Two Positive Early Observations of Facebook Exchange Performance
Published: October 8, 2012
Author: Ruben Sanchez
In my previous post on the Facebook Exchange, I explained how advertising via the Facebook Exchange differs from Facebook marketplace ads, which are driven by interest- and demographic-based targeting.
The expectation was that the Exchange would make Facebook a legitimate performance marketing channel because retargeting campaigns take advantage of user specific behavioral data.
In general, past behavior is a stronger predictor of future behavior than mere interest. But would that generalization hold true on Facebook despite reports of increasingly expensive clicks due to banner blindness and low conversion rates for Facebook audiences?
The following graphs detail performance for a client who launched display retargeting campaigns over the previous week.
Here are two very early observations on Facebook retargeting campaigns via the Exchange and how they compare to traditional interest-based campaigns.
1. There is an immediate return on investment
Traditionally, Facebook interest targeting requires testing in order find an audience that converts. Conversion data is usually thin in the beginning of a campaign. As such, it takes longer to gather enough data in order to optimize interest targeting as well as change bids to maximize results for the given advertising budget.
To date, the spend-to- sales ratio for FBX has not matched that of overall retargeting campaigns. Nevertheless, retargeting campaigns on Facebook are immediately producing sales results. These early results give us confidence that Facebook retargeting campaigns can be optimized for better performance.
2. Early click-through rates are holding steady for a portion of the audience
Basic Facebook advertising wisdom says that targeting and ad creatives must be updated in order to combat ad fatigue and maintain steady performance.
Depending on the size of the target audience, click-through rate for a specific campaign can drop significantly over the course of a week.
We see that over the course of a week, the CTR for potential customers who abandoned carts decreased 20% over the week. However, CTR held steady for Facebook users who had simply visited the client’s homepage. The steady CTR may signify that Facebook display campaigns are also effective at overcoming banner blindness and maintaining interest over an extended period of time. That’s speculative, but I look forward to sharing additional results in the future.
– Ruben Sanchez