How to Make Money with Facebook Ads

by Ahmet Kirtok on November 23, 2009

Make Money with Facebook Ads

According to Facebook, there are over 300 million active Facebook users. While over 50% of the users login to their Facebook account every single day, fastest growing demographic is 35 years old and older. (If you are interested in finding out more about Facebook’s demographics & stats, check out Facebook’s stats page.)

Whether you are a small business owner, an online marketer or the head of marketing at a giant corporation, if you are still not using Facebook to get new customers and business, you are making a huge mistake.

Facebook has an ad platform called Facebook Ads, and you can start advertising on Facebook Ads with as low as $1 a day. Yes, it is 1 buck a day.

At the end of this article, you will be able to launch your first Facebook Ads campaign and learn how to optimize Facebook Ads. If you have been running Facebook Ads, you will learn some advanced tips for Facebook Ads targeting and split testing which will end up lowering your ad spent tremendously for the same amount of clicks.


How to Make Money with Facebook Ads article is written for absolute beginners in mind, but I will also be sharing some pretty advanced, never shared Facebook Ads techniques. I will also reveal the secret tool used by the top Facebook marketers. Some of these top Facebook marketers are my friends, they won’t be happy at all when they see that I’m sharing their secret weapon; “I’m sorry guys, please don’t get mad at me!“.

Okay… Enough said, let’s get started with the “How to Make Money with Facebook Ads” Guide.

I wanted to create an “Ultimate Guide for Facebook Ads”, and it has ended up being a much longer article than I originally intended. I didn’t want to leave anything out, I hope you will start making money on Facebook Ads after reading this article, or increase your net profits on already profitable Facebook campaigns.

Here’s the main categories in this guide, so feel free to skip the topics you are comfortable with and jump right into advanced tips:

How to Make Money with Facebook Ads Guide Index

  1. How to Find Products to Promote on Facebook Ads
  2. How to Start Advertising on Facebook Ads
  3. Advanced Targeting Tips for Facebook Ads
  4. How to Start your First Campaign on Facebook Ads
  5. Facebook Ads Bidding Strategy – CPC vs CPM
  6. Advanced Split & Multivariable Testing Tips
  7. How to Optimize Facebook Ads
  8. Recommended Resources for Facebook Advertising

How to Find Products to Promote on Facebook Ads

Before even getting started with the competitive analysis, you need to have a product or service to sell on Facebook Ads.

Facebook offers both demographic and location based targeting. If you own a local small business and your potential customers are local, this is great news. You can target by location, then demographics on Facebook Ads.

When we get into Facebook Ads advanced targeting tips, it will be a piece of cake to start running Facebook Ads for your local business like a seasoned online marketer.

If you don’t own a local small business, don’t worry, there are literally thousands of products in the market which you can start promoting. Let’s get started with a few ideas.

Product & Service Ideas to Promote on Facebook Ads

  1. Promote your own products on Facebook Ads. Local or national, Facebook Ads is a great place to promote your own products. Whether your business sells a tangible product, software, or even if you own a coffee shop, Facebook Ads is a perfect match to promote your own products and services.
  2. Promoting Affiliate Products on Facebook Ads. If you don’t own your products, don’t worry. There are hundreds of affiliate networks in the market, making thousands of affiliate products available to you. Whether it is a CPA, CPL, or a CPS campaign, you can start promoting well known brands on Facebook, and start making money right away on comissions. Here are two of my favorite affiliate networks if you like to signup and check out the offers. They both have thousands of offers available for Facebook Promotion: AzoogleAds and Neverblue Ads.
  3. Generate Leads on Facebook Ads. Whether for your business or for local clients, Facebook Ads is a great place to generate leads. Create an appealing landing page. List the benefits of the service/product you are promoting instead of its features. Ask the users to fill a short form. This is one of the best ways of collecting potential customer data. Did you know that local businesses would pay high dollars for this type of legitimate leads? Let me give you a real life example. I had a friend who has negotiated with his apartment’s manager, and charged $100.00 for every potential tenant he’s found via Facebook Ads. It cost him around $1.50 per lead he’s generated on Facebook Ads with super laser targeting. Use this tip, be creative and find other ways to convince local businesses to buy quality leads from you.
  4. Build a quality email list with Facebook Ads. Email marketing has the highest ROI in any type of online marketing. You can create a landing page loaded with information, and start building a quality double opt-in email list by promoting your landing page on Facebook Ads. Many online marketers, including myself, use Aweber to create double opt-in email lists and autoresponders. So, check Aweber out if you don’t have an email marketing software.

