Local Online Advertising Case Study: Facebook Vs. Google Adwords

When I decided to do this local online marketing series I asked my good friend Dennis Yu of BlitzLocal to write a guest post.  Since you people love case studies, I asked for it to be a case study.  He obliged.  Below is a case study on Facebook vs. Google Adwords traffic on a local level.

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For our case study we sent traffic from both Facebook ads and Google Adwords to MyEstateManager.com. Below we’ll compare the data from each source and discuss the unique advantages of Facebook, as compared to Search Engine ad networks.

• Below are graphs of Impressions vs CPM for both Google and Facebook paid traffic over a six day period. Note: Impressions are the vertical axis, and CPM is the horizontal one.
• Google traffic is represented by an “Estate” ad group that contained keywords closely related to estate management.
• Facebook traffic is represented by advertisements that were directed at the demographics we had identified as being the most common customer of MyEstateManager.

• What we found was that Google Adwords has far more competition between advertisers than Facebook Ads. On the low end of Google’s price spectrum for our targeted keywords, we were able to get 7000 impressions in a day at a $1.6CPM. Compare that to Facebook, and we were able to get targeted traffic at equal volume for under $.15CPM – that’s less than 1/10^th the CPM on Google! +1 Facebook
• The bounce rates between the networks varied a bit as well. Google Adwords maintained a bounce rate of 48.38%, while Facebook’s was 41.54%. +1 Facebook
• Elasticity of both curves is important to note as well. Facebook’s curve is exponential, while Google’s is basically linear.
• Key Factors: One reason for that is the difference between network ad space and placement. Google has 10 ad placements on the first page, while Facebook advertisements only have the chance to appear in about 3 different spots. You can steadily bid up on Google to increase your ad position, while all the inventory on Facebook is divided amongst a few placements—if you aren’t showing up in these, you aren’t showing up at all. Another factor is competition; Facebook doesn’t have nearly as many publishers competing for the ad space, so a small change in Facebook CPM will make a greater difference than the same change in Google CPM.

Facebook Targeting as an Alternative to Search Engine Targeting

• There is other value in expanding advertising campaigns to Facebook that separates it from other Search Engine ad networks. In Facebook, users self-identify (gender, age, vocation, interests, etc) and can be targeted by who they are. Search Engines, such as Google restrict you to primarily targeting keywords, which means you target people based off of what they are looking for. That can lead to some difficulties depending on what your strategy is; for example, if you are a company that does primarily B2B marketing you may have keywords that show up in both B2B oriented searches and in consumer searches—take the keyword ‘cell phone cases,’ for example, a business that makes cell phone cases that are sold through other stores (Best Buy, Radio Shack, etc) wants to get business from people who will buy from them in bulk. They’re not interested in Joe Teenager who wants a shiny new case for his iPhone. On Google, it’s difficult to to screen out Joe Teenager and get John Executive Purchaser. On Facebook, because of the self-identification data, it may be a bit easier.
• Target your viewers effectively: Below are several targeting tips to apply to your Facebook campaigns.
  • Separate your ads to target males and females separately: men and women will almost always click at different patterns.
  • Tighten your age groups: instead of targeting all males or all females, narrow it down to 4 or 5 years apart max. Different ages require varying ad copy as well.
  • Make your users feel like your product is up to date. A good way of doing this is mentioning the month in your ad copy, or even related current events.

  

The main difference between these two ads is the picture, but that makes a significant difference. The ad on the left maintained a CTR of 0.08% vs 0.03% for the one on the right. Lesson: Users are more likely to click on an image that includes a person’s face.

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