How an Online Facebook Offer Targeted at Fans Resulted in 9.5X ROI

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facebook offer fans vs nonfans sales How an Online Facebook Offer Targeted at Fans Resulted in 9.5X ROI

I didn’t plan on participating in Cyber Monday. But ever since I wrote about the hidden way to create online Facebook Offers for e-commerce sites, I’ve been itching to give it a run.

And boy am I glad I did!

I didn’t start my campaign until 10:22am on December 2, which was Cyber Monday. That campaign ran until midnight on the morning of December 3, so it didn’t even last a full 14 hours.

Lack of preparation. Very short window. A confusing landing page. And yet, this online Facebook Offer resulted in nearly $2,000 of direct revenue.

I’ve documented some incredible ROI results related to Facebook ads before. But this campaign was an interesting experiment due to the short run-time and the fact that it utilized a Facebook Offer.

Some of the results weren’t shocking. When I targeted Fans and email subscribers, I received a far greater ROI than when I targeted non-Fans.

Other results nearly knocked me off my seat. I spent $200 to reach fewer than 10,000 Fans and email subscribers. And while that seemed crazy, the results made it worthwhile.

Let’s break down exactly what I did here before we start to pick apart the results.

The Campaign

I created an online Offer within Power Editor using unpublished posts. The product being promoted was my Power Editor training course.

Here is what it looked like:

cyber monday facebook offer 700x366 How an Online Facebook Offer Targeted at Fans Resulted in 9.5X ROI

Note that I was very careful about the amount of text since I didn’t want this campaign to be delayed by the 20% text rule.

The redemption link went to a checkout page with the discounted price of $73.50 (half off of the regular $147 price).

This wasn’t ideal since anyone unfamiliar with the product was pushed straight to buying without learning more about the course. It was a bit sloppy, but since it was done last minute I had little choice.

Also, this made analysis much more clean-cut. Since I didn’t promote this special deal anywhere else, you could only access it via the Offer. So the only way someone could redeem it was if they or a friend (the friend then sending the link to the purchaser) claimed the Offer.

I created two separate campaigns:

  • Targeted at Fans and Email Subscribers
  • Targeted at Relevant Non-Fans

For the first campaign, I simply created a separate ad for each target audience (one for Fans and one for email subscribers). When I targeted email subscribers, I excluded those who were already Fans.

For the second campaign, I created five different ads targeted at variations and combinations of people who liked similar Pages and interests and those on my Lookalike Audience lists:

  1. Non-Fans who Like similar Pages and Interests
  2. Non-Fans part of my Lookalike Similarity list
  3. Non-Fans part of my Lookalike Reach list
  4. Non-Fans part of my Lookalike Similarity list who like similar Pages and Interests
  5. Non-Fans part of my Lookalike Reach list who like similar Pages and Interests

In each campaign, I excluded anyone who had already purchased my training course.

As mentioned earlier, I didn’t start the campaign until 10:22am my time on Cyber Monday (December 2). The Offer expired at Midnight, so it ran for under 14 hours.

However, anyone who claimed the Offer had an extra day to redeem it. I did this for a couple of reasons. First, I didn’t want to shut out someone who claimed it right at about midnight. Second, I wanted to make use of the reminder Facebook sends (I had it go out the following morning at 10:00am).

This ended up being the right decision since eight redemptions came in on the second day.

I started out with a $100 total budget, $70 for the Fans and Email Subscribers campaign and $30 for the non-Fans. As sales started coming in for the first campaign, I repeatedly increased the Fans and Email Subscribers budget.

In the end, I spent a grand total of $230 on this day. Of that, $200 was spent on my Fans and Email Subscribers campaign.

The Results: Fans Only

facebook offers fans spend claims sales How an Online Facebook Offer Targeted at Fans Resulted in 9.5X ROI

I spent a total of $194.34 to reach 8,924 of a potential 14,000 Fans. I reached each Fan an average of 14.94 times (most in the sidebar) for an overall CPM of $1.46.

It’s important to note how much this CPM increased, however, as I started increasing my budget while running out of time. I was essentially forcing Facebook to show my Offer to as many Fans as possible. This resulted in CPM as follows:

  • Right Column on Home Page: $0.52
  • Right Column on Desktop: $0.73
  • Mobile: $10.85
  • News Feed on Desktop: $19.98

CPM was much higher than normal. First, this was due to the high budget and short period of time. Second, you can bet I had far more competition for ad space because it was Cyber Monday.

