

We Spent $1,138 on Facebook in 6 Days: Numbers and Lessons Learned - shanecox1
https://signnow.com/blog/2011/06/23/we-spent-1138-on-facebook-in-6-days-numbers-and-lessons-learned/
We just completed our first Facebook advertising campaign, corresponding with our trip to TechCrunch’s Disrupt conference. Startups test theories, so we treated this first attempt as an experiment. Here is what we did and our results.
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Silhouette
Am I missing something here?

The author seems pleased with the results, but as an outsider who isn't
familiar with his company I see an ad campaign that cost over $1,000, achieved
clickthroughs well under 0.1% despite targeting, and does not appear to have
resulted in any measurable benefit at all. There are some comments at the end
of the article about how Facebook is great for brand awareness, but there
doesn't seem to be much evidence of that in the numbers.

If I were looking at ways to spend advertising budget for a new company (oh,
wait, I _am_ looking for...) then this seems like a pretty compelling argument
for not wasting money on Facebook ads.

~~~
aisalwaysa
I can really see it going either way. I interpret this to show Facebook Ads
are not a good way to get instant ROI. But there is a lot of value in having a
large number of Likes because you can market to them each time you release a
new product... in SignNow's case, they have 700 interested ears to begin each
new adoption cycle now.

Hard to quantify the value of that. My opinion is that it's worth a lot for
the early ears, but not if you are thinking short term only.

~~~
novum
Facebook calculates an "edge rank" for each piece of content based on metrics
such as likes, comments, post time, content type, and so on. Edge rank is
used, among other things, to determine the likelihood of a given piece of
content appearing in your feed.

Only a fraction of a page's fans will see each update from that page. By some
estimates, that number is only 5-10% of a page's fans. So they've earned 700
new fans, but that doesn't mean 700 impressions each time they post.

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patio11
I don't exactly want to hijack the thread, but let me present an idea of how
one could burn $1,000 if one wanted to do it for promotion.

Step 1: Install Wordpress. Good, already done.

Step 2: Create a big ol' list of keywords which you think are relevant to your
business. For example, [sign contract online], [sign document online], [sign
contract with iPhone], [sign contract with Blackberry], etc etc. This doesn't
cost anything more than your time.

Step 3: Design a template which, given a particular keyword, includes a few
hundred words of content about the keyword and also acts as a landing page for
your service. I'm assuming this is effectively free for most of us on HN. The
last time I did it it required copy/pasting one file in Wordpress and then
five minutes of hacking the PHP to do what I wanted it to do.

Step 4: Write between 50 and 100 of these, depending on how you get them done.
This is what costs the $1,000, since you're probably going to zone out after
doing this five times, write up the process, and then hire the rest out to
freelancers.

Predicted results: on average, depending on query volumes, you're going to
pick up a handful of hits for each page every month for life. So instead of
having 1,400 clicks once, you'll get somewhere on the order of 400 clicks a
month _for forever_. And instead of them being someone who was just gawking at
a pretty girl in Chemistry class or poking their sheep while farming virtual
cabbage, it will be someone who is _right now_ trying to solve a problem which
is costing their business money.

And if you have $2,000 to spend? It scales right on up.

And if you're savvy about how you do this? Suffice it to say that the MVP of
this project gets you a wee little asset to build a business on, and
implementing this strategy in a really effective way can basically carry a
business on it's back. This is not limited to bingo card publishing empires,
trust me.

~~~
e1ven
I know you've answered this before, but where is your go-to place for quality
writing? So many of the places that I've looked at seem Very low content.

The last thing I'd want to do is create a bunch of content that would make me
look bad in the process. If I'm putting it online behind my company's name, it
should be (hopefully) better writing than I could have done myself.

~~~
patio11
You don't have to be Nicholas Kristoff to write about signing contracts
online, assuming you have a product which signs contacts online. Everyone on
HN knows someone whose job description is Write Stuff About Business. Many of
them, particularly young'uns, are underemployed in this economy. Find them,
fix their problem.

I mean, you could walk straight into the English Department at any university
and offer them jobs for students. I guarantee you will get takers. Potential
problem: the takers will be English students.

