The Facebook Marketplace provides advertisers with the unique opportunities to target consumers based off precise self-selected interests and affiliations. Anything a consumer shares on Facebook is targetable – whether it’s a fan page they like, an interest they have listed or a status message they have written.

1. Havas Digital
Insight
effective
FACEBOOK
MARKETPLACE
advertising
April 2012

2. Havas Digital Insight Effective Facebook Marketplace Advertising
Lead Contributors
Justin Fontana
Search Marketing Supervisor
Media Contacts
justin.fontana@us.mediacontacts.com
Rob Griffin
EVP, Global Director Product Development
Havas Digital
rob.griffin@havasdigital.com
Mark Egan
EVP, Global Director New Business
Havas Digital
mark.egan@havasdigital.com
© 2012 Havas Digital 1

3. Havas Digital Insight Effective Facebook Marketplace Advertising
Contents
1. Identifying your target. ........................................................ 3
2. Methods of discovery........................................................... 4
3. Creative. ...................................................................................... 9
4. Bid strategy. ........................................................................... 11
5. Reporting................................................................................. 11
6. Optimizing. ............................................................................. 12
Summary. ...................................................................................... 14
Contact details........................................................................... 15
© 2012 Havas Digital 2

4. Havas Digital Insight Effective Facebook Marketplace Advertising
1. Identifying your target
The Facebook Marketplace provides advertisers with the unique opportunities
to target consumers based off precise self-selected interests and affiliations. Any-
thing a consumer shares on Facebook is targetable – whether it’s a fan page they
like, an interest they have listed or a status message they have written. It’s an
absolute goldmine in terms of reaching the right consumer; no other platform
comes close to being this niche.
There are many different components that come into play that will ultimately de-
termine how effective your campaign performance is, the main driver being your
target audience. Certain targets will show a higher propensity to convert; even
two targets that seem to be extremely similar can differ drastically. Size, daily
growth and target growth organically or through paid media are also important
factors to consider.
Facebook gives you three options for targeting – precise, broad and category:
• Precise Targeting gives the advertiser the ability to cherry pick individual tar-
gets. For example “Pepsi” will only target people who like the fan page “Pep-
si”. Precise is very beneficial when you know exactly what you want to target.
In this scenario, it would exclude a fan page named “Pepsi US” and any other
variations of Pepsi fan pages.
• Broad Match, which is enabled by inserting a hash tag in front of a keyword,
will target anything FB deems relevant to that keyword. Broad match is effec-
tive when you can’t find every individual precise interest. For instance, there
are hundreds of wineries on Facebook, but finding every single one of them is
a challenge. Targeting #winery should capture the majority of them. Unfortu-
nately, Facebook does not give much transparency in regards to what you are
actually targeting. They merely give you a target size, which is the best way to
verify if you’re targeting what you intended to target.
• Category Targeting segments Facebook users into certain categories based
off of interests and actions a user has taken. It’s a simpler way to reach an en-
tire demographic without building out an extensive list of interests. Categories
typically have a large reach, but lack in transparency. One main benefit of cat-
egorical targeting is reaching consumers that are difficult to find via interests.
For instance it’s hard to deduce whether someone is a parent or not based off
the interest they choose. With category targeting, you can specifically choose
“parents” and combine that with precise targeting.
© 2012 Havas Digital 3

5. Havas Digital Insight Effective Facebook Marketplace Advertising
PRECISE BROAD CATEGORY
Estimated Reach Estimated Reach Estimated Reach
865,240 people
1,180,120 people
11,032,240 people
• who lived in the US • who lived in the US • who lived in the US
• age 21 and older • age 21 and older • age 21 and older
• who like bacardi • who like #Bacardi • who are in the category
Beer/Wine/Spirits
2. Methods of discovery
Discovering interests can be a time consuming task if one does not know where
to look. The Facebook UI offers very little besides “suggested” keywords and the
little they do offer can often be very irrelevant. In the section below we outline the
different methods of discovery and how effective each method is.
LeaderBoard Sites provide categorized list of thousands of different fan pages
ranked by order of total fans. Your keyword list should start from these sites, as
it’s the easiest place to find precise interests that have a significant reach. Leader
board sites also show daily and weekly growth, indicating whether a page is stag-
nant or increasing its fan base every day. It should be noted that these sites are
not 100% inclusive, they are a great starting point, but not an end all solution. An
advertiser can select the leader board and copy and paste into Excel fairly easily.
Source: pagedata.com
© 2012 Havas Digital 4

