FACEBOOK MARKETING AND CAMPAIGNS OF A GIVEN COMPANY
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Masarykova univerzita
Ekonomicko-správní fakulta
Studijní obor: Podniková ekonomika a management
FACEBOOK MARKETING AND CAMPAIGNS
OF A GIVEN COMPANY
Facebook Marketing a kampaně dané společnosti
Bakalářská práce
Vedoucí bakalářské práce: Autor:
Ing. Dušan MLADENOVIĆ Jan MACHEK
Brno, 2017
N a m e o f t h e a u t h o r: Jan Machek N a m e o f t h e t h e s i s: Facebook Marketing and Campaigns of a Given Company Če s ký ná zev pr áce: Facebook Marketing a kampaně dané společnosti D e p a r t m e n t: Corporate Economy S u p e r v i s o r: Ing. Dušan Mladenović Y e a r o f d e f e n c e: 2018 Abstract The subject of this thesis is Facebook marketing and its application in the form of an advertising campaign. The work is split into two parts, theoretical and practical. The first theoretical part starts with a description of media evolution and then defines and compares online and offline marketing. The part that describes Facebook marketing starts with its history, followed by the creation of marketing strategy and ends with a description of performance measurement methods. The second practical part starts with a situation and SWOT analyses of a given company, followed by marketing campaign plan and best practices for e-commerce Facebook advertising. Rest of the thesis contains a description of the campaign launch, its evaluation, and suggestions for future research. Anotace Předmětem této práce je Facebook marketing a jeho aplikace v podobě reklamní kampaně. Práce je rozdělena do dvou částí, teoretické a praktické. Teoretická část začíná popisem vývoje médií a poté definuje a porovnává online a offline marketing. Část týkající se Facebook marketingu nejdříve popisuje jeho historii, poté rozebírá tvorbu marketingové strategie a končí popisem metod měření výkonu. V praktické části je nejdříve provedena situační a SWOT analýza, poté následuje plán reklamní kampaně a výčet nejlepší taktik pro Facebook e- commerce propagaci. Zbytek práce obsahuje popis spuštění a vyhodnocení kampaně a navrhuje potenciální budoucí výzkum. Keywords Facebook, Advertising, Marketing, Strategy, Social Networks, E-commerce Klíčová slova Facebook, reklama, marketing, strategie, sociální sítě, e-commerce
Declaration
I declare that I wrote this bachelor’s thesis “Facebook Marketing and Campaigns of a Given
Company” on my own, under the supervision of Ing. Dušan Mladenović, and that I cited all
used literature and other scholarly sources in accordance with legislation, internal regulations
of Masaryk University and internal acts of Masaryk University and Faculty of Economics and
Administration.
In Brno on November 15, 2017 _______________________
Author’s signature
Acknowledgement I would like to thank my supervisor Ing. Dušan Mladenović for his guidance and advice on my thesis. Additionally, I give many thanks to my brother and parents for their patience and support.
