The holiday season is every marketer’s dream and nightmare.
It’s this time of year when customers are primed for purchasing. Black Friday, Cyber Monday, Christmas, Boxing Day, New Years—the biggest sales days are packed into a two-month period.
It’s also when marketers start increasing advertising budgets. With so many big shopping days, mant company will increase spending, especially with Facebook ads.
So how can small and medium sized businesses compete against these large advertisers?
This post will show you how.
In this guide, you’ll learn:
- How ad costs are affected by the holidays
- 3 reasons why you should start preparing now
- Tactics and formulas to prepare for November and December holiday campaigns
How Do Holidays Affect Facebook Advertising?
Competition for limited ad space heats up during the holidays. You are not only competing against big brands, but thousands of smaller advertisers who want in on the game.
Advertisers with the biggest budgets don’t always win Facebook auctions. Facebook’s auction system is based on a number of different factors, some of which are influenced by price.
With all this competition, your normal strategy might not work. That one niche audience you use could be too expensive. That’s a real problem.
Ad Costs Increase
More competition means higher ad costs.
A study by Social Code in 2014 and found CPMs rose dramatically in November and December when competition increased.
In 2015, Facebook tracked ad costs during the holiday season. They showed that CPMs increased by over 100% during the holidays.
Ampush’s study showed that almost all metrics increased from mid November to the end of the year.
So costs are already starting to increase.
More People Shopping Online
More and more people purchase Christmas products online.
In the U.S., 40% of consumers plan to purchase holiday gifts through a mobile device.
Adobe predicts an 11% year-over-year increase in online sales this year, to $91.6 billion dollars.
And a Deloitte Study showed that people planned to spend just as much online as they do in-store during the 2016 holidays.
People are online, and willing to buy your product.
3 Principles of Better Holiday Campaigns
Warmer is Better
Leads can be broken into two categories: warm and cold.
Cold leads have no relationship to your brand. They haven’t viewed your content or engaged with your account.
An example of this is using interest or demographic targeting on Facebook. These people don’t have a pre-existing relationship with you.
Another example are lookalike audiences. While they may be similar to your customers, they aren’t yet a warm lead because they haven’t interacted with your brand.
On the other hand, warm leads have a pre-existing relationship, or have engaged with your brand. Within Facebook, warm leads are anyone from the following audiences:
- Facebook page fans
- Website visitors
- Lead form, video or canvas ad viewers
- Event attendees
- App users
Warm leads are primarily created through custom audiences.
Warm leads are a vital part of your pre-holiday strategy. If you haven’t already done so, start building your warm audience immediately.
Invest Early and Often
The earlier you invest in Facebook ads, the better the results.
The same applies to Facebook. Building your warm audiences early means a closer relationship between you and your potential customers. When the Holidays arrive, they’ll be more open to buying from you.
Rather than spacing out ad spending, choose campaigns with good performance, and start scaling right now. Investing more in November will pay off in December, especially with advertising costs steadily increasing.
Outsmart Other Advertisers
Chances are you aren’t a billion dollar company.
Unfortunately, you still have to compete with those large companies. There’s no way to beat them with money or by bidding more. Spending more won’t necessarily mean better results or more sales.
Instead, you need to spend money more strategically.
By structuring your ads the right way, and understanding how the holidays affect your ad campaigns, you can get more sales and leads while keeping costs down.
14 Advanced Strategies to Prepare for the Holiday Season
In the rest rest of the article, we look at specific formulas and strategies you can start using right now to prepare for the holiday season.
1. Invest in Video Content For Better Retargeting
Since video is such an engagement content format, it's a great way to build a warm audience.
Here’s an example of a video campaign we ran.
You can see the cost per 10 second view was $.20. 10-second views are a better indicator of engagement than 3-second views.
And here’s an example of a website click campaign.
Notice the cost difference? 10 videos second views cost 75% less than website clicks. That means our retargeting pools is larger than website clicks.
An added benefit? You can retarget video views up to 365 days later. Website clicks? Only up to 180 days.
💡 Tip: Build a warm audience of video viewers before holidays start.
2. Increase Your Remarketing Audience
For many advertisers, website visitors are a better audience than video views. And many advertisers can’t invest in effective video content.
In that case, you’ll want to start building a large website visitor remarketing audience before the holidays. With costs rising in late November and throughout December, you should start building a remarketing audience immediately.
The best way to build a remarketing audience is by serving interesting and engaging content to potential customers.
Here’s how to set this up the right way.
First you’ll need to choose your audience.
Choosing the right objective is important. We’ve had better luck selecting Website Conversions, even when the objective is link clicks.
Start by targeting lookalike audiences. Build them to look like website visitors, conversions, pixel events, or purchases—your pixel will need to be set up already.
Make sure to exclude all your retargeting audiences. That means video views, canvas and lead form engagements, and anyone who’s clicked an ad.
Selecting optimization type will impact on costs. For larger audiences, we’ve gotten better results by selecting website link clicks. For smaller ones, we usually choose unique daily reach or impressions.
💡 Tip: Immediately start building a remarketing audience for the holidays.
