation.?

What do we do now? Firstly, the right thing. We paused all advertising for our gym and beauty clinic clients and assured them that we wouldn't be holding them to their contracts because of the pandemic.?

But what about the agency? We’ve just lost a significant number of clients! My business partner and I quickly agreed that we needed to fully focus our attention on e-com.?

Wow! E-commerce BOOMED and the agency grew at a phenomenal rate.?

Why was the pandemic so good for Pink Leopard ? Well, we had the right team in place to attract and win new business and then provide a great service for our new clients by delivering incredible results for them. We skyrocketed our client accounts and scaled them through the roof! We were riding the crest of the e-com boom wave.?

We've always prided ourselves on the results we deliver but the pandemic helped drive even better returns for our clients. Why? Everyone was sitting at home, on furlough (so their income didn't change) and with not much else to do other than spend time on their devices - and, for many, shop. With people's attention fixated on social media through their phones and devices, we were able to capitalise on this and place ads in front of these people who had more time than ever to engage with the new brands we were presenting to them. Sales rocketed!?

Let's dive into the e-commerce boom further...?

A recent Forbes article highlighted the rapid growth of Shopify, a major e-commerce platform. “The Covid-19 pandemic has helped accelerate Shopify’s business, as customers increasingly turned to the Internet to buy things with more small businesses also investing in building online stores using Shopify’s solutions. For perspective, the number of new businesses on Shopify’s platform shot up 71% year-over-year in Q2 alone.” Blimey!

So at this point, everyone is having a tremendous time. New stores are popping up left, right and centre selling all sorts of weird and wonderful wares, and this community of new online shops are making hay. Let the good times roll! But then...

iOS14.5! Now, this is a real game-changer.?

The Apple iOS change mainly focused on user privacy and gave them more control over it. The update implemented a feature called App Tracking Transparency (ATT). ATT, lets users choose whether they want to be tracked on apps and websites while they’re using their Apple devices. With the update, any app that operates on an iPhone or Apple tablet is required to give users the option to be tracked or not. This determines if any app would be able to track a user’s activities as they browse the web or move to different apps within the iOS operating system.

Once a user has updated their device to iOS14.5, they will be presented with the option to opt in or out of tracking every time they open up an app for the first time. This comes in the form of a pop-up prompt, similar to the way they request access to photos, location, or your microphone.?

Why is this so important? For years, we marketers have leveraged being able to track users and target them with ads that are based on key events, interactions or behaviours. Potential customers could be presented with ads based on information regarding where they were in a sales funnel (cold, warm and hot). This update has made it more challenging to reach users with targeted ads if they opt-out of tracking AND it has had implications for retargeting.?

If a user opts out of tracking it does not mean that they will no longer receive ads – they would likely just be more random. By opting in, users would likely continue to see ads that are more relevant to their consumer behaviours and demographics.?

This is massive and frightening for the e-commerce world!

Lead and sales attribution and measurement are essential tools for reviewing the effectiveness of a business’ marketing and advertising efforts. By knowing which pieces of content or ads are generating more customers to the point of sale, we can achieve a better understanding of our customer's behaviour. This information also helps us find ways to fine-tune a marketing approach to maximise a return on investment. This has now been removed, in part, meaning it is more difficult to strategise and report.

To help understand this further, you can take a look at this article from Facebook's Business Help Centre .?

We are now at a point where we have less data to connect with ideal customers, a volatile Facebook platform as major changes to the backend are made, under-reporting and attribution losses. Well, that's just dandy!

Now, because 2020 was a boom time with an abundance of new online stores (and many people quitting their jobs to become full-time e-com folk), we have a community of business owners looking to grow year on year and build on the success of 2020.?

UH OH! The pandemic starts to come to an end, people are spending time seeing their families and friends (rather than looking at their phones), furlough finishes, people are losing their jobs and reality is hitting! On top of this, we have to navigate the iOS changes that have come into play.?

What does this mean?

Well, driving results on marketing platforms is harder and more expensive than ever and it can be tricky to fully prove a return on ad spend. This is especially true if you have chosen to use a platform in isolation and put all of your eggs in one basket. In our case, Facebook, because (as explained above) we don't have the same targeting capabilities as before and, more importantly, the attribution data to prove we are delivering - even though we are...

Let's think about this... A customer can reach your checkout after receiving multiple touchpoints about your brand and product. For example, they may see your product on Facebook, later Google it, receive an ad on Instagram, show an interest and upload their email address to subscribe and then later make a purchase after receiving an email with a great offer. Of course, the reporting shows that the sale was made after the email shot BUT there is a back story and a journey for this customer to reach this point that may no longer be attributed to any of the channels that assisted in the sale conversion.?

The problem here is (and we've had it A LOT!) we hear “Facebook ads don't work! Email marketing is where most of my sales come from!” Or “Google works really well! But social doesn't anymore!” It begs the question - how did you get access to the email address in the first place?! How were people prompted to search for your product?! Usually after being introduced to the brand on Facebook or Instagram - by far and still the biggest discovery engines for new brands and products in the world! There are 2.91 BILLION active daily users on Facebook globally (Statista ). Your customers are hanging out here.??

My point...?

Facebook ads still work extremely well and we have some wonderful clients to prove it BUT in this new age, an omnichannel and holistic approach is even more vital for the success of any e-commerce store (along with making sure that your website is performing, you are able to hold stock, deliver it, showcase good reviews, have strong copy, a good offer, an audience willing to actually purchase your product, interesting creatives, an email marketing strategy, oh and you are able to provide an excellent service for your customer).??

Do not look at your results in isolation, because the reporting is off (it really is!) Instead, look at your marketing spend versus what sales are reported in the backend because this is the source of the truth. Also, see digital marketing as holistic rather than Facebook against Google - these platforms work incredibly well in tandem.?

There are many moving parts to e-commerce and with the new digital landscape, it is more important than ever to be working with an agency or expert in this field who knows what they are doing. You must work in collaboration with your agency (they usually want you to win and are certainly not against you) and harness a variety of platforms to engage with your audience and generate sales.?

Facebook advertising and digital marketing are not going anywhere but we as marketers must adapt to continue providing great results for our customers - and this is with an omnichannel approach. Now is the time to adapt your business with a holistic marketing strategy to survive.?