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Social Direct Response: Knowing your ROI from your elbow

By 23 November, 2012
  • Thinking

Do you remember believing in the tooth fairy?  What about Father Christmas? Perhaps at some point you even thought that babies were delivered by storks.  If I’m honest I don’t actually remember believing any of those things.  However, in each case, what I do remember is the moment when I realised those things weren’t true for me anymore.  Now, those moments are far more significant to me as they opened up a whole new world of possibilities.

In particular I remember the embarrassment of being laughed at by some kids in the playground just after announcing to them that I did indeed know where babies came from. “No you don’t” they giggled.  Of course, it turned out they were right and I was very grateful for being educated in such matters.

Some might say that my mother has a lot to answer for, but I’m not one of them.  She was only doing the right thing by ensuring that I got the most out of my younger years by concentrating on the things that mattered at the time.  I.e. Being happy and staying away from things that I wasn’t quite ready for.  Good for her.

Well, the kids in the playground are making some noise again except this time it’s the forward thinking Social Media Marketers that are laughing all the way to the bank.  Yes that’s right, the people that used to be all about playing around on Facebook and touting fluffy engagement figures.  Yes, the same people that didn’t know their ROI from their elbow.  My my, how times have changed.

Facebook have been very busy of late realising their long term goals.  First off they built a great platform.  Then they targeted the middle of the funnel by getting us all to engage with them. Next came amplification as they took our branding pounds and dollars and enabled us to push our message out to a wide audience.

Finally the final piece of the puzzle is being put into place as they begin aggressively taking on Google in the bottom of our funnel.  Facebook is finally allowing us to pull in our engaged prospects and sell to them.  Oh my word did I dare to blaspheme?  Did I actually say the word sell?  Absolutely, and the great thing is that, contrary to popular belief, people on Facebook do want to be sold to.  In fact they’re beginning to buy in droves!

Here’s a quick low down on just some of new tools that have been launched recently.

Conversion tracking / Optimised CPM

On 16th November Facebook finally launched conversion tracking.  Most significantly this is available within the Power Editor and Facebook’s self-service tool.  In a similar way to Google’s conversion tag it allows you to generate a bit of code that can be placed on the thank you pages of your website.  The conversions will then be tracked and ROI can finally be measured within Facebook’s ad manager.

To add to this Optimised CPM (launching out of beta at the end of this month) will adjust the bids to optimise to conversion.  OK, now we’re talking now we’re talking! During beta testing retailer saw the cost per acquisition drop by 39%.


View tags – To be launched at the end of November 2012

Facebook have been quietly testing “view tags” for around a year now and they are slowly but surely being rolled out to more ad partners.  These tags allow advertisers to drop a cookie when an ad is seen.  This is then reported back to the ad manager of choice.  Only certain preferred partners have also been allowed to use this technique after having been given the once over for the tightness of their security.  This is due to the way in which the tag uses the user ID to track the views.

Some initial results have been very interesting.  In an offer for a consumer packaged goods company it was found that of the 5,924 people who redeemed the offer, 5,127 had viewed the Facebook ad compared to just 797 people who clicked directly through from the ad.

In another test by Kenshoo, View Tags revealed that 34.6% of conversion were coming from impressions were the user didn’t click on an ad. That’s not quite social direct response, and it does imply that at a minimum Google Search is involved in the path to purchase, but it’s not far of it. Not far of it at all.

Facebook – Offers

Offers are another of the success stories of the new direct response ad formats.  The way it works is that pages with more than 400 likes can make an offer and post it to their timeline. Facebook users click on the offer and an email is sent to them with the details of how to redeem it.  At the same time this happens a story is created in their friends’ newsfeed giving the offer a true viral element i.e. endorsement by a friend.  The offer can also be further promoted using other Facebook ad options.

This really is one of the social direct response success stories.  David Fischer, Facebook’s vice president of marketing and business partnerships, has announced that within the 100 most popular offers 3/4 of the claims came from those that had not been targeted initially.


Facebook – Custom audience targeting

Does your company have a list of email addresses of customers?  Have you lost touch with some of them?  Chances are that they’re on Facebook, so why not take advantage of the option to target those people directly on the platform of their choice.

The way it works is that an encoded file is uploaded to the Facebook platform.  The matching is done and a list of possible prospects created.  These people can then be targeted with direct response promotions. You are only charged for the people that you contact.

Facebook – Remarketing

Remarketing is one of the Direct Response marketer’s most reliable weapons and now it is possible to use remarketing tactics within Facebook as a part of your overall strategy. Fantastic.

In summary

I’ll be blogging regularly on further updates from Facebook and looking at the other social media channels as they up the ante in the direct response arena, so lock in those RSS or email updates by clicking the link at the top of this page.  By the way, if you’re an email or CRM specialist you’ll be pleased to hear that your core skills and knowledge can be transferred into this area to great effect.  The same is true for PPC experts and if you’ve ever done direct response TV you’ll really want to be watching this space.
So what are your thoughts?  Do you agree that social media isn’t just about the conversation anymore?  Can we actually sell within the social channel?

James Lawson, Consultant