3. Train Your Pixel to Find the Right Audience
The Facebook Pixel is every advertiser’s secret weapon.
In most cases, Facebook will know who to reach better than you. Account history, website metrics and pixel traffic all feed into your pixel performance. Every time an event is triggered, Facebook learns more about your target audience and who best to serve your ad.
You can train your pixel to find target audiences by choosing and optimizing for specific conversion events. Facebook will learn who completes those events, and serve ads to similar users.
But Facebook’s pixel needs enough data to find people who are likely to complete your event. In most cases, they require 20-25 conversions per day for 1-day conversions, or 25 per week if 7-day conversion window is selected in bidding.
What if Total Conversions are Low?
Unfortunately, not every pixel gets that many conversions, especially product purchases. In that case, you can target a different activity such as email sign-ups or content views.
Some advertisers disagree with using content views as a conversion event, but we’ve found this effective to build a large retargeting pool.
💡 Tip: Invest in pixel conversions to train your audience. Focus on smaller conversions purchases are not possible.
4. Build Your Email List
There’s a reason why advertisers spend so much money increasing email subscribers: email lists are a great source of customers.
Unfortunately Facebook ad costs are already increasing. But you can still invest in increasing your email list before December.
The best way to build your list is by giving away free content.
This is a proven way to increase your email list. Think about the product or service you sell, and what your audience would find interesting. Then create downloadable content they would find interesting and run ads to it.
💡 Tip: Build your list by giving away useful free content.
5. Determine Email Life Time Value (LTV)
Knowing the value of an email address helps you bid more strategically for leads and products.
Here’s how to find total value:
LTV = total $ of products sold to your email list / total # of emails collected
Let’s say an email is worth $30 in life time value. And let’s say you’re willing to pay $15 per email conversion. Now you know you can bid up to $15 per lead.
To do this, select the bid amount, choose manual, and set the bid value to $15 average. This will ensure that on average, you pay $15 per conversion.
💡 Tip: Understand LTV of emails and set your bids accordingly to bid the true value of your emails.
6. Use the Right Objective Per Channel
Facebook has two lead capture campaigns:
- Lead ads
- Website conversions
The objective you choose can affect ad costs.
AdEspresso ran an experiment to see whether Lead Ads or Website Conversions had a lower cost per lead. Overall they found no real difference in total costs.
But platform type impacted results. Lead ads performed better on mobile, and website conversions performed better on desktop.
💡 Tip: Experiment with lead ads and landing pages on mobile and desktop.
7. Increase Daily Budgets
Facebook serves ads based on auction data. Many factors determine if your ads appear but price is still an important one.
Larger daily budgets impact the chances of your ads being served. By increasing your daily budget, you allow Facebook to bid more for your target action, and show more ads.
Don’t be concerned about spending your total daily budget. If you’ve set a low bid, there is almost no chance your daily budget will fully spend.
💡 Tip: Increase daily budgets in November to win more bids and increase ad delivery.
8. Create and Test Dynamic Product Ads
The secret weapon of every ecommerce advertiser are Dynamic Product Ads.
Facebook dynamically generates ads based on actions people take on your website.
How good are they? Point It Digital Marketing compared Dynamic Product Ads versus normal remarketing ads. The results?
- 44% increase in click-through-rates
- 77% lower cost-per-click
- 74% lower cost-per-action
Setting up Dynamic Product Ads can be straightforward, but more advanced customization may require a developer.
Create and Upload a Product Catalogue
List your product attributes in an XML or CSV file. These attributes auto-populate each part of your ad, such as name, landing page URL and image URL.
You have to upload this through your Business Manager account.
If you use Shopify, you can set up your product feed using the Facebook Product Feed app.
Setup Your Pixel
You will need to modify your pixel to report product IDs, and different pixel events like product views, added to cart and purchased.
Setup a Dynamic Ad Template
You need to create a dynamic ad template to generate each ad. You can use multi-product or single product in the Newsfeed or Right-Hand column.
Run the Campaign
Setup your campaign and start running it!
Strategies for Dynamic Product Ads
We recommend using November to test Dynamic Product Ads to see what works.
Provided your site gets enough traffic, you should test out the following ad set campaigns:
- View products, but no purchase
- Clicked on email product, but no purchase
- Added to cart, but no purchase
- Cross-sell to past customers who match certain interests
- Up-sell to recent buyers who visited your website again
- Sales and promotions
💡 Tip: Setup and test Dynamic Product Ads and use your findings for holiday campaigns.
9. Setup Offline Conversion Tracking
Offline conversion tracking lets you track any offline conversions, like in-store sales or leads, that occurred as a result of a Facebook ad.
This is incredibly useful for small business advertisers who rely on physical in-store sales, but want to track ROI from Facebook advertising campaigns.
Setting Up Offline Conversions
You’ll need three things to setup offline conversion tracking:
- Offline data file or API connection
- Ads Account
- Business Manager
Next you’ll need to create an event in Business Manager.
Go to Business Settings and select Offline Event Sales.
Name your offline event and the description.