6. Havas Digital Insight Effective Facebook Marketplace Advertising
a) Suggested keywords
When an advertiser is in the Facebook UI, they can type an interest in and click
suggested keywords. It is recommended to use multiple interests at first. Often
with only one keyword, the suggested keywords are irrelevant. Most API tools
have the ability to save keyword buckets for future use. When inputting keywords,
a drop down list of ten relevant keywords sorted by reach will also be shown. An
advertiser could select each interest until the drop down list is exhausted. Once
the list is exhausted, merely typing a letter after the word could generate even
more keywords. This method could be time consuming, but it is effective at build-
ing out a large list of keywords.
>> Suggested Keywords
>> Keyword Drop Down List
>> Adding a letter after
the keyword
© 2012 Havas Digital 5

7. Havas Digital Insight Effective Facebook Marketplace Advertising
b) Facebook search
Although the Facebook search bar can deliver spotty results in our own personal
usage, it can be effective tool for keyword discovery. An initial search should
yield up to 10 results and can be expanded by clicking “show more results.” An
advertiser could potentially search on a particular keyword and click “show more
results” several times to build out a potential list of keywords. The steps involved
are easy and displayed below.
>> Step 1: Search
>> Step 2: Click more
results (as many
times as you want)
>> Step 3 (Select All)
>> Step 4: Copy and
paste special
values into excel
© 2012 Havas Digital 6

8. Havas Digital Insight Effective Facebook Marketplace Advertising
>> Step 5: Sort and filter out rows
that are not name of pages
Tip – Sort first to remove addresses (numbers
will typically not be in the name of a fan page)
then filter out cells that include the word “like”
or have a backslash. This will typically leave you
with a list that is mostly just pages.
c) Observing active ads
Targeting active advertisers is an effective way to reach fan pages that are actively
growing as well as reaching consumers that have previously engaged with Face-
book ads. An advertiser should create a fake profile that “likes” particular inter-
ests and fan pages to see who is advertising in particular categories.
d) Targeting via administration access
Targeting an entire fan base of any target is impossible without administration ac-
cess to that fan page. This rule was developed to prevent an advertiser like Pepsi
from targeting all Coco-Cola fans. Targeting off admin connections VS interest/
likes tends to perform substantially better because of this. Administration tar-
geting becomes extremely important when managing advertising campaigns for
multiple campaigns for the same client.
© 2012 Havas Digital 7

9. Havas Digital Insight Effective Facebook Marketplace Advertising
e) Target types
Although not specified in Facebook itself, you will encounter three types of key-
words during the discovery phase: Literal, Competitive and Inferred. All three are
beneficial to your campaign.
• Literal keywords include words that are directly related to your product. “I
love wine” would be a literal keyword for a wine brand. Typically this type of fan
page is produced by a consumer as opposed to a brand. Fan pages that are
developed by consumers are occasionally old fan pages and possibly stagnant
in growth. Literal keywords tend to perform well but in short bursts because of
the stagnant growth.
• Competitive keywords are brands that you would consider competition. Be-
cause these fan pages are typically created by brands themselves, they tend
to be large and active. It’s very important to include competitors in your mix,
because of the reach and relevancy to your brand. One downfall to competitive
ads is dealing with brand loyalty; there will always be consumers that refuse to
“like” Coke if they are big Pepsi fans.
• Inferred keywords suggest that a consumer may be interested in your product.
For instance, a consumer that likes to eat cheese may be interested in wine. In-
ferred keywords can include both brands and literal interests. Much like compet-
itive, reach could be very high, but because the keywords are not always directly
relevant, performance may not be on par with the other two target types.
f) Compound targeting
Most API tools have the ability to segment ads into demographic buckets. These
buckets include Location, Age, Gender, Interest/Likes, Relationship Status, Sexu-
al Orientation, Languages and Education. With this in mind, it is easy to imagine
ads segmented into hundreds of different buckets and this does not yet take
creative into consideration. Facebook imposes a 10,000 ad limit to prevent ad-
vertisers from overloading the servers, therefore compound targeting becomes
difficult to use across the board. When choosing what to segment by, common
sense usually prevails. For instance, unless you believe a married man would per-
form better than a man that is single, breaking out the two may not necessarily
make sense. Compound targeting is very effective in situations where you want
to target one large fan page, but want to reduce the size of the fan page into
smaller buckets because the large reach may be negatively impacting the per-
formance of the ad. It is a great mechanism for testing but much like ad segment-
ing in display and search; just because you can do it, does not necessarily mean
you need to do it.
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10. Havas Digital Insight Effective Facebook Marketplace Advertising
g) Grouping vs. singular targeting
Often advertisers, especially ones that do not have an API access, will group sev-
eral targets together in one particular ad. This method is recommended when go-
ing after targets that have a small reach (less than 20,000). Some API tools have
the ability to segment by interests and likes, where one could list 200 different fan
pages and create an individual ad for each target. If you are using a leader board
site for keyword discovery, chances are the fan pages you are going after are large.
In this scenario, it makes complete sense to create individual ads for each one. It is
important to note that each ad is an individual optimization point, if you are includ-
ing 100 different targets in a particular ad, you can only use one bid for that target.
If you are targeting the top 100 CPG brands on Facebook, one page may be driv-
ing up cost while another one is driving down cost. Some API tools have transpar-
ency into performance by segment in an individual ad, but ultimately you are not
doing your campaign justice by having the same bid for all segments.
3. Creative
Facebook offers 4 different types of Facebook ads. Two of the ads are primarily
used for fan acquisition; the other two are for fan page engagement.
a) Fan acquisition
Standard Ads include a 110x80 image with 90 character of ad copy. This is the
most common ad type you will see on Facebook. It’s important to have an image
that stands out or one that consumers can quickly identify. Including an incentive
for liking the page tends to perform well, but by no means is it necessary.
Sponsored Story: “Page Like Stories” are social endorsement ads. Creation of
these ads is automatic, there is no image and no copy is included. “Page like
Stories” includes an image of a friend that likes the fan page as well as the main
image used for the fan page. In certain cases, because the image is resized au-
tomatically, the image may look warped or unrecognizable. In this scenario, your
© 2012 Havas Digital 9

