The Formula for Effective Facebook Ads

The Formula for Effective Facebook Ads [REPORT]

Posted: 19 Apr 2010 09:00 PM PDT

In order to understand the value of a Facebook ad impression, Nielsen analyzed over six months of survey data from 800,000 Facebook users in response to more than 125 Facebook ad campaigns from 70 different brand advertisers.

The study — after analyzing reach via impressions and effectiveness of impressions — concluded that earned media and social advocacy contributed to Facebookers being much more likely to notice ads, absorb their content and make purchases.

Paid vs. Earned Media

In arriving at the aforementioned conclusion, Nielsen looked at three types of impressions on Facebook, and categorized them as either paid media, earned media or both.

Homepage ads: Homepage ads above-the-fold that contain ad creative as well as an option for users to engage with the brand (eg, "Become a Fan"). This is an example of paid media.
Social impressions: Homepage ads that include social context, like the names of users' friends who are already fans of the brand. This is an example of a hybrid ad that is both parts paid and earned media.
Organic impression: Social stories that appear on the homepage of friends of users who have engaged with a brand or become a fan of that brand. This is an example of earned media.

Earned media is being used to describe brand mentions on Facebook that are broadcasted/shared by the consumer, whereas the hybrid organic impression is a more calculated way to create earned media around paid media and better control the message.

The data clearly shows that the social advocacy of earned media played a substantial role in the performance of homepage ads on Facebook. According to the data, ad recall grew from 10% to 16%, awareness doubled from 4% to 8% and purchase intent quadrupled from 2% to 8%. That last metric is perhaps the most telling, and shows that when a Facebook user advocates for an ad, the ad is 4x more likely to result in a purchase.

In the organic impression department, Nielsen found that "those users exposed to both the 'paid ad' and the organic impression remembered the ad at three times the rate of those just exposed to the paid homepage ad," and that "homepage ads increased awareness of the product or brand by 4% on average, but exposure to both homepage ads and organic ads increased awareness by a delta of 13% versus the control group."

The bottom line is that the more the user was exposed to paid and earned media — with a combination of both packing a powerful punch — the greater the ad recall, awareness and purchase intent.

Tips for Advertisers

Nielsen recommends the following tips for advertisers looking to capitalize on their data:

Start with engaging homepage impressions; these will drive more organic impressions and the engagement rate goes up as the organic impressions go up.
Buy paid media on social networks; it's the catalyst for more earned media.
Balance reach and frequency across homepage, social, and organic impressions.

You can read the full report below for even more information and tips on how to leverage earned and paid media on Facebook.

Understanding the Value of a Social Media Impression