Table of Contents
Introduction ............................................................................................................................ 11
1 The evolution of media .................................................................................................. 13
1.1 The old media ...................................................................................................................... 13
1.1.1 Newspapers ...................................................................................................................... 13
1.1.2 Radio and TV ................................................................................................................... 13
1.2 The new media .................................................................................................................... 14
1.2.1 Web 1.0 ............................................................................................................................ 14
1.2.2 Web 2.0 ............................................................................................................................ 14
1.2.3 Web 3.0 ............................................................................................................................ 15
1.3 Social Networking Sites ...................................................................................................... 15
2 Marketing principles ..................................................................................................... 19
2.1 Marketing Definition .......................................................................................................... 19
2.2 Online Marketing Definition ............................................................................................. 19
2.3 Differences between Offline and Online Marketing........................................................ 20
2.4 Online Marketing Framework .......................................................................................... 23
2.4.1 Content Strategy ............................................................................................................... 24
2.4.2 Communication Strategy.................................................................................................. 25
2.4.3 Measurement strategy ...................................................................................................... 26
3 Facebook Marketing ...................................................................................................... 27
3.1 Introduction to Facebook .................................................................................................. 27
3.1.1 History of Facebook ......................................................................................................... 27
3.1.2 Facebook’s approach to social networks ......................................................................... 28
3.1.3 Facebook success factors ................................................................................................. 29
3.1.4 History of Facebook Ads ................................................................................................. 29
3.2 Facebook Marketing Strategy ................................................................................................ 30
3.2.1 Situation analysis ............................................................................................................. 30
3.2.2 SWOT Analysis ............................................................................................................... 33
3.3 Facebook advertising ......................................................................................................... 34
3.3.1 Facebook Page ................................................................................................................. 34
3.3.2 Business Manager ............................................................................................................ 35
3.4 Performance Measurement ............................................................................................... 37
3.4.1 Google Analytics Metrics ................................................................................................ 37
3.4.2 Facebook Ads Metrics ..................................................................................................... 38
4 Introduction of the Company ....................................................................................... 39
4.1 PROTECT CZ s.r.o. ........................................................................................................... 39
4.2 Situation analysis ................................................................................................................ 39
4.2.1 Business ........................................................................................................................... 39
4.2.2 Competitors ...................................................................................................................... 40
4.2.3 Customers......................................................................................................................... 41
4.2.4 Goals ................................................................................................................................ 43
4.2.5 Key Performance Indicators............................................................................................. 43
4.3 SWOT Analysis ............................................................................................................... 44
5 Facebook Advertising Plan ........................................................................................... 44
5.1 Best practices for e-commerce Facebook advertising ..................................................... 45
5.1.1 Facebook Pixel ................................................................................................................. 45
5.1.2 Product Feed .................................................................................................................... 46
5.1.3 Campaign Objectives ....................................................................................................... 47
5.1.4 Audiences ......................................................................................................................... 48
5.1.5 Bidding and Optimization ................................................................................................ 49
5.1.6 Ad Formats and Placements ............................................................................................. 50
6 Campaign Launch and Evaluation .............................................................................. 51
6.1 Traffic Campaign ............................................................................................................... 52
6.2 Conversion Campaign ........................................................................................................ 54
6.3 Overall Evaluation ............................................................................................................. 55
7 Discussion ....................................................................................................................... 56
Conclusion .............................................................................................................................. 57Introduction
Since its launch in 2004, Facebook has been steadily growing and became one of the biggest
and most influential available platforms for online advertising. Despite the ever-increasing
number of new advertisers and marketers, there is still remarkable number of businesses not
using this platform as an advertising channel. Meaning, there is still opportunity for smaller
companies to effectively communicate their competitive advantage and reach their target
audience. Originally, advertising on Facebook was built especially for ecommerce websites that
sell to end customers and should serve as a “discovery” for the user and ideally feel as a useful.
The objectives of the thesis
The final objective of this thesis is to plan, launch and evaluate a real-time Facebook advertising
campaign for the e-shop of the company PROTECT CZ s.r.o. Additional goals are to analyze
marketing situation of the company and align Facebook advertising campaign with business
goals.
Generally, the work is being divided into two parts, theoretical and practical. The first part will
be a theoretical one and it starts rather broadly and becomes more concrete in its continuation.
It starts by describing the historical evolution and development of media, then it defines and
compares online and offline marketing. The chapter that deals with Facebook marketing starts
with history of this social network, followed by creation of marketing strategy and ends with
description of performance measurement methods.
The second part consists of following: introduction to the company, its situation and SWOT
analysis, advertising campaign plan and its launch, and evaluation of collected results.
Research goal of this thesis is to formulate both theoretical and practical approach to creation
and evaluation of e-commerce Facebook advertising campaign.
The main research questions are:
1. What are the best Facebook marketing practices for an e-shop?
2. How paid Facebook campaigns influenced revenue and profits of the target e-shop?
Methodology
The first part of the thesis is supported mostly by secondary data from e-books, website articles,
papers, and also from Facebook itself. However, the author had to use mostly website articles
due to the fact that the latest published books about Facebook marketing were from 2015 and
were already out-of-date.
The sources for the second, practical part of the thesis are of both secondary and primary origin.
Data acquired for the situation and SWOT analyses is mostly from company’s internal systems,
competition analysis, and third-party systems like Facebook Ads and Google Analytics.