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mcdowall
So essentially $1100 for ~600 likes, I certainly wouldn't be happy with that
return. It's an informative piece but I think your summary is a bit off
regarding the campaign a success generally.

I think by simply joining Facebook groups in this sector and engaging with the
group you could've achieved 600 likes in the same timescale and saved yourself
the money.

~~~
idoh
That's about the market rate for buying likes on Facebook (the company I work
for used to offer this as a service).

~~~
petercooper
Targeted likes or just likes in general? There are folks on Fiverr who can
deliver untargeted likes at 10 cents a pop (which might be useful for the
initial social proof). No idea how they do it but I tried as an experiment and
they don't all look like zombies.

~~~
idoh
That seems really low for me. The only way we could have done that would be to
use low value inventory like from developing countries, but usually the
advertisers had a certain demo that they wanted to reach and that raised the
price.

~~~
petercooper
Yeah, the demo is probably not good at all. But in terms of building up a few
hundreds likes in order to get social proof for later folks, it's an option at
least.

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alanlewis
And now the post on HN about the ads will generate far more impressions for
SignNow than the ads did.

~~~
mchusma
Thats the follow up article, expect it in the days to come.

~~~
jbwyme
But then... THAT will be on HN. Then what?

~~~
ltamake
An indefinite loop of follow-up articles, and every single one will be posted
on HN. :D

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aantix
I took a look at their ads and still do not have a clue as to what SignNow is
about. Still scratching my head as to what they were advertising..

~~~
tintin
Same here. I think the results are very bad. They say it's not about the
results but about branding. Well to be honest I can't remember there logo
already though I read the article..

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kposehn
Great experiment! Glad to see you got some engagement.

As someone who has run FB ads since the beginning though, I would disagree
with one thing: in my experience over the years, people are ok with leaving
Facebook, so long as you have a very nice, clean, easy to understand page with
a clear value proposition.

My suggestion going forward is this: 1\. Take each winning ad and make 3 more
variants. 2\. Take each interest you were targeting, make a separate campaign
for each. 3\. Place all variants of your winning ads in each campaign.

The purpose of this is to find which actual interest is responding to your
product. Once you find that out, refine it again by breaking up location, age,
gender, education, etc.

Get really granular over time. The end result is very good ROI and a solid way
of making money on FB :)

~~~
kposehn
Replying to myself here to give some info on my experiences with FB:

Here are my stats on the last week for one campaign where I make about $35-$50
on average per lead:

\- Spend: $3,345.30 \- Impressions: 6,305,765 \- Clicks: 2,570 \- CTR: 0.0408%
(average, some ads are near 0.1% and they make the most money) \- Average CPC:
$1.30 \- Leads: 237 \- Average CPL: $14.11 \- Revenue: $8,703.70

That's a pretty damn good ROI. Not every campaign does as well as this, but
taking the time to find your audience, craft your message and optimize will
yield good results.

~~~
amitagrawal
I agree. Those numbers are pretty good even for an AdWords advertiser. And the
fact that you've been able to scale it really well is even more praise-worthy.

Do you have a blog/website that I can follow?

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ig1
It stories like this that make me think I should just build an app that does
automated Facebook ad optimization, these guys could have done a lot better
than they did. I've run ads targeting US tech audience at 0.5cents a click.

A few tips:

1) Buy ads on a CPM basis, if you're getting a good conversion rate then CPM
is a lot cheaper than CPC on Facebook.

2) Don't target a bunch of keywords together, chances are some of those
keywords have great CTR and some of them have terrible CTR, running one ad
targeting them all means you can't filter out the poorly performing keywords.

3) Geographic focus, concentrating on the major tech areas rather than the
whole US would probably give them a much more targeted audience.