The funny part is that I had stopped my ads on mobile because the CPM was so high. But the result was that Desktop News Feed CPM skyrocketed. My assumption is that this would have happened (probably to an even greater extent) on mobile if I had kept the Offer running in that placement.

So… How about those results?

  • 107 Offer Claims
  • 25 Sales ($1,837.50 Revenue)

You’ll recall that my spend on Fans was $194.34, so this results in a 9.5X ROI when targeting Fans only.

Let’s go ahead and break this down by placement…

Right Column on Home Page:

  • Spend: $31.17
  • Offer Claims: 26
  • Reach: 7,079
  • Frequency: 8.50
  • Sales: 8
  • Cost Per Sale: $3.90
  • Revenue: $588.00
  • ROI: 18.9X ROI

Right Column on Desktop:

  • Spend: $49.02
  • Offer Claims: 24
  • Reach: 6,328
  • Frequency: 10.56
  • Sales: 2
  • Cost Per Sale: $24.51
  • Revenue: $147.00
  • ROI: 6.0X ROI

Mobile:

  • Spend: $14.47
  • Offer Claims: 15
  • Reach: 1,272
  • Frequency: 1.05
  • Sales: 3
  • Cost Per Sale: $4.82
  • Revenue: $220.50
  • ROI: 15.2X ROI

News Feed on Desktop:

  • Spend: $99.67
  • Offer Claims: 42
  • Reach: 4,742
  • Frequency: 1.05
  • Sales: 12
  • Cost Per Sale: $8.31
  • Revenue: $882.00
  • ROI: 8.8X ROI

On the surface, it would seem I spent too much on Desktop News Feed, but the truth is that the Cost Per Sale only went up due to the increased budget and short time period. If I had kept my budget lower or focused on sidebar, I undoubtedly would have ended with a better Cost Per Sale and ROI, but the total number of sales would have been far less.

It’s obviously evident that it would be nice to target Right Column on Home Page Only when focusing on the sidebar. Well, this feature is coming. In fact, I saw it temporarily on my Power Editor before it disappeared.

The Results: Email Subscribers

facebook offers subscribers spend claims sales How an Online Facebook Offer Targeted at Fans Resulted in 9.5X ROI

Within that first campaign, I also created an ad targeted at a Custom Audience. This audience focused on non-Fans who are also on my email list. The result was a potential audience of only 1,640 people.

Since the audience was so small, this ad didn’t get much activity. It did, however, generate a sale from minimal spend.

I won’t break this down by placement given the small sample size. So here are the overall numbers for the ad that targeted email subscribers:

  • Spend: $5.66
  • Offer Claims: 2
  • Reach: 507
  • Frequency: 7.30
  • Sales: 1
  • Cost Per Sale: $5.66
  • Revenue: $73.50
  • ROI: 7.7X ROI

Certainly successful, but not scalable given the small audience I had to work with.

The Results: Non-Fans

facebook offers nonfans spend claims sales How an Online Facebook Offer Targeted at Fans Resulted in 9.5X ROI

A few months back, I documented how I got a 35X ROI when promoting this same product with Facebook ads, though I didn’t get a single sale from non-Fans (who weren’t on my email list or targeted via FBX, at least). That was again the case this time when using Facebook Offers.

Here are those non-Fan numbers broken down:

  • Spend: $30.00
  • Offer Claims: 46
  • Reach: 67,417
  • Frequency: 2.51
  • Sales: 0
  • Cost Per Sale: N/A
  • Revenue: $0.00
  • ROI: N/A

Crazy, right? My Cost Per Offer Claim for Fans and email subscribers was $1.83 compared to $0.65 for non-Fans. Yet, not a single sale came from those non-Fan Offer claims.

An important component here that didn’t help my conversion rate with non-Fans is that the redemption link went straight to a checkout page instead of a landing page that would have described the course in more detail.

Still, the lack of sales activity from non-Fans is consistent with what I’ve been seeing in other campaigns. More evidence that you need to build up your relevant Fan base and focus your sales there.

Final Analysis

Am I surprised that Fans and email subscribers far outperformed non-Fans? Not at all. I’ve seen this repeatedly, and it’s why I urge you to build a Facebook sales funnel focusing on relevant Fans who will buy from you.

But I was pleasantly surprised by the results in such of a short, spur-of-the-moment campaign. And I’m always skeptical whether Offer claims will result in sales.