Then choose the Offline Event and upload the corresponding data and follow the instructions.
Tracking Conversions for Offline Events
You can select offline conversion tracking in the Tracking section of your ad set.
Select Offline Events Tracking and select your offline event.
View Offline Conversion Results
To see your offline conversion results, go to the Ads Manager and select Columns and Customize Columns.
Then choose any of the Offline conversions you with to track.
💡 Tip: Setup offline conversion tracking to understand how your campaigns contribute to offline purchases.
10. Optimize Your Mobile Experience
Many advertisers, especially large retail brands, don’t differentiate mobile or desktop targeting. Everything is lumped together into one ad targeting group, even though mobile and desktop experiences can be different.
Research data shows how important mobile is to holiday shopping:
- 4.2X more often that people access Facebook on mobile phones before holiday shopping
- Shoppers in 2016 are for the first time expected to use mobile more than desktop for holiday shopping
- 56% of in-store sales were influenced by mobile activity
- One study showed that 38% say they will not return to a retailer’s website if it’s not mobile optimized
With all this in mind, how can you take advantage of increased mobile usage?
Make sure your website is optimized for mobile. If you’re using Shopify, your website is already designed to work on any device.
Test and optimize mobile campaigns. Understand what products drive mobile purchases or in-store visits, and apply those findings during the holidays.
Build a profitable mobile campaign. By creating a profitable campaign early, Facebook will know your target audience. This saves you money during the holidays as Facebook already knows your target audience.
Build mobile retargeting traffic. Setup a campaign to target only mobile devices.
By building a retargeting pool early, you can reach mobile users during the holidays at a lower cost than your competitors.
💡 Tip: Optimize your sales experience for mobile right now or miss out down the road.
11. Experiment with Event Value Targeting
Facebook’s newest audience targeting tool let’s advertisers target audiences by the value of a Facebook event.
In preparation for the holidays, you should experiment with the following audience groups:
Up-sells on low purchase-value audiences
Up-sells on specific products or product themes
Customers who used iOS devices
Be sure to experiment with these audiences beforehand to see if they are worth targeting during the holidays.
💡 Tip: Use advanced custom audiences to see if targeting by purchase data increases sales.
12. Test Local Awareness Campaigns
In September 2016, Google commissioned a study on mobile device usage and shopping:
- 87% of people within the study visited a retailer’s website or app on their smartphone
- 61% of people visit a retailer’s app or website before purchasing
Customers also engage on their mobile devices inside a store. A Business Insider study found that 70% of store shoppers use their mobile device in-store every single time or on a regular basis
You need to prepare for in-store visits. The best way to do this is by experimenting and testing Facebook in-store traffic campaigns.
Local Awareness Setup
Using this campaign is easy. Just select the Local Awareness objective and you’ll be given a 1-mile radius around your store.
Using this objective has it’s advantages:
Context specific map cards. This shares locally relevant details with your audience, like a map pin, distance to business and hours of operation
Store-visit call-to-action buttons. You can use Get Directions, Call Now, Learn More and Send Message call to action buttons.
💡 Tip: Experiment with location-based campaigns before key holiday dates and use data as a cost benchmark.
13. Get Access to Offline Purchase Objectives
Companies with multiple business locations should use the Store visit objective.
Here’s why you should use this campaign objective:
- Location-contextual information for each business location
- Proximity-based ad content
- Proximity-based maps
- Set boundaries based on population density
To use this objective, you’ll need locations enabled. Do this by contacting Facebook, and following the instructions.
Setting up and testing store performance will ensure you spend money on top-performing locations, rather than waste money during the holidays.
💡 Tip: If you own multiple stores, contact Facebook to setup Facebook locations.
14. Review Breakdowns to Determine Most Valuable Audiences
Understanding how to use Facebook breakdown data is key to increasing leads and sales. By analyzing breakdown data like platform or device, you can see what audience segments perform the best. We’ll use our Instagram Advertising Guide as an example.
We tested four different platforms:
- Facebook Mobile Newsfeed
- Facebook Desktop Newsfeed
- Facebook Right Hand Column
In this case, mobile devices performed best.
Our data shows that Android Smartphones and iPhone were the main devices people used.
This breakdown shows results based on platform.
In our campaign we tested Facebook and Instagram. Facebook unsurprisingly was the best performer.
The best country was Indonesia, followed by United States and Turkey.
Unsurprisingly, young people were most interested in our Instagram Guide.
Using Breakdowns is an incredibly powerful way to understand your audience.
Be sure to test wider audiences throughout November. This will ensure you have enough data to make informed decision over the key holidays.
Based on our data, we would break out 18-24 audiences who use mobile devices, and increase our bids and daily budgets. That way we’re bidding on more profitable audiences
💡 Tip: Determine most profitable audience segments before key holidays.
Thanks for reading. If you follow even a few of these tactics, you should be ready to ramp up sales during the holiday season.
Did we miss anything? Need anything clarified? Scroll down to the comment section and let me know what you thought.
About the author: Tara Mahoney is a writer and freelance software designer & developer working in Toronto, Ontario.