Primary data from the campaigns will be acquired by testing of different target audiences, ads
and ad placements. The final performance analysis was performed on exported .csv files in
excel and visualized in the form of graphs and tables.
11The campaign itself consisted of two parts: traffic acquisition and conversion. It ran for two
weeks and spent CZK 10,000. The traffic campaign was slightly profitable and the conversion
campaign was a net loss. Overall, the campaign wasn’t profitable but provided important
insights on what to improve and focus on in the future.
121 The evolution of media
This chapter is going to deal with the historical development of media. Types of media were
changing relatively slowly in the past but in the last two decades a rapid development could
have been witnessed. Different media require different strategies and it is necessary to
distinguish between what worked in the past and what is needed today to reach target group.
Before delving into the details of such specialized discipline like Facebook advertising
undoubtedly is, it is necessary to see the bigger picture and look into the past and try to
understand what lead to this point.
1.1 The old media
This subchapter will revisit the most important changes in the forms of media, i.e. the ways
people tried to communicate, advertise and influence each other. The presented media will be
the ones that most stood out in the 19th and 20th century i.e. newspapers, radio and television
(Saltzman, 1999). The last one (TV) still being the most influential to this day.
1.1.1 Newspapers
The development of printing press in the 15th century is one of the most important milestones
in the world of advertisement and communication. It allowed marketers to reach wider
audiences than ever. The first newspaper advertisements appeared in England in the 17th century
and spread across the country and then across the globe. This was the beginning of the era of
mass communication and advertisement (Ryan and Jones, 2009).
At the turn of the 18th and 19th century, the mail-order advertising appeared along the classic
newspaper ads. The first advertising company Volney Palmer was established in 1843 and
gradually, as other competitors started sprouting, turned from selling newspaper space to a full-
service creative agency (Ryan and Jones, 2009).
1.1.2 Radio and TV
Television and radio emerged in the 20th century and became the first widely used electronic
media. As can be seen in the graph below, average daily hours spent watching TV have been
steadily increasing since the 1950s.
Figure 1: Average daily hours spent watching TV
Average daily hours spent watching TV
(per household)
10
8
Hours
6
4
2
0
1950 1960 1970 1980 1990 2000 2010
Source: (The Nielsen Company, 2009)
13The younger generations (Millennials and Generation Z) are surprisingly still watching TV, but
the trend is downward and it appears that most of the demographic is watching online rather
than via broadcast (Coughlan, 2016). Author has a first-hand experience of this trend as he and
his friends do not watch TV at all. According to analysis from MEC agency the trend is similar
in Central and Eastern Europe. Czech Republic has the highest decline (3%) in average daily
television viewing out of the whole region (MediaGuru, 2017).
The radio listening experience has changed and is nowadays shifting into the online sphere as
well. According to the Pew Research Center report from 2015, more than 50% of Americans
that are 12 and older tuned in to online radio in the previous month. The percentage of people
who listen to online radio has almost doubled from 27% to 53% in 2015 (Mitchell, 2015).
Advertising via online radio broadcast is effective especially in demographic group of 18 to 34-
year-olds as they prefer ad-supported radio to models based on subscription. However, it is
important to choose a relevant type of advert as three-quarters of listeners prefer to hear an
advertisement about products and services they are interested in (Troha, 2015).
1.2 The new media
The term new media started being used after the expansion of computer technology. According
to Manovich, the new media are “cultural objects which use digital computer technology for
distribution and exhibition.” That includes internet websites, videogames, virtual reality and
other (Manovich, 2003). The underlying technological base and backbone for today’s social
networks and online marketing is the internet. It is therefore important to distinguish the two
phases of development the Web went through in its history.
1.2.1 Web 1.0
The first phase of the internet evolution took place during 90’s and early 00’s and is nowadays
called the Web 1.0. Its main characteristic was a significant disproportion between content
creators and passive content consumers. The former were massively outnumbered by the latter.
Very common were personal static websites hosted on free web servers. Some features were
similar to the Web 2.0 e.g. guestbooks instead of comment sections. This was mainly due to
bandwidth limitations to prevent page slowing with long comment threads (Cormode and
Krishnamurthy, 2008).