In this case, I’m finding that relevance and loyalty are key factors in converting an Offer claim into a redemption. While the non-Fans didn’t redeem any of their 46 claims, more than 24% of Fans and email subscribers who claimed followed through with the purchase.

Of course, these are the numbers of one Page selling one product. What kinds of results are you seeing from Facebook Offers?

Let me know in the comments below!

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About Jon Loomer

Jon Loomer is a digital marketing consultant with a unique perspective on social media. He was introduced to Facebook in 2007 while with the NBA (back before Pages) and has been using Facebook for business ever since. Stay in touch by liking his Facebook Page (Jon Loomer Digital).

  • Adam Landry

    Jon – I have a hard time getting my image to use the maximum allotted real estate. What’s the trick? I noticed how big and wide the image you used was for the cyber monday run. Any advice would be greatly appreciated.

  • http://johnhaydon.com/ John Haydon

    Nice work, Jon! It looks like people in your community are way more likely to buy than people who aren’t, supporting the idea that fan engagement and email acquisition are critical steps along the journey to converting customers.

    • http://jonloomer.com/blog Jon Loomer

      Indeed!

  • Sarah Pinnix

    Fascinating analysis. I’m intrigued by your statement that CPM would go down if you lower your budget, and that it went up because your budget was high. I’ve been doing basically 2 campaigns like you – one for fans and supporters, one for similar interests/lookalike non-fans. We are getting a pretty good ctr for the similar interests, but our CPM and CPC is very high, so ROI is not that great. So, should I conclude from your analysis that if I created several campaigns for different audiences, each at a lower budget, the CPM would go down?

    • http://jonloomer.com/blog Jon Loomer

      Hey, Sarah! So, oCPM is going to depend on the competition. Two big factors here will be the size of your audience and the length of time you are giving Facebook to reach them. If I set a $10 budget to reach a potential audience of 100,000 people during a one week period, Facebook will have no problem finding those people to reach at a lower amount. But if I set a $500 budget and tell Facebook I want to reach only this group of 10,000 people in a 12 hour period, Facebook is going to do what they can to reach those people. But in order to do that, I’ll need to beat out advertisers to get most of those eyeballs. So bids have to keep going up to reach as many people as possible within that very small window of time.

      So my $200 budget may have resulted in a lower CPM had I simply been targeting a larger group of people or if I allowed Facebook a week to reach those people instead of under 14 hours.

      Make sense?

      • Sarah Pinnix

        Yes, totally. Thanks so much for always taking time to explain. :)

  • Michael

    Right Column on Homepage are ads that are only shown on the Newsfeed on the RHS and Right Column on Desktop can be shown everywhere (events, photos, etc.) – is that right?

    Also: I had a lot of success with offer claims and usual link ads – but again als with FANS ONLY. Non Fans really don’t seem to convert that well…

    • http://jonloomer.com/blog Jon Loomer

      Correct regarding Right Hand Column ads, Michael.

      What you are seeing is exactly what I’m seeing. Fans convert FAR better. Those who don’t focus on building a highly relevant audience will struggle with driving conversions. Makes building that audience all the more important.

  • Mardy

    Hey Jon,

    Another great article man, nice work You should knw that you are the only blogger talks talk specifically about campaigns that generate ROI with examples. That’s special man. It’s seem facebook marketing Gurus tend to evade the discussion of speaking about dollars and cents directly.. And thats why you’re different.

    I asked this question before, but wasn’t sure if you saw it.

    Do you think facebook advertising would work well to generate patients for a local eye doctor (optometrist)? I’m referring to eye exams only – purchasing designer frames is a separate transaction, typically handled by the optician.

    And on the flip side – do you think facebook advertising could work to generate sales for opticians – sellers of lens and frames (Foreyes for example)

    I ask because trying to target people who need an eye exam or new glasses is difficult because only need new glasses once every 2 years and not something they communicate on faceboook. Btw all I’m looking for is validation that it would worth time investing in. Not a step by step.

    Thanks Jon

    Mardy

    • http://jonloomer.com/blog Jon Loomer

      Thanks, Mardy!

      Really good question. What you’re dealing with is a challenging problem, but not impossible.

      You could always target non-Fans with ads selling product. I have a difficult time selling in those cases, but you could potentially find success.

      Otherwise, your challenge is building an engaged audience who will then buy from you later. It’s doable, but you need to get very creative considering the niche you’re in.

      If you or a staff member are creative people and are good with copy, creating engaging content and finding creative ways to get people excited about your product, you can absolutely find success in selling on Facebook. But without that step, it’s trickier.

