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Facebook has done an exceptional job at making Ads Manager extremely intuitive. As a result, most marketers and business owners can quickly learn how to launch their first ads. One element of Facebook advertising that is worth diving into is niche audiences. 

But, while it might be easy to launch your ads, making them profitable can be a real challenge.

The good news is, I’ve audited close to 500 Facebook Ad Accounts, and the biggest reason I see Facebook Ad campaigns struggle is a lack of audience testing.

Whether you’re wanting to try advertising on Facebook, just starting out, or a seasoned vet, audiences will most likely have the biggest impact on your cost per lead or cost per purchase over anything else.

There are 1.09 BILLION users on Facebook…you can definitely find your audience, it just comes down to how much you are willing to invest. The question is, how?

Audience Insights

Do you have a Customer List, People Connected to your Page (page likes), or a Facebook Custom Audience based on website traffic? If so, start your audience creation by using Audience Insights.

Audience Insights is a tool designed to help marketers learn more about their target audiences, including aggregate information about geography, demographics, purchase behavior and more.

As you might imagine, this tool is insanely powerful!

Note, in order to use audience insights, you’ll first need to upload your customer list or track website traffic as a Custom Audience. However, if you have a good email list or have been tracking your traffic, you can click this link to get to Audience Insights.

You should now see a screen that looks like this:
Audience Insights #1

Once you’re in Audience Insights, select your custom audience:
Audience Insights #2

Once you’ve chosen your custom audience, Facebook will begin giving you info about the Demographic, Activity, and Purchase Behavior of your customers.

For example, Facebook provides you with buyer persona names—they call them “clusters”—and definitions to go with each cluster (Top Professionals, Established Elites, Summit Estates, Active Lifestyles, etc).

When you hover over the info symbol, Facebook will give you a description to go along with their cluster name.

So, in the above example, we know that Disruptive Advertising clients are 200% more likely than the average Facebook user to be Top Professionals, which Facebook describes as follows:

Skyboxes & Suburbans is one of the best-educated of all the clusters. These families shop at upscale stores, spend time feathering their nest and adhere to regular fitness programs.

If this definition is too vague for your liking, you can go through each section (Demographics, Page Likes, Location, Activity, Household and Purchase) of Audience Insights and do your own analysis:
Audience Insights #4

Audience Creation

When creating audiences, resist the urge to add & layer as many things as possible. Facebook Ads is a marketplace, and you’re bidding against other marketers and business owners on Interests, Behaviors, and Demographics. As a result, the more you layer (using “and logic” or narrowing further), the more expensive your audience becomes.

I typically like to start broader and then narrow further. Here’s how I define broad and narrowed audiences:

Broad Audience: > ~10 million users

Narrowed Audience: < 1 million users

For example, if you’re targeting Business owners, you could start with just Job Titles (depending on your business, you could also start with Interests, Behaviors, or other Demographic info):

Note the potential reach of 1,800,000 people. This doesn’t mean you’ll reach 1.8 million people; instead you’ll reach the active users of those 1.8 million people. We’ve found that’s typically around 20% of the potential audience size—so about 360,000 people.

Alternatively, I could also create an audience by layering business interests:

Use your buyer persona info to create a few test audiences. Like anything in life, it’s most likely going to take some practice and tests before you find your champ, or an audience that helps you achieve your cost per purchase or lead goals.

So, when it comes to creating your audiences: TEST. TEST. TEST.

Statistical Significance

Now that you’ve gotten a bit carried away and created 93 test audiences, how much money should you put behind each audience, and how long should you let it run before you know if it’s working?

As a general rule of thumb, I typically divide my cost per purchase or lead goal by 3-5, and use that as my daily budget. That way, I’ll know if I should pause or invest more into my audiences after 3-5 days.

For example, if your cost per purchase or lead goal is $75, I’d set a daily budget of $15-$25 per audience. I don’t like to just set it to $75 and then call it after a day. I like to give Facebook’s algorithm some time to try to find a more niche audience within the audience I created.

As you start to test your audiences, it’s important not to base success on leading metrics like click through rate, cost per click, add to carts, start of a lead form, etc. These metrics can help you decide whether or not your audience is worth continued testing, but they don’t really answer the most important business question:

Does this audience drive profitable sales?

So, let’s say you’ve spent your $75 and haven’t had a purchase or lead, but you’ve seen 5 people add to cart or start a lead form and know your average conversion rate is 20% when someone adds to cart or starts a lead form.

In this situation, I would definitely keep the audience running, because historical data justifies it and tells you you’ll be getting a purchase or lead.

Eventually, you’ll be able to know your add to cart or lead form start conversion rate from Facebook Advertising, but early on it’s best to assume that your Facebook traffic will follow your typical purchase patterns. That way, you don’t miss out on leads or sales by ending a test too soon!

Our Facebook Advertising Mantra

When you get right down to it, there’s no crazy-secret sauce to succeeding on Facebook. In fact, you can sum it up in one simple mantra:

TEST. ANALYZE. OPTIMIZE.

At Disruptive Advertising, we manage millions of dollars a month in Facebook Advertising spend and have learned what audiences and ads work and know where to start. At the end of the day, we’re testing, analyzing and optimizing.

As a result, we know which audiences produce the best results, and we can focus our clients ad spend on those audiences and drive the results their businesses need. And, now that you know how to use niche audiences, you can do the same.

About The Author

Saunder Schroeder

Saunder is passionate about growing brands through digital marketing, and has done so for Fortune 50 to startup companies. He’s a legend in his own mind, and is obsessed with his family (wife + baby girl), football and sweet potato fries.


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