Why Most Advertisers Almost Always Lose Money Or Break Even On Facebook
Pedro Campos
Senior Paid Media Buyer ? Performance Marketing Manager ? Growth Marketer ? Customer Acquisition Specialist
There are 42 million active Facebook pages.
Only 7 million advertisers are on the platform.
Out of those 7 million, probably 70% are leaving money on the table. Why?
That`s exactly what we`re going to dissect from now on.
These are the main reasons why most advertisers almost always lose money or break even using Facebook ads.
Lack Of Market Research
This is the most important thing you`ll ever do before launching any advertising campaign.
Researching your audience is crucial for your success, especially when we talk about contextual advertising which is the case with Facebook.
Contextual advertising means that people aren`t searching for something to buy, as opposed to Google.
How are you going to craft copy that converts if you can`t talk your prospects` language? Almost impossible!
The research phase gives you essential pieces of data you can use to craft effective ads.
(RELATED: How To Win With Facebook Advertising In 2020 And Beyond)
Not Understanding Audience Awareness
Most Facebook advertisers believe their audience has the same level of awareness. This couldn`t be further from the truth.
In his famous book "Breakthrough Advertising", Eugene Schwartz described the 5 levels of audience awareness.
He basically explained that at any given moment in the marketplace there are people who:
- are NOT aware of a problem
- are AWARE of a problem
- are aware of a SOLUTION to the problem
- are aware of YOUR solution
- are ADVOCATES of your brand (most aware)
What most advertisers wrongly do is position their product or service the same way for every level of awareness.
This not only makes your advertising a lot less effective but also very costly!
"Sometimes you have to lose money in order to figure out what works."
Bad Offer
Seldom, they go even further on the "burn money scale" by promoting a bad offer.
An offer that people don`t want is the number one reason why most advertising campaigns fail.
You can only offer something that people want if you research your market and know what specific problems you`re solving.
By offers, I mean lead magnets, small-dollar products or high ticket.
Fitness experts say you can`t "out-work" a bad diet, I say you just can`t "out-advertise" a bad offer!
(RELATED: 5 Common Ways To Burn Money With Facebook Ads - Which Ones Do You Want To Avoid?)
Not Getting Granular With Data
I`ve made this mistake myself... used to look at a few metrics in the ads I was running and carry on with my life.
When there`s money involved and you`re trying to get an ROI, you cannot take a lazy approach to data analysis. You must get granular!
You can`t just look at cost-per-lead, for example. Dive deep and look at what placements, ad copy variations, ad types, countries, etc, are performing or not and why.
Once you find out what doesn`t work, it`s easier to get faster results next time you run a similar campaign.
"Out of 7 million advertisers on Facebook, probably 70% are leaving money on the table."
Making Emotional Decisions
I get it. It`s your money on the line! Sometimes, you can get emotional and do dumb things. I`ve been there, as well.
But successful advertising is not emotional, it is logical. Therefore, you must drive all your decisions based on data alone.
You need to get your money mindset right and understand that sometimes you have to lose money in order to figure out what works.
Stop turning off or tweaking campaigns every day! Give it some time and let the data tell you what to do next.
Want To Be In The Top 30%?
If 70% of all advertisers on Facebook are leaving money on the table, by now you should already know what they`re not doing.
This isn`t a fairy tale! I`ve made all the mistakes above myself and don`t want you to fall into the same trap.
To be in the top 30%, you have to be intentional about your Facebook advertising.
And remember that intention is always greater than the method.