1.2.2 Web 2.0
On the other hand, the second phase of the internet development, the Web 2.0, allowed people
to have personal profiles on websites such as Myspace and Facebook or to easily create their
own blogs via services like Blogger or Tumblr. According to Terry Flew the main difference
between Web 1.0 and 2.0 is the "move from personal websites to blogs and blog site
aggregation, from publishing to participation, from web content as the outcome of large up-
front investment to an ongoing and interactive process, and from content management systems
to links based on "tagging" website content using keywords." (Flew, 2014, p. 19)
The definitions are numerous but the main difference between the two is a shift from static web
pages created by the minority to massive amounts of user-generated content on social networks.
14Additional features of Web 2.0, that were not present in Web 1.0 sites, include:
- Prominence of profile pages that include information about age, sex and location
- Ability to create connections with other users via “friendships” or “groups”
- Ability to post content in many forms: photos, videos, blogs and comments
- Presence of public Application Programming Interfaces (APIs) that allow third parties
to modify and enhance accessed data
(Cormode and Krishnamurthy, 2008)
1.2.3 Web 3.0
The term Web 3.0 was coined by John Markoff in 2006 and could be defined as a “third
generation of Internet-based services that collectively comprise what might be called ‘the
intelligent Web’ — such as those using semantic web, microformats, natural language search,
data-mining, machine learning, recommendation agents, and artificial intelligence
technologies” (Spivack, 2007). Web 3.0 is also referred to as semantic web, however, Tim
Berners-Lee describes it as a component of Web 3.0. It is a web in higher resolution as every
piece of link between data is defined, giving more information and meaning to the link. The
final goal of semantic web is to have all human knowledge available in a machine-readable
form (Shannon, 2006; Helmond, 2008).
In connection with online marketing, Web 3.0 is being implemented in the e-commerce
industry by large corporations like Amazon and BestBuy. Amazon is already using users’
browsing history to recommend similar products and customize search results. The future
might look like that every user will have personal uniquely customized website offering only
products that are relevant (Tan, 2012).
1.3 Social Networking Sites
The backbone construct and the most important part of the, previously mentioned, Web 2.0 are
social networks or social network services (SNS).
The social network is a structure that consists of a finite number of actors and interactions
between them. According to Wassermann and Faust, the occurrence of relational information
is the most important and defining feature in the realm of social networks (Wasserman and
Faust, 1994).
The SNS are online platforms allowing people to create their own social networks and relations
with people who share similar interests, backgrounds and friends (Obar and Wildman, 2015).
Huge number of authors tends to define SNS in various ways. However, there are some
common features that are shared across the whole spectrum of definitions:
1. They are applications based on the internet
2. Their content is predominantly user-generated
3. Users have to create specific profiles to use the service
4. The service allows people to connect to other individuals or groups
(Kaplan and Haenlein, 2010)
15Figure 2: Number of social media users from 2010 to 2017
Number of social media users
worldwide from 2010 to 2017 (bn)
3
2,51
2,5 2,34
2,14
1,91
Users in billions
2
1,59
1,4
1,5 1,22
0,97
1
0,5
0
2010 2011 2012 2013 2014 2015 2016 2017
Source: (Statista, 2017)
As can be seen in Figure 2, the number of social media users has been steadily increasing and
is expected to increase at a similar pace in the future. In 2016 68,3% of internet users were
active on at least one social network. Social media is especially popular in the USA with a
penetration rate of 59 %. Overall U.S. users spend more than 216 minutes per week on social
media vie smartphone. Number of social media users in the Czech Republic is lower. Some
45% of adults are registered at least at one social network, 63% of the registered users use
smartphone for communication on social media and 45% of social media users are registered
on Facebook. This makes Facebook the first network by number of users (Fokus, 2016).
Figure 3: Number of active social media users as of January 2017
Number of active social media
users as of January 2017
2000 1871
1800
1600
Users in millions
1400
1200 1000 1000
1000
800 600 550
600
317 300
400 150 106 90
200
0
Source: (Statista, 2017)
16Figure 3 shows that the largest social network and the first one that surpassed one billion users
is Facebook. It is somewhat interesting that in the second and third places are no longer social
networking sites like Instagram and Twitter, but rather messaging apps like WhatsApp and
Facebook Messenger. This trend has been developing for the last four years and is mainly
attributed to the youngest generation, which started to move from classical social networks to
aforementioned messaging apps (Olson, 2013).