Ok, I have given you some ideas and tips to find products and services to promote on Facebook. As long as you are creative, you will be able to find good products and services to promote on Facebook, even if you don’t own one yourself.

Let’s get started with advertising on Facebook.
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How to Start Advertising on Facebook Ads

Before creating your first Facebook Ad Campaign, you have to understand how the platform works.

If you don’t have a Facebook account already, please signup and create your Facebook account. If you already have a facebook account, and if you are familiar with the website, most likely you have already seen facebook ads, usually running on the right sidebar while you are logged in to Facebook.

Please take a look at the image below. I have created a screenshot of current Facebook Ads being served to my profile (click on the image to view the full size):

Facebook Ads on Profile Sidebar

When I click on “More Ads” on the right bottom of the sidebar, Facebook shows more ads targeting my profile details. Below is the screenshot of what I see at “More Ads” page:

Click to Enlarge - Facebook Ads Examples

These are just a few samples of how Facebook Ads will look like.

Important Tip: You have to find out and analyze what your competition is doing before getting started with your first campaign. This is pretty easy with Facebook. You can open a Facebook account and enter the details of your potential customer’s demographics in your profile.

If your product is targeting female users in the United States between 18 to 21 years old who goes to college, just open a new account and setup your profile settings according to this. When you start browsing on Facebook, your competitors ads, who are targeting similar demographics will start showing up on your sidebar. Do this process over again by changing your profile settings to see different ads targeted for different demographics.

Customer Demographics Research Tip: If you like to do little bit more research about the customer demographics of the product or service you are promoting, you should check out Quantcast. Take a look at Facebook.com’s Quantcast Data as an example. Freely available data online is gold mine, and Quantcast is the right tool to start digging that gold out and find laser targeted customer demographics data.

You have done your research, found out what the competition is advertising on Facebook, now it’s time to learn more about Facebook Ads targeting before creating your first campaign.
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Advanced Targeting Tips for Facebook Ads

This is where all the magic is; Targeting on Facebook Ads. Let’s start with taking a look at targeting options on Facebook Advertising Platform.

Currently Facebook lets you target users in 12 different variables. Take a look at the image below which shows all the targeting options in Facebook Advertising (click to enlarge the image):

Click to Enlarge Image - Facebook Ads Targeting Options

Let’s take a close look at each of these targeting options on Facebook and share some advanced tips.

Facebook Ads Targeting Options:

  1. Location Targeting: Facebook Ads lets you target your potential customers by country, state and city level locations. What I hear from the rumors, zip code level targeting is coming soon. Even if you are running a national or international campaign, location targeting is the first place to start creating laser targeted ads on Facebook. If you are a local business, it’s a no brainer. But if you are promoting nationally, I will share some tips how to use the location targeting for your campaigns at the split testing section.
  2. Age Targeting: Age targeting is a standard demographic factor. If you have done your research right and come up with a well defined target market, it is time to select your target market’s age.
  3. Birthday Targeting: If you are creative, you can come up with some genius ideas to market to the birthday kid. If you are targeting users on their birthdays, you must do it on separate campaign, because most likely you will have a different ad text and image for this.
  4. Sex Targeting: Gender targeting gives you a chance to target to females or males only.
  5. Keyword Targeting: I can’t emphasize how important the keyword targeting on Facebook ads is. This is probably the most important targeting option on Facebook Advertising Platform, and you should spend some serious time finding the right keywords. Before your keyword research, try to think like your customer. Let’s give a real life example. A mediocre marketer likes to sell a subscription for an online hip hop music website. Since the marketer thinks mediocre, he/she creates one Facebook Ad Campaign, and adds all the keywords related to hip hop music, such as “hip hop, hip hop music, hip hop beats, etc.”. You get the idea. But a smart marketer (you are the smart marketer here), instead, does an excellent job of understanding the demographics of the potential customers, and comes up with some genius keyword targeting ideas. He/She starts creating separate Facebook campaigns for every single keyword. For every popular hip hop singer, he/she creates a new ad copy with laser targeted text and image. For Jay-Z (hip hop artist if you don’t know the name) fans, he/she creates a targeted ad with Jay-Z’s picture on it. Probably, you already got the idea, and running to open a new browser right now to start a new Facebook Campaign. If you can use the keyword targeting right with some creativity, you will be able to make some real money on Facebook. Think, think, think.. Think about what are the favorite TV shows of your customers can be? What type of food they might be preferring? What type of a car they might be driving? Ok, that’s enough, if I share more of my advanced keyword targeting tips with you, I might lose my profitable campaigns on Facebook :)
  6. Education Targeting: When I see an ad on Facebook which says, “Hey Red Raider!” (I’m a Texas Tech Alumni), I’m already sold. There are over 4000 colleges in the US. Here is another secret tool I use; National Center for Education Statistics Tool. You can get the list of all schools in the US for absolutely free. With the correct automation in place, you can create over 4000 college targeted Facebook campaigns out of your single campaign.
  7. Workplace Targeting: My wife is doing her fellowship at Westchester Medical Center in New York. One day, while she was on Facebook browsing, she gets all excited and tells me that “We should change our auto insurance company”, because this company named XYZ is offering a huge discount only for Westchester Medical Center employees. Do I need to explain anything else about the power of workplace targeting? We know the ins and outs of the game, but a regular internet user, doesn’t matter how smart he/she is, falls into these little marketing tricks easily. Use this powerful targeting option to create profitable, targeted Facebook ads.
  8. Relationship Targeting: Creative thinking will give you great use of relationship targeting. If you sell jewelry, create separate campaigns for each relationship status. Don’t try to sell engagement rings to already married users. Relationship targeting can become the most important option depending on what you are trying to sell.
  9. Interested In Targeting: The name tells it all. Try to come up with ideas to combine relationship & interested in targeting together.
  10. Language Targeting: I am originally from Turkey, and there are over 500.000 native Turkish speakers living in the US. Don’t you think you will steal my heart by serving Turkish ads to my profile in New York? Think about Spanish, Russian, German, French, and all other languages being spoken in US. I’m not talking about international targeting. I’m talking about targeting your own country (USA in this case) and creating separate ads for different language speakers. I can’t tell you how powerful this is. Ok, let’s give a real life example. A mediocre marketer will try to sell cheap airline tickets by advertising “Cheap Airline Tickets”, and a smart one will target Turkish Speakers in the USA, and will have an ad in both English and Turkish (split testing) saying “Cheap Airline Tickets to Istanbul, Turkey”. You can start extremely profitable campaigns even in the most competitive niches right from the start with language targeting. OMG, I’m giving too many secrets :)
  11. New! Connections Targeting: This is a brand new targeting option on Facebook Ads. I haven’t had a chance to try it yet, but it is pretty exciting. You simply target users who are connected to one of your pages, groups, events or applications. The sad part is, you need to be an admin of that specific page/group/event/application.
  12. New! Friends of Connections Targeting: This also sounds pretty powerful. You can target your page’s fans’ friends.
  13. More information about Connections Targeting & Friends of Connections Targeting from Facebook’s official announcement:

    If you are a Page admin, Group officer, Event admin or Application developer, you know how important it is to connect and engage with users who are connected to you. We’re happy to announce the ability to target Facebook Ads only to users who have expressed interest in your Page, Group, Event or Application with connections targeting. Connections targeting allows you to target fans, members of your Group, users who have RSVP’d to your Event and/or users who have authorized your Application. Simply look for the “Connections: Target users who are connected to:” field in the ad targeting interface to get started. As you begin to type the name of your Page, Group, Event or Application in the field, the names of all eligible content that you manage on Facebook will appear in the type-ahead. Use this opportunity to increase engagement, send alerts and promote special offers to users who have already raised their hand for more information.

    You can also choose to increase the number of fans and page views to your Page, members to your Group, attendees to your Event or users authorizing your Application by excluding your connections from seeing your Facebook Ad. To do so, simply look for the “Connections: Target users who are not already connected to:” field in the ad targeting interface.

Again, Facebook targeting is the key to creating successful ads on Facebook. You have to spend some serious time for research and game plan on the targeting options before you start creating your campaign.

In the targeting section, I have highlighted the importance of launching laser targeted Facebook ads over and over again. I feel like most of you will ask the same question to me:

Laser Targeting Sounds Great. But, How do you Create Thousands of Laser Targeted Facebook Ads?

This is where my secret tool comes into play. Again, many of the top Facebook marketers will get mad at me for publicly speaking about this secret tool. But, I am ready to take the heat.

I use a tool called Facebook Ads Manager, used and known by only a tight circle of Facebook marketers. Even though it is available to be purchased publicly, most Facebook advertisers haven’t even heard about it.

This is a Firefox plugin which sells for $199.00. My daily net profit has increased over 10 folds on the second day I’ve started using this tool. But more importantly, now I can create and launch thousands of Facebook campaigns within a few minutes.

I will talk more about this tool in the split testing section.