11. Havas Digital Insight Effective Facebook Marketplace Advertising
best bet is to work with the manager of the fan page, to redevelop the main im-
age. “Page like stories” can be used in conjunction with your regular targeting,
but will always include friends of fans. If you running a “like” campaign, every
target you normally use for standard ads should also be used for page like stories,
as performance is typically better on these ads.
b) Page engagement
Page Post Ads distributes status message via ad units to consumers. These ad
units are meant to increase engagement with a particular status message. In terms
of fan acquisition, they tend to underperform because you cannot like the page
directly with the ad itself. There are four actions a consumer can take in these par-
ticular ads, “like”, comment, share and click through. These ads are particularly
helpful during promotions. For instance a consumer could click through to a cou-
pon page or enter a sweepstakes directly from this ad unit. If the status message
includes a video, an advertiser can promote the video without paying extra.
Sponsored Story: Page Post Stories are essentially the same as Page Post ads, but
it will show that a particular friend liked the status message. One downfall with these
types of ads is that you cannot pick the status message you want to promote, so it
could potentially promote an outdated status message. The inclusion of a friend’s
endorsement tends to drive higher performance verse standard page post ads.
© 2012 Havas Digital 10

12. Havas Digital Insight Effective Facebook Marketplace Advertising
4. Bid strategy
a) Bid types
Facebook offers three types of bidding. CPC, CPM and Action Optimized CPM.
CPC bidding is recommending for driving efficiency and should be the primary
bid type an advertiser should use. CPM is not recommend in any scenario, as it
merely delivers ads as fast as possible with no algorithm in place to determine
when and where an ad should appear. Action Optimized CPM, which is only of-
fered on select accounts, attempts to deliver ads to people that are most likely
to take an action. A maximum bid is not set on these bid types; therefore closely
monitoring performance is essential. Action optimized CPM could potentially
drive more volume than your typical CPC ad, but ultimately would only be helpful
in a situation where you were not hitting your daily budget. In most cases, CPC
ads are more efficient than action optimized CPM.
b) Bid management
Under a CPC model, Facebook determines whether to deliver your ad based off
of your effective CPM. An effective CPM threshold is determined by competition.
With this in mind, your CTR and CPC bid will ultimately determine how much you
pay per click and how often your ad is delivered. If your CTR drops and you are
not bidding enough to maintain a competitive CPM, Facebook will slow your de-
livery down or possibly stop the ad all together. In order to maintain an efficient
campaign it is essential to check performance daily. It is quite possible to log
into your account and suddenly see delivery stop completely. It is also possible
to overbid, especially in a situation with a constrained budget. Although the ag-
gregated CPC on a specific ad will rarely be the same as your maximum bid, the
bid still exists as a threshold to prevent the ad from costing more than a specific
CPC. Given the volatile nature of the marketplace and the co-dependency on
CTR, you’ll want to have a CPC bid that you are comfortable with to prevent the
cost from getting to high.
5. Reporting
With the possibility of having thousands of different ads, you’ll want to be able
collect the data and pivot it to your liking. Unfortunately, an ad report by itself
does not include column data for crucial information such as copy, image or tar-
get. If you want this information included in your reports, there is two ways to go
about this: Ad naming and Bulksheets.
© 2012 Havas Digital 11