      Good luck!

      • Mardy

        This is much appreciated Jon, thank you.

  • heidicohen

    Jon– Thank you for being so transparent. Your case study is useful for a lot of marketers. It shows the power of Facebook advertising. Happy marketing, Heidi Cohen

    • http://jonloomer.com/blog Jon Loomer

      Thanks, Heidi! That’s why I share the stuff.

      • Mardy

        I agree. If your clients will allow it, case studies showing their results I think will be a great boost. Kieth Kranc is the only one I’ve seen that actually talks about specific results with his local market clients. I can’t believe their isn’t more focus with that.

        • Mardy

          I meant more focus on that generally in facebook education market, not specifically this blog.

  • Jack Coburn

    Jon, i’ve only just started studying FB marketing so my ignorance at this point is vast! I’m trying to understand your case study but one thing I don’t get (which I’m sure is necessary to understand it) is – what are Offer Claims as opposed to Sales?

    • Jack Coburn

      Wot No Reply?!?!?!

      • http://jonloomer.com/blog Jon Loomer

        It’s an official ad unit that Facebook has created that allows you to promote an Offer. There is a button on it that allows users to claim, which then shares with friends and sends them an email with additional details. No obligation to buy.

  • John Andrew Markham

    Just came across your work. Totally inspired, making my way through the posts before I take part in the paid programs. I am currently marketing for my landscape company, Banyan Tree Landscape, in Ashland, OR. I’m using it as a platform to educate myself in FB marketing as I have a couple of national start-up businesses in the works….While branding the landscape company. Practice marketing on the small target audience before stepping in to a much larger potential client base.

    I would love to make some form of offer for the landscape company giving 15% discount on Hardscape installation. In this case it seems to redeem the offer would require the button to take you to an email for scheduling an appointment? Is that possible?

    • http://jonloomer.com/blog Jon Loomer

      Hey, John! Sure, you can actually provide a redemption code along with a link to schedule your appointment. I’m thinking that would likely be the best way, minus having a direct link that automatically applied the discount.

  • Marco Flaborea

    I discovered just some days ago your blog and now I’m waiting every day for some new insight… Some things you shared are already helping with my job :) Keep up the good work!!! Marco

    • http://jonloomer.com/blog Jon Loomer

      Awesome! Thanks, Marco!

  • http://corp.wishpond.com/ James@Wishpond

    Jon, interesting article, as usual. I think you were spot on with the importance of a landing page when targeting non-fans. To me, the non-fans claiming offers but not converting sounds about right. You’re targeting a lookalike audience, who are (by definition) interested in the subject matter of your ad (earning you a click-through), but need that extra little nurturing which your landing page would give them before they’ll convert.

    Wishpond does online promotions for lead generation, so a lot of the ads we run for clients (or they run themselves) are for offers. I think they’re hugely important on Facebook. I’m sure you’ve mentioned the importance of a value proposition in advertising – offers are one of the most effective value propositions out there.

    Somewhat off topic, did you hear today that Twitter’s integrating an ad conversion tracking pixel? Only mention it as you were my go-to-guy when learning about conversion tracking a couple months ago. Cheers!

  • Brandon Holcomb

    Basically what you are doing is re-marketing if you are using your email list.

  • Teagan

    Hi Jon,
    I know this is an old post but I was looking for a relevent place to ask this question!
    I have recently done some advertising for my current fans (just under 1000). Over a week, it onl;y reached 425 fans. Does this mean that the fans I do have aren’t on Facebook very often? That they are not seeing much (if any) posts that I am putting up (paid and not paid)? Anything else this could mean? How can I rectify this?
    Thanks
    Teagan

    • http://jonloomer.com/blog Jon Loomer

      It could mean any number of things, Teagan. If you are using a fixed bid, maybe it’s not high enough. If you’re using Optimized CPM, Facebook shows it to those most likely to perform your desired action.

  • Jakub Zachnik

    That’s really comprehensive case study you did there. It was really useful for me when analyzing some of the Facebook Offers mechanics and the way it works in real situations. Most of all, the transparency in the data came in handy. Thanks a lot.

    I’m wondering what would be the outcome of the offer for ‘non-fans’ if it would be a direct recommendation from one of your actual subscribers. Did you even notice if any of your fans who claimed the offer shared it?

    If you feel like it, I would be more than happy to show you the comparison between Facebook Offers and Realdeal Launcher (our startup solution to distribute offers in social media) on our blog.

    Cheers!
    Kuba

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