4) Their budget was too high to begin with, you can experiment on a much
smaller budget to get statistically meaningful results. Once you've figured
out what works then you can start throwing money at it.

~~~
ultrasaurus
According to my stats [1], the implied click through rate is .04%, so you're
very right this ad group would've saved money on average [.057%] (And almost
half if they had stuck with the .077% converting ad).

[1] <http://euri.ca/2011/04/facebook-advertising-prices-part-2/>

~~~
ig1
Nice model, unfortunately it doesn't work because of a couple of factors:

If you run CPC ads Facebook will show your ads more often to users who are
"click happy" (they've said so publicly), there's also an impression among a
lot of advertisers that Facebook charge a premium for CPC (which they haven't
been willing to confirm or deny)

Also if you're buying CPM Facebook give you a "quality" discount, so if you
have a good CTR you actually end up paying a much lower price than the initial
suggested bid.

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dcosson
Looks like they didn't really get enough traffic to do this (and idk how easy
it is to do with FB and google analytics) but it would have been interesting
and probably smarter to also measure each ad's effectiveness by how many
conversions it led to on their site rather than just click-throughs to the
facebook page. With their "most successful" ad they spent ~$500 to have a
bunch of 21-year-olds click on a picture of beer that says nothing about what
they do - I doubt these people will respond to a future marketing campaign any
better than a random set of the population.

In any case, the analysis was interesting enough to make the front page of HN,
which I'm betting will bring them a lot more than 139 visits. So well done
with that.

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iworkforthem
Most would agreed that campaign did not performed, instead aim to achieve CTR
> 1% and Bid < $1.

Facebook ads is used widely by affiliate marketers, you could spend some time
on blogs like MrGreen ( <http://stackthatmoney.com> ), or affiliate marketing
news aggregator ( <http://affbuzz.com> )

I would change the following if my objective is to get more likes & users.

\- Target person, i.e vc, developers, etc instead.

\- Limit and test the age groups.

\- Target Tech events.

Bids will be cheaper & CTR will be more targeted. If it is not CTR, KILL it.
Personally I like what you are doing at signnow, much easier to use than those
I used when opening up my trading account.

Maybe you want;

\- Add the Facebook icon or something to link to your Facebook page in your
website.

\- I am kinda of surprised that there's no YouTube explaining signnow,
considering doing a hipmunk-like video explaining what signnow does.

\- If you have existing customers, do a video case study what it does your
customers and how signnow could come in handy in other industries or
applications, etc.

~~~
kn0thing
re: the hipmunk video, Are you talking about a GrumoMedia video?
<http://www.youtube.com/watch?v=6teBPUgz4Y8>

~~~
iworkforthem
ya.. that's the one!

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ulvund
This looks ridiculously expensive for such low traffic numbers for a free app

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rickmode
Regarding the ad the worked best, I couldn't tell what the heck the image was,
and I'm curious - the image was interesting. Looks like a spiral of some sort.
(I didn't see it as a stack of beer until I looked back after reading what it
was.)

I suspect the higher click-through rate was more about curiosity about the
image.

~~~
ToastOpt
I have to admit, I've personally clicked through a couple ads for precisely
this reason, only to immediately hit the back button upon realizing it was
just an ad.

And the next time I see the ad, I do it again.

It may be effective at getting click throughs, but the retention rate likely
leaves something to be desired.

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brianjolney
a point for improvement: facebook's auction system is quite aggressive in
picking its favorites. Having that many ads in one campaign, especially one
with such a low daily budget, will cause one to get nearly all the impressions
and take over.

You also can't stop ads after only a thousand or so impressions. Let them run
for 50k+ before cutting, as an ad that performs well will take a decent amount
of clicks for the bid to fully come down.

~~~
drpancake
Facebook's own guide on A/B testing your ads suggests creating a separate
campaign for every single variation, in order to avoid this issue. I've still
found that just 1-2 clicks causes one variation's impressions to go through
the roof.

[http://ads.ak.facebook.com/ads/FacebookAds/FB_Ads_A_B_Testin...](http://ads.ak.facebook.com/ads/FacebookAds/FB_Ads_A_B_Testing.pdf)

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g0atbutt
Site is down. Does anyone have a mirror?

~~~
mchusma
too many images, just brought it up on the CDN to deliver the content better.

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mchusma
servers upgraded, sorry about any slowness.