13. Havas Digital Insight Effective Facebook Marketplace Advertising
a) Via ad names
Properly naming each ad with the criteria you want to report on will enable you to
perform a text-to-columns in excel. For example if an AD is named Image1.Jpg |
Enjoy A Free… | #Mexico, you could separate that cell by the “|” and have 3 col-
umns. Ideally every API tool should have this function, as manually doing this on
thousands of different ads would be overly time consuming.
b) Via bulk sheets
Another method of collecting data is via a bulk sheet export. Bulksheets include
column data for every targetable segment as well as copy. Bulk sheets do not in-
clude the name of the image. This data could be connected to an ad level report
in Facebook because they both include AD IDS. By performing a VLookup of AD
ids from the ad report, you should be able to have data on every level besides
image. In order to have image, you will need to name every ad by the name of
the image. Ultimately you should be able to pivot data into a very granular level,
with this type of reporting you could essentially say “Males aged 25-34 that were
delivered XXX copy with XXX image that are interested in Golf, drove XXX likes at
a cost per like of XXX.
6. Optimizing
Ultimately performance is evaluated by volume and efficiency. Because the reach
on Facebook is so large and advertising is relatively inexpensive, testing is easy
and relatively risk free.
• Re-launch ads
Every ad is an individual unit that acts on its own. Because of this, adding an ad
that is an exact duplication of an existing ad could potentially yield completely
different results. If an ad that historically drove volume suddenly stopped deliv-
ering, it is most likely due to a sudden drop in CTR. An advertiser could dupli-
cate that ad and launch it as if it had never run before. In situations like this, it is
recommended to build a new ad instead of increasing the bid of the previous ad
because the previous ad now has negative historical data.
• Effective CPMs
Effective CPMs are typically between 15 to 50 cents. The lower it is, the less your
ad may deliver. If it is higher than 50 cents, you may be paying higher than you
need to. The marketplace is always subject to change, especially as competition
increases and new ad types are introduced.
© 2012 Havas Digital 12

14. Havas Digital Insight Effective Facebook Marketplace Advertising
• Inline likes
Likes that occur within the ad unit- typically comprise of over 90% of all ‘likes’.
An advertiser does not pay for the like; they pay for a click through to the page.
Typical conversion rates are above 50%, upward to 80% and it is even possible
to see a conversion rate of 100% because a consumer can click “like” and not
the ad. Because conversion rates are relatively high, it is usually safe to assume
a difference of 25 to 50% from CPC to CPL.
• Brand Affinity
Brand Affinity plays a major role in performance. A well known brand should
perform better than an unknown brand. A recent study by Webtrends indicates
that certain types of products perform substantially better than others. Below is
a chart that shows average CTRs and CPCs by industry. This data was collected
late in 2010; therefore the average cost may have fluctuated since then.
© 2012 Havas Digital 13

15. Havas Digital Insight Effective Facebook Marketplace Advertising
Summary
Facebook is the new frontier of digital advertising. Never before has an adver-
tiser been able to tap into a vast database of information that included human
behaviors at such an extraordinarily granular level. The benefits to an advertiser
are unparalleled and because of this it has become a medium to monetize.
The competition has been growing and is evident with the influx of new API part-
ners. Everyone believes they have the best technology in market and although
technology is important, proper education is even more important. Without
knowing the ins and outs of the marketplace such as keyword discovery, crea-
tive development, optimization and reporting it is impossible to make educated
decisions. There is a lot of fluff in the market right now. Companies are trying to
monetize the medium and this often involves misleading information. Ambigu-
ous terminology and grand claims are often developed by sales professionals to
lure you into buying a managed service at a huge margin.
The Facebook Marketplace is not rocket science, mastering it is a combination of
common sense and practice. Equip yourself with knowledge and seize the day!
There is a lot of fluff in the market
right now. Companies are trying to
monetize the medium and this often
involves misleading information.
© 2012 Havas Digital 14

16. Havas Digital Insight Effective Facebook Marketplace Advertising
Contact details
We encourage you to contact us directly to discuss, in more details, any concerns
you may have regarding this Havas Digital Insight issue.
We will be happy to assist you.
· justin.fontana@us.mediacontacts.com
· rob.griffin@havasdigital.com
· mark.egan@havasdigital.com
Or contact your Havas Digital LOCAL OFFICE:
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18. Havas Digital Insight Effective Facebook Marketplace Advertising
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