According to data from Hunch, the five major social media platforms – Facebook, Google (including YouTube), TikTok and Snapchat – all showed an increase in advertisers in Q2 2021. Facebook’s CPM price grew by 89%, TikTok 92%, Google and YouTube 108% and Snapchat, 64%.
Intense competition for attention within Facebook for ad reach and views has driven up the cost per 1000 impressions (CPM).
A major effect of the COVID-19 pandemic, especially for retailers, was to totally shift their customer acquisition efforts online. Utilizing Facebook, the world’s biggest social network, was the logical step but now the influx of more retailers using the platform to reach out to potential customers is driving up the competition.
What’s worse, however, is that the demand is outpacing the supply – the Facebook ad space has become oversaturated, i.e. retailers will be competing with each other even more and more for the attention of the same people.
In simple terms, if $100 on adspend on Facebook was getting 10 customers before, now the same amount is getting as little as 6 customers – a decrease of 40%. This will only get lower in the future.
The demand for ads being higher than supply generated by users not only puts pressure on the KPIs of the retailers (especially with higher CPA) but also on the bottom line.
So, how to solve this?
The answer lies in focusing on the end-user.
The key is to create campaigns that –
- Resonate with your target audience
- Drive up customer retention, as well as acquisition
- Are eye-catching
By making campaigns that are more personalized, you have a higher chance of forming a connection with the customer that can help in increasing the chance of a conversion.
Retention makes great financial sense, as Hubspot noted, “it costs anywhere from 5 to 25 times more to acquire a new customer than to retain an existing one.” Acquiring new customers is important, but so is retaining existing ones as they drive up the average lifetime value.
Hello Retail’s new Audience solution is here and can help you in achieving multiple goals ranging from increasing conversion rates, increasing customer retention and acquisition and more.
By first creating your free Audience account and sync with your store, then create relevant audiences like:
- Customers with the highest LTV
- Buyers of a specific product
- Buyers of a specific product categories
- First time customers that bought a specific product.
When the Audience is built, you can easily synchronize it to Facebook which enables you to create targeted audiences like:
- A target group of all who bought that red summer dress (so that you could market the perfect white shoes to go with them)
- look-a-like audience for all who might have been interested in that red summer dress (tell them about this amazing dress)
And yes, you can actually upload your customer lists manually to Facebook, just be aware, that the requirements on manual customer upload entails both that you need a list of 1000 and also that you have permission for this data. With Audience by Hello Retail you are not directly handling any data or violating any rights as we are making sure the data is kept anonymous. And you can create target groups with as little as 20 people who bought that red dress.
We will help you with training materials and guides for how to create awesome audiences, and the only thing you need to do when you are ready, is to sync your Audience with facebook with a simple login connection.
So what are you waiting for?