The trends visible from the graphs show that social media and networks are becoming
increasingly larger part of our daily settings. There are several opinions about this development
and its consequential usefulness or risks. Ranging from one extreme by Manfred Spitzer (2012)
who claims that digital media threatens our civilization and that we are “clicking away our
sanity” to the fully opposite attitude of Kenneth Goldsmith (2016) who argues that internet
allows us to express our creativity more than any other media in the past and therefore is the
ultimate good.
Even though author likes Goldsmith’s cheerful acceptance of the Internet and social media, he
is aware of the potential risks of mental illnesses that can be induced by the skewed view of
reality that Facebook and other social media often present (Hurst, 2015).
1718
2 Marketing principles
This chapter will define what the terms marketing and online marketing mean, compare those
two and show current trends in this field. The last subchapter will deal with the marketing
framework from Avinash Kaushik called See Think Do Care.
2.1 Marketing Definition
There are several definitions of marketing and their main difference lies in their breadth. The
modern and broadly accepted definition approved by American Marketing Association in 2013
describes marketing as: “the activity, set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have value for customers, clients,
partners, and society at large.” (American Marketing Association, 2013)
Other notable contribution from Chartered Institute of Marketing defines it as “the management
process responsible for identifying, anticipating and satisfying customer requirements
profitably.” (The Chartered Institute of Marketing, 2015)
According to well-known expert and author of marketing bible, Philip Kotler, marketing is “an
organizational function and a set of processes for creating, communicating, and delivering
value to customers and for managing customer relationships in ways that benefit the
organization and its stakeholders.”(Kotler and Keller, 2012, p. 28)
2.2 Online Marketing Definition
In the beginning of this subchapter, it is necessary to differentiate between online and digital
marketing. Digital marketing is a broader term as it describes channels beyond internet
marketing. Among exclusively online channels like social media, display, search engines it
includes other digital media like mobile phones, television, and radio. (Financial Times
Lexicon, 2017) Alex Chris in his comparison of digital marketing and social media uses
diagram that demonstrates the main differences between digital and internet marketing.
Figure 4: Difference between digital and internet marketing
Source: (Chris, 2015)
19According to Kabani and Brogan (2012), the online marketing is a way of leveraging the
Internet by conveying a message in order to move people to take action. Other definition by
Beal (2017) claims that online marketing “refers to advertising and marketing efforts that use
the Web and email to drive direct sales via electronic commerce, in addition to sales leads from
websites or emails.”
The most widely used online marketing channels, according to Fishkin (2009), are as follows:
- Website itself
- Social Media Marketing
- E-mail marketing
- Search Engine Marketing – including pay-per-click advertising (PPC) and search engine
optimization (SEO)
- Display Advertising
- Online Public Relations
- Affiliate Marketing
- Conversion Rate Optimization
- Social Media Marketing
2.3 Differences between Offline and Online Marketing
The increasingly faster internet connection in the last 20 years allowed an access to nearly
unlimited amounts of information. This process changed the way users consume and companies
produce ad content.
The traditional advertising channels mentioned in the first chapter are currently all in decline.
That includes print, television, and radio. However, in the past those were the channels that
were necessary to succeed in conveying the message effectively.
Kabani and Brogan (2012) state three main differentiating factors of new and old media:
1. The old media were one one-way channel. It was not possible to easily react to the
advertisement and to express and share opinion.
2. Simpler targeting. The target audience was more homogenous, that includes people’s
interests, purchasing habits and opinions.
3. Absence of information overload and distrust in media. People were less exposed to
information stream than today and trusted mainstream media more.
The shift from conventional to digital media is significant and changes the focus of entire
advertising industry. As can be seen in the graph below, there is a visible downward trend in
consumer media consumption share of the old media (TV, Radio, Print).
