Early Results from Facebook Exchange Show 10-20x ROI for TellApart Clients
As one of the earliest companies on the Facebook Exchange (FBX), we’ve been serving ads through FBX for three months and have learned an immense amount about how to maximize performance from this new platform. We can say without reservation that it delivers strong ROI for our clients.
Facebook ads work. Hugely so, as every one of our clients on the exchange has seen a 10-20x return on investment. eBags, one of our earliest marketers to go live on FBX, sees an unwavering 15x return on ad spend. And when we say the Facebook Exchange works, understand that this is based on solid direct response data.
TellApart has the unique business model of only making money when our clients do. We get paid (a share of the sale) only when a shopper first clicks on one of our ads and then converts on our retail client’s site. There may be differences in opinion as to the worthiness of the click as the end-all metric, but there is no debating the direct response value of a shopper who clicks and purchases. Indeed, Google has built $40B of annual revenue around this core behavior.
What makes FBX a game changer for the display ads industry?
1) Huge, Consistent Audience & Environment
First, it’s important that Facebook has a lot of users who come back often and spend a lot of time there. According to ComScore, Facebook serves over 25% of all US display ad impressions, and we’ve seen that proven to be accurate. But unlike other exchanges, FBX offers a stable audience and consistent context. To know that the ads we purchase are going to appear in a clean, well-lit environment with high visibility (i.e. rarely below the fold or not in view) — is invaluable when doing the type of modeling that we do to determine predicted click through and conversion rates.
2) BYOD & Import Intent — Per User
With FBX, Facebook has enabled marketers to import their own customer & intent data, while still protecting user privacy. Facebook doesn’t share any new data with us as a result of these ads, but we’re able to remarket to people the products they’ve seen elsewhere. As with other ad exchanges, Facebook allows each marketer to “Bring Your Own Data.”. If a shopper has shown strong interest in a particular pair of Jimmy Choos on Nordstrom, we can show precisely that user exactly that pair of shoes. Both ad creative and bid pricing decisions are made at the level of the individual user, in real time.
3) Highly Engaged Users
Users shown ads on Facebook via FBX click through at similar — or better — rates as all other ad exchanges. TellApart FBX ads for OnlineShoes.com yield a consistent user click through rate of over 15%. That 15 out of 100 users to whom we served ads on Facebook would choose to click through is an amazing fact. Our all customer average user CTR is 6.6% on both the Facebook Exchange and Doubleclick Ad Exchange.
4) High Return on Investment
As great as clicks are, TellApart’s efforts are worthless until the shopper actually makes a purchase. And those from FBX do. The shoppers who come from the Facebook Exchange clicks are of high quality, with order values that are equally as high as our merchants’ average.
5) Fully Complementary
As a buyer across all of the major real time biddable ad exchanges, even we have seen that FBX increases our unique reach by 30%. The significance of this number should not be understated. With FBX, Facebook has introduced a new form of advertising media that is complementary to both the other Facebook programs and non-Facebook focused programs that retailers may be running. Because FBX uses marketers’ audience data, not Facebook data & targeting, any overlap is likely to be small.
FBX is a new opportunity that all marketers should seriously consider. It’s not accurately described by either ‘earned media’ or ‘paid media,’ and so we’ve taken to calling it, ‘invested media.’ You’ve worked hard to build your ecommerce site and brand. You’ve spent huge sums on keywords and queries. You’ve invested in creating the audience on your site who is interested in what you have to offer. Now you can take that data asset and leverage it into the world’s newest, game-changing ad marketplace: the Facebook Exchange.