You can create, launch and manage Facebook Ads through Facebook’s manual interface. You can even hire employees and interns to manage hundreds of campaigns manually, but the secret to making money on Facebook is automation, and you won’t be able to generate high dollar figures without an automation tool.

Anyways, check out the Facebook Ads Manager to read more about what this tool does and how it will automate your Facebook Advertising Business.
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How to Start your First Campaign on Facebook Ads

Before opening your Facebook Ads account, you should google facebook ads coupon and try to find some fresh Facebook Ads Coupons. Facebook is handing out coupons at industry events. These coupons are usually worth $50 to $100 and good for new accounts. Many bloggers give out these Facebook coupons away for free. So, find a Facebook Ads coupon, if you can, before creating your Facebook Ads account.

After you’ve created your account, start by taking a look at Facebook Ads Best Practices page.

Click through Rate (CTR) of your Facebook campaigns will be one of the most important factors on how much per click you will be paying for your ads. My experience shows that the image you will be using in your ads is going to be the most important factor to get higher click through rates.

So, spend some time for researching and finding good, interesting, stupid, crazy, creative images. Prepare your images at Photoshop or your favorite image editor. Keep in mind to have your image sizes 110 pixels wide by 80 pixels tall. This is a pretty small size for an image, and you have to be extremely creative on your images to get attention right away.

Facebook pages are already busy with text, images, videos, etc., so you won’t have a chance if you can’t find creative images which will pull attention of the users and make them want to click your ads.

After your images, ad copy and targeting options are ready, you can start creating your first Facebook Ads Campaign.

All the information needed to be entered is straight forward. Since you already have in depth understanding of targeting options, it will be easy to create and submit your first ad.

Important Tip: At the bottom of “Facebook Ad Creation Page”, you will see an estimate number of people your ads will be served to depending on the targeting options you have chosen. This is a dynamic number, when you change a targeting criteria, this number will update automatically. So, take a close look at this number when you are creating your first ad.

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Facebook Ads Bidding Strategy – CPC vs CPM

If you don’t excel the bidding strategy for Facebook Ads, you might simply wast countless hours of work for creating all these Facebook campaigns.

Let’s start with basics, take a look at the screenshot below, taken on the Facebook Campaign Creation Page (click to enlarge the image):

Click to Enlarge - Facebook Ads CPM vs CPC

You can either pay for each click (CPC), or pay per thousand impressions (CPM). Making a decision on CPC vs CPM is a tough one. Simply put, there’s no one form of successful bidding strategy on Facebook. You have to try both methods, test and test again.

CPC sounds great first, you only pay for the clicks you receive. But the problem is, if you don’t get a good CTR, Facebook starts showing your ads less and less, ending up with zero impressions pretty quick. It kills many campaigns from the start which might be successful.

But in general, for the products and services I promote, I have a pretty successful formula which works great for me.

I start creating a number of split test campaigns with my Facebook Ads Manager tool and I launch all of them PPC based.

After analyzing enough data (depends on the volume of campaign, it might take a day or even a few hours to get enough impressions), then I pick the highest CTR campaigns, and create CPM based new campaigns for them.

The biggest advantage of CPM based bidding on Facebook Ads is, Facebook keeps showing your ads to the users even if they start getting less clicks. This way, your campaigns don’t die if they don’t get a good CTR for a day or two.

Again, this is how I approach CPM vs CPC bidding on Facebook, but you should test as much as you can before coming up with a default bidding strategy on Facebook.

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Advanced Split & Multivariable Testing Tips for Facebook Ad Campaigns

I use the Facebook Ads Manager for advanced split and multivariable testing for my Facebook Campaigns.

The screenshot below shows how I use Facebook Ads Manager to split to create laser targeted Facebook campaigns for ultimate success in Facebook Advertising:

Facebook Ads Split Testing

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How to Optimize Facebook Ads

To be able to increase the ROI on current campaigns and make the new campaigns profitable, you need to constantly optimize your campaigns.

Even though we have focused mostly on the CTR, the main goal should be the conversion rates. I use Tracking 202 Pro to track all of my campaigns. Even if I have thousands of Facebooks Ads running, it becomes very easy to track which ads are converting. Tracking 202 also has a free version which is great.

Whether the free version or the paid version, I’d highly recommend Tracking202 for anybody who is running Facebook Ads.

After you have proper tracking in please, simply setup your profit goals, and monitor all ad groups daily for the conversion rates.

Another important optimization tip is for laser targeted campaigns. Sometimes, it is easy to achieve excellent profit margins on Facebook with very targeted ads. But since these ads are served to a limited number of people, after a while, they start getting less clicks and conversion. This happens to me all the time. When my super targeted Facebook ads start getting little to no CTR’s, I try to modify the images, and ad text. But, again, some campaigns will come to an end on Facebook whether you like it or not. You have to profit from them while you can.