20Figure 5: US Consumer Media Consumption Share
US Consumer Media Consuption Share
60
46 49
50 42 41 40 39 42
38 37 36 39
Percentage
40 32
30
17 15 14
20 13 12 11
9 8 7
10 5 4 4
0
TV Digital Radio Print
2009 2010 2011 2012 2013 2014
Source: (eMarketer, 2014)
However, after breaking down the “digital” segment by device, the downward trend is visible
in desktop as well. The only upwards trend is present in mobile, which has attained the second
biggest audience.
Figure 6: US Consumer Media Consumption Share
US Consumer Media Consuption Share
50 45
40 37
Percentage Share
30 25
23
18 17
20
11
9
7
10 4 4 2
0
TV Desktop Radio Mobile Print Other
2009 2010 2011 2012 2013 2014
Source: (eMarketer, 2014)
The changes in the industry also put pressure on marketing professionals. According to 76% of
marketers, the whole field has changed more in the past two years than in the past 50. The
application of the traditional methodology of marketing does not always work and it is therefore
necessary for classically trained marketers to adapt and broaden their portfolio of skills to
include digital as well (Adobe, 2013).
Hand in hand with this trend go changes in company marketing spending allocation. The trend
of increasing spending in internet advertising is visible while spending in other channels is
either diminishing or stagnant (Print, Radio, Outdoor). The only exception are investments in
TV advertising, which have been rising in the last four years.
21Figure 7: Distribution of advertising spending in the Czech Republic
Distribution of advertising spending
in the Czech Republic
100 5,4
5,9 5,9 6,3 6,5 6,5 6,2 5,6
6,5 2,2 1,8 1,7
90 8,4 8,1 8 7,5
80 27,6
36,3 31,3 22,4 20,4
29,8 25,9 24
70
60
50
44,5 45,4
40 47 40 41,8
46,8
47,2 43,1
30
20
10 17,4 19,2 19,6 18,9 21,1
10,6 13 14,2
0
2009 2010 2011 2012 2013 2014 2015 2016
Internet TV Print Radio Outdoor
Source: (SPIR, 2017)
According to a Gartner survey, in 2016 marketing leaders spent more on websites, digital
commerce, and digital advertising than on other categories in 2016. Even though ad blocking
is one of the main concerns of online advertising, 65% of leading companies are planning to
increase their digital advertising budget in 2017 (Pemberton, 2016).
Following three are the main factors of the budget increases:
- Shift from offline to digital advertising
- Decline of organic social media reach in favor of paid
- Higher cost of video advertising, which is gaining importance and is effective
(Pemberton, 2016)
As previously mentioned, one of the problems of online advertising is the use of ad blockers.
About 11% of the Czech internet population uses ad blocking tools, however, this phenomenon
is more present among tech-savvy users e.g., male college students (Krupka, 2015). This means
that author's campaigns might be less influenced as the target group consists mostly of middle-
aged, blue-collar workers.
Even though the priorities and focus are switching from traditional to digital marketing, it is
crucial to balance the marketing mix appropriately and make sure that digital advertising
conforms to the same measurement standards as other marketing investments.
222.4 Online Marketing Framework
Well known online marketing framework called See, Think, Do, Care (STDC) was presented
by Avinash Kaushik in 2013. Kaushik built this framework because he considered the
traditional AIDA (Attention, Interest, Desire, Action) marketing model insufficient for
capturing the complexities and measurements of online marketing. His goal was to create
customer-centric framework with holistic evaluation of online marketing activities. As the
acronym suggests, the model consists of four parts: See, Think, Do, and Care. Additionally, the
framework is split into two dimensions: Consideration Stage and Audience (Kaushik, 2013).
Figure 8: STDC Framework
Source: (Kaushik, 2015)
Kaushik’s framework is similar to the concept of a conversion or sales funnel. According to
Jansen, the funnel is “a staged process that consumer takes in order to purchase a product or
sevice.” The funnel can be divided into three parts: top, middle and bottom of the funnel
(TOFU, MOFU, BOFU) (Jansen and Schuster, 2011, p. 2). The consideration stage describes
in which part of the conversion funnel is the member of the audience. To demonstrate the
framework an example of an e-shop that sells clothes is given.
