How To Build a Facebook Ad Segmentation Strategy For Money Well Spent

Where Are Your Dollars Going?

There’s a John Wanamaker line I’ve reflected on more than a few times when firing up a new campaign—you know, the campaign where the creative is just right, the targeting is to a T, market research is incontestable, analytics are bang-on and there’s a keen sense that this one is going to be a winner. That line is, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

Fast forward 100 years or so from the ‘offline’ world that John Wanamaker was familiar with to today’s world, where money is being poured into digital advertising. An often-perceived benefit of digital advertising is that every penny spent can be tracked and analyzed in some way or another. For tracking, we have free (or at least relatively cheap) and easy access to analytics software, tag management software, multivariate testing, and heat mapping. On the analysis end, we have marketing automation software, LTV calculations, lead scoring, and so many spreadsheets we need 32GB of RAM so our CPUs don’t melt. Most of this stuff is easy to implement and a marketer can begin leveraging these items to their benefit in essentially real-time. And then there’s the powerful, big-data-driven targeting capabilities provided to us by ad networks like Facebook and Google. Mash all this together and it quickly becomes apparent where, when, and on whom your advertising dollars are being spent. It’s impressive!

We can arm ourselves with all the tools, targeting, and data that time and money can buy—but these things don’t necessarily get us closer to effectively spending our advertising dollars. To really be effective at spending our dollars we also need a well thought-out marketing framework and targeting structure—the ‘how’ part of the marketing equation.

Below, I’ve laid out how I like to approach this on Facebook.

Using a Marketing Funnel and Audience Targeting Structure on Facebook

The digital marketing team at Perk Canada lives and breathes performance marketing, particularly with Facebook. In addition to our content distribution and branding efforts, we also invest our efforts in users who complete specific actions. One of the ways we’ve found to be highly effective at acquiring the right user at the right time with the right message is audience segmentation based on a traditional marketing funnel. However, we’ve taken the traditional funnel and distilled it into a framework of three segments, which we then use to target four unique Facebook audiences.

Acquisition

At the upper end of the funnel our main objective is to bring new users into the funnel. This stage is typically the first interaction the user has with us and they usually have no prior knowledge of the brand. To reach these users we target two unique audiences: interest-based, and lookalikes built from our website pixeled users and page-likers (more on that below).

Targeting either of these users with a Facebook paid advertising campaign is a relatively easy process. For interest-based targeting, simply select from a list of predefined Facebook interests that most closely align with the users you’re interested in targeting. In our case, we used a combination of market research, competitive analysis, and analysis of the behavioural data we’ve collected internally in places such as Google Analytics to define this list.

For lookalikes, define the ‘source’ audience as well as the geographic location and allow Facebook to do the rest. Lookalikes are very powerful because they allow you to take a unique source audience that you’ve created through past marketing efforts and extrapolate it based on the many data points Facebook has on its users. This effectively allows you to reach thousands if not millions of additional users that are ‘lookalikes’ of your source audience. When targeting audiences at this stage of the funnel we also include age, geographic location, language, and gender in our targeting.

Generally, audiences at this stage are our biggest groups; they allow us to cast the widest net and reach the most users. It’s an excellent way for us to distribute content en masse and begin developing a relationship with those interested. While these users can often be cheaper to acquire than the users at lower stages of the funnel, long-term ROI is usually not as high and actions they perform can be quite different than the users at the lower end of our funnel. The end goal at this stage of the funnel is to create awareness and foster repeat visitors.

Retention & Engagement

In the second stage of our funnel our primary mission is to continually engage users and demonstrate value. The users in this group are already familiar with the brand because they’ve been fueled by the acquisition audiences from above. All the users in this group will have visited our site at least once in the last 180 days, will have a higher likelihood of engaging with our content because of their familiarity with it, and will have a burgeoning sense of what the brand represents.

We call this audience our website audience, and at the root of it they are a pixeled user reached via retargeting. Since engagement and retention is critically important to us at this stage, often this audience will receive a different user experience than our ‘acquisition’ audiences and we strive to ensure that they receive a steady stream of our content. Additionally, at this stage of the funnel we begin promoting our email newsletter and page-like campaigns, to allow for this user’s progression into the next stage of our funnel.

When building audiences at this stage keep in mind that setting retargeting audiences up on Facebook is, again, not that difficult. Simply grab a small piece of code provided by Facebook and install it on the pages of your site where you’re looking to capture users for this audience. Then, in the ‘audiences’ section of Facebook ads, define a custom audience using website traffic. You should easily be able to find Facebook documentation on this if you’re struggling to implement.

VIP

The third and final stage of the funnel is where our most coveted users live. These are our Facebook page-likers, who have demonstrated the greatest intent to receive content from us and are more likely to engage with our content. The goal with this group is to create high lifetime value brand advocates who amplify and share our brand with the world.

We ensure these users receive our absolute best user experience, and that they are continually nurtured with our highest quality content. This group is generally our smallest audience by the numbers, but most likely to be engaged users who are proponents of the brand, with a higher long-term ROI. If you’re looking to replicate this, targeting these users is a matter of simply selecting your page in the ‘connection type’ section of Facebook targeting.

A final note about audiences; for each of the four audiences involved in the facebook ad segmentation targeting strategy above, don’t forget to add relevant exclusions to each group so you are not targeting the same group twice. For example, you’ll likely want to exclude the page audience from all your other audiences so you are not targeting them twice with another campaign.

Money Well Spent

I think every marketer is striving for the marketing Holy Grail: the right time, in the right place, with the right message. With all the data, tools, and targeting available to marketers it’s easier than ever to track your dollars, but how effectively has the money been spent to get to that point, and can you expand from there?

When searching for the marketing Holy Grail don’t forget to think about ‘how’. If John Wanamaker were still around today, I have no doubt he’d be able to more effectively account for which of his dollars were most effective in his marketing efforts, especially if he played in the digital space. But would he understand the inputs necessary to getting him there? And would he be able to build and scale beyond what his data tells him?