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Recommended Resources for Facebook Advertising

Here are two great books if you like to read further about Facebook Ads, Social Media Marketing and also in general Social Media. I will be updating this section with resources I find valuable for Facebook Advertising.

The Facebook Era: Tapping Online Social Networks to Build Better Products, Reach New Audiences, and Sell More Stuff. The title tells it all.

Facebook Era is an excellent outline of basic steps to a successful Facebook Advertising.

See what some authorities are saying about Facebook Era:

“People in all demographics and regions of the world are more connected than ever before to the products, issues, places, and individuals in their lives. This book recognizes that we’ve come to a place where people can represent their real identity–both personal and professional–and use the social filters on the Web to connect with the world around them.”

–Sheryl Sandberg, Chief Operating Officer, Facebook

“…A must-read for CEOs and other executives who want to understand Facebook and more importantly take the right actions to stay relevant and stay competitive.”

–David Mather, President, Hoovers, Inc.

Inbound Marketing is a great book and a must read for business owners who’d like to get a better understanding of social media.

One of the co-authors of Inbound Marketing is Dharmesh Shah of OnStartups. By the way, OnStartups is one of my favorite blogs.

See what some authorities are saying about Inbound Marketing:

“If you’ve been looking for a trustworthy primer on getting found online, here’s a great place to start. Buy one for your clueless colleague too.”—Seth Godin, author of Meatball Sundae

“If you have more money than brains, you should focus on outbound marketing. If you have more brains than money, you should focus on inbound marketing by reading this book.”—Guy Kawasaki, cofounder of Alltop, and author of Reality Check

Here’s also a good blog post from Business Insider, written by Nick O’Neill; 10 Rules For Advertising On Facebook.

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In Conclusion

Since you are reading the last paragraph, you have spent your valuable time to read until the end of this post, thank you for that. I am glad you are excited about giving Facebook Ads a try, and I hope you have found the information I’ve shared valuable.

99% of business owners who read this article will never even give Facebook Ads a good try (I’m sorry but it’s real life data from experience). Don’t be in the 99%, and start creating your first Facebook Ad today. The best advice I can give you about succeeding with Facebook Ads it; by doing it and testing, testing, and testing until you find enough profitable campaigns.

Please share your comments below, and I will try my best to answer any questions you might have about Facebook Ads.


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{ 2 trackbacks }

The Power of Workplace Targeting in Facebook Ads - Facebook Workplace Targeting
December 3, 2009 at 9:14 am
Facebook Ads College Targeting Case Study
December 11, 2009 at 3:26 pm

{ 7 comments… read them below or add one }

1 Lydia December 6, 2009 at 3:55 am

Great post! Very informative. Thank you for going into so much detail. I’m looking forward to trying to at least make a few extra bucks with Facebook ads and putting all your tips to some use.

Reply

2 Ahmet Kirtok December 6, 2009 at 11:35 pm

Lydia, thanks, I’m glad you liked it. Let me know if you have any questions.

Reply

3 Chris @ BuildMyBudget December 8, 2009 at 1:17 am

Thanks Ahmet, I appreciate this valuable information as well! I’m hoping it can help me increase traffic and conversion on my website!

Reply

4 Kev December 18, 2009 at 4:27 am

Very detailed post, I will be trying facebook ads. But where do you get your images for the ads? It seems most people, rip them from the web. That seems the only way to actually get good images.

Would be super expensive to buy each image you want from a stock photo website, plus they usually dont have the kind of images we need. Should we be worried about using any images we find on the web, like the image owner seeking damages or part of the profits made via there ad image?

Reply

5 Ahmet Kirtok December 20, 2009 at 5:45 pm

Kev, you have two options; either get them from a stock photo website, or simply find them on web. 99.9% of people just find them on the web and use them.

Good luck with facebook ads.

Reply

6 James December 21, 2009 at 1:21 am

an excellent article – thank you!

do you have any experience in lead generation for network marketing / mlm? FB seems to very strict in this regard.

any tips for getting ads approved in this area?
best,
james

Reply

7 Ahmet Kirtok December 29, 2009 at 3:43 am

Thanks James. I haven’t done any MLM. I’d recommend trying maybe a 2 step landing page with email list building (with lots of quality content to share, etc.), then promote to your double opt in list you’ve created via facebook ads.

But again, I haven’t tried MLM via Facebook Ads.

Good luck.

Reply

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