SEE DO
In the See stage, the target audience is the DO stage consists of people who are
largest addressable qualified audience. In relevant to the business and manifest a large
case of clothing e-shop that is everyone who purchase intent. E.g. people who wear
wears clothes. clothes, think that might need some new and
are actively looking to buy them.
THINK CARE
The Think stage includes only people from Care stage contains people who bought
See audience that have some intent to from the business more than twice. They are
purchase. That means the people who wear the people who are brand ambassadors and
clothes and think that might need some new spread word of mouth. This audience
ones. should have its own STDC strategy.
23The approach of this framework provides a perspective to all online activities and helps to solve
following three problems:
1. Identify gaps in web marketing strategy
2. Reflect whether are advertising activities broad and optimized enough for each
consideration stage
3. Measure effectiveness of each stage according to its position in the funnel
The workings of STDC Framework could be divided into three strategies:
1. Content Strategy
2. Communication Strategy
3. Measurement Strategy
All three strategies are going to be used in the second part of the thesis on real-time Facebook
campaigns. Content strategy will influence the type of content presented to customer in
advertisements. Communication strategy will help to decide how will advertising claims change
according to campaign (branding, traffic acquisition, remarketing). Finally, the measurement
strategy approach will determine which metrics to focus on when evaluating the mentioned
types of campaigns.
2.4.1 Content Strategy
Content strategy is the part of marketing plan that deals with any type of media that is created
for advertising purposes (either written or visual) (McGill, 2017). Content created for the
campaign in this thesis will consist solely of ads. In addition to product images (which are
predetermined), the ad will contain promotional text (copy).
One of the important factors in copywriting is understanding the difference between features
and benefits. Feature is some inherent quality of a product whereas benefit is what can customer
accomplish with the product (Shewan, 2017).
Carter (2012) claims that it is always better to talk about benefits than features and to talk about
dreams than benefits. He demonstrates the main differences it in the figure below:
Figure 9: Features, Benefits, and Dreams
Source: (Carter, 2012)
To find out what customer dreams about it is useful to think of all the features and benefits the
product offers.
242.4.2 Communication Strategy
According to Nordquist (2017), communication is “the process of sending and receiving
messages through verbal or nonverbal means including speech or oral communication, writing
or written communication, signs, signals, and behavior.” Marketing communication strategy
defines the company’s plan how to distribute information and develop brand awareness.
Components of online marketing communication strategy might include individual advertising
channels including display, SEO, PPC and Social (Greene, 2011).
When buying advertising space, it is necessary to determine which audience in which stage is
being targeted. The creative of the ad has to shift from broad to narrow as the focus shifts from
SEE through THINK to DO stage (Kaushik, 2013).
The initial marketing focus distribution across all consideration stages might look as follows:
Figure 10: STD Marketing Focus
Source: (Kaushik, 2013)
However, when thinking about the distribution of channels across all stages more deeply, it
starts to appear that some of the channels can be used almost in every step of the customer’s
consideration stage. Eventually, the layout of marketing channels could look like this:
Figure 11: STD Complex Marketing Focus
Source: (Kaushik, 2013)
25It should definitely be adjusted according to the industry and the type of sector (B2C or B2B),
but the general process of its creation is same across all businesses. The main difference
between B2C and B2B communication is that in former, marketer communicates to an
individual whereas in the latter, there are multiple addressees of the marketing message
(Donaldson, 2008).
2.4.3 Measurement strategy
The problem of utilization of only DO stage and omitting using channels in previous two stages
is according to Kaushik mainly caused by an excess focus on the bottom of the funnel (BOFU)
metrics like conversion rate and profitability. When judging SEE and THINK stages by these
metrics, it turns out that they do not work (do not bring in any money).
The pitfall of this thinking lies in the fact that members of audiences in the first two stages are
not ready to convert yet, so it does not make sense to measure the effectiveness of SEE an
THINK stage with DO stage key metrics.
The solution to this problem is relatively simple. In order to properly measure the performance
of each stage, it is necessary to choose metrics that match the goals of each stage. As can be
seen in the following image, for SEE stage it could be metrics like percentage of new visits or
number of interactions. In the THINK stage the metrics get more concrete, like click-through
rate and page depth. Eventually, the last DO stage contains metrics that most marketers already
focus enough on: conversion rate, profit and ROI. However, the author thinks that if SEE or
THINK phases bring in results (conversions), it is appropriate to apply DO stage metrics to
them as well.
