You may have heard that doing Facebook ads can be a very effective way of getting more customers for your business and boosting your revenue. In this article, we walk through some factors to consider when creating a Facebook ads strategy for a local business.
What is the Lifetime Value of Your Average Customer?
Knowing the lifetime value (LTV) of your customers is important for determining how much you may need to spend on Facebook ads. Here are some questions to help you determine the LTV.
1. What is the average sales price of your products or services?
2. How much, on average, does someone spend each visit?
3. How many visits do they come total, on average?
There are various formulas for calculating the lifetime value of a customer. One of the more common formulas is:
CLV = Average Sale x Number of Repeat Sales x Expected Retention Time x Profit Margin
How Much More Business Do You Want?
Another important question to ask is what are your business goals and how much more business can you handle or want, per day, week, or month. What are your busiest days and times and least busy days and times? Do you want to grow and open more locations or have more free time for yourself? Facebook advertising can help you to meet these goals.
How Many Leads Could You Convert to Sales?
What percent of leads would you be able to convert to paying customers? The answer to this question can help you to understand your estimated profit from leads. Also, the faster you follow up with leads, the more likely they are to convert to customers.
How Far Would Leads Drive to Get to Your Location?
Knowing the distance that leads would be willing to drive to get to your location of business helps in properly setting up Facebook ads. For example, if we know that people are willing to drive up to about 17 minutes (approx. 11.3 miles) to get to a restaurant, we can set up the Facebook ads to target a radius of 11.3 miles driving distance around the location of the restaurant.
What Are Your Customer Personas?
There are many ways to create and target audiences in Facebook. Some of these include targeting by age, location, gender, interests, language, and behaviors. We choose the best targeting for you based on your audiences and the type of campaign we are doing. Knowing your customer personas is important for targeting purposes when creating a Facebook ads strategy for a local business. For example, a persona might be women ages 25-35 who are interested in fitness.
What Special Offers Can You Give to Your Target Audience?
Consider what type of offers you can make to attract new customers. Usually, to get new customers through your doors, a one-time offer or voucher is created for a Facebook ad campaign. An example is a dentist offering free teeth whitening, or a restaurant offering free dessert for people with upcoming birthdays. We can also create incentives for people to return to your location. After three visits, people are likely to become long-term customers.
When thinking about your Facebook ads strategy for a local business, it’s important to consider each of the above factors carefully. After all, they can give your business the boost it needs to succeed both online and offline.
Interested in upping your search presence? Contact us today and our team of experts will lend a helping hand!