Does a Bigger Budget for Facebook Ads Mean More Sales?

If you think Facebook has become a pay-to-play social channel, you are not alone. According to research from Databox, 67 percent of marketers say reaching their audience organically on Facebook has gotten harder in recent years.

In 2014, due to the quantity of content being published on news feeds, the social media giant refined its algorithm to show more relevant content to its users. Then, in early 2018, Facebook announced that it would “shift ranking” to become “more about connecting with people and less about consuming media in isolation.”

The result has been a steady decline in the organic reach of your brand page.

One way to counter the trend is to spend money. By advertising on Facebook, brands have more control over who sees their message and the number of people who actually see it.

But how well does it scale? If you increase your ad spend, will you also increase leads and win customers?

Databox polled a couple dozen agencies. Most marketers said ads are effective, but on the question of whether spending more generates more sales, the responses yielded a series of “if”s. Among variables: your sales teams and audience.

Your Sales Team

“Your ads can be the most engaging and memorable ads on social media,” says Keri Lindenmuth from KDG. “However, if you don’t have a sales team that’s able to listen to customers and their needs, you won’t make as many sales as you hoped.”

Your Audience

HealthJo’s Rick Ramos gave this example of the importance of audience size: “If you are a toothpaste manufacturer, basically, everyone can be your audience,” he said. “Their target is anyone with teeth.”

If you sell to a niche, you will see diminishing returns in such investment.

“Whether you can scale your ads on Facebook depends on how much room you have left to grow,” said Rick Kranz of OverGo Studio. “It doesn’t always equate to spending more money. Yes, in the broad B2C market there is usually some room to scale once you have your offer nailed down. But in the narrow B2B niche it is more about finding the right combo of offer, objective and audience. Just spending more money usually has a diminishing return.”

These are among 10 “if”s included in this analysis. See the article in its entirety at FarmEquip.org/Facebookads.