Figure 12: STD Stage Metrics
Source: (Kaushik, 2013)
By combining all three strategies of the STDC framework, the marketing efforts should target
each customer with appropriate ads and according to respective consideration stage. It should
properly measure performance thanks to relevant metrics and evaluate the effectiveness of the
whole strategy and campaign.
263 Facebook Marketing
This chapter will start with history of Facebook and Facebook advertising, and then will
describe the process of strategy creation. The second half will deal with technical prerequisites
for advertising on this platform and also with measurement of acquired results.
There are three main reasons why Facebook is going to be utilized for advertising of the
company in the second part of the thesis
1. Its large user base
2. Advanced targeting possibilities
3. Small number of company’s competitors using Facebook as an advertising channel.
3.1 Introduction to Facebook
As demonstrated in Figure 3 in the first chapter, Facebook is the largest social network by the
number of active users. This subchapter will explore the history of Facebook and reasons that
led to its extreme success.
3.1.1 History of Facebook
The basic concept of Facebook was quite simple. Its main goal was to help users keep in touch
with their relatives, friends, and acquaintances and allow them to share information, photos and
video with them. Everything as quickly and easily as possible. Additional features were
gradually included but the fundamental idea remained the same.
Mark Elliot Zuckerberg launched Facebook (formerly called “thefacebook”) in February 4
2004, when he was 19 years old and was attending Harvard University. The initial idea was to
connect Harvard students with each other. The Facebook quickly spread to other universities
and Zuckerberg partnered up with three other students. The growth was so fast that Mark
decided to drop out of Harvard and focus fully on development (Landsverk, 2015).
In September 2004 Facebook had more than two hundred thousand users and by the end of the
year, the number exceeded one million. 2006 was the year in which Facebook became open for
everyone older than 13 years. In 2008 the number of monthly active users broke the 100 million
mark and from that point growth became faster than ever.
Figure 13: Number of monthly Facebook active users
Number of monthly Facebook active users
2000
Users in millions
1500
1000
500
0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Source: (Statista, 2017)
273.1.2 Facebook’s approach to social networks
As mentioned in the first chapter, Facebook’s main goal, like of every other social network, is
to create and sustain connections between its users.
To start using Facebook it is necessary Figure 14: Facebook Signup Page
to register first. This means filling out a
name, surname, email address or phone
number, password, birthday and gender.
After signup, it is possible to quickly
connect with friends and acquaintances
via import of contacts or email list.
The user’s profile page is built around
the information provided in signup and
additional data that can be filled out
later. This most prominent information
includes user’s profile picture, cover
photo, hometown, hobbies and
numerous other like religious or political beliefs. Source: Facebook.com
The user’s name and profile picture is the most important component because it is used for
search and identification. Privacy settings are available for almost all of the user provided
information except for the name, profile picture and cover photo, which are always public.
The first important Facebook feature called “News Feed” was announced in 2006 and it allowed
users to see on their homepage all the new information and changes their friends, pages or
groups they followed. In 2011 Facebook revealed at the f8 developer conference a new feature
called Timeline. It replaced the previous “wall” and offered a chronological feed of content
generated by users such as statuses, photos, events and mobile apps interactions (Schulman,
2011).
The most iconic feature of Facebook, the “like” button was first enabled in early 2009 (Kincaid,
2009). It allowed users to quickly interact with statuses, comments, photos, links, and ads. The
feature was extended to comments in 2010. In 2016 the Facebook launched “Reactions” feature
that let people express their opinion via five predefined emotions "Love", "Haha", "Wow",
"Sad", or "Angry" (Stinson, 2016).
Besides commenting a liking one of the most prominent features of Facebook is its Messenger
(originally Facebook Chat). The Messenger was initially part of the mobile application but was
later in 2011 launched as a standalone app for iOS and Android (Kincaid, 2011). In 2015 the
website version of Messenger was released available at messenger.com (Welch, 2015).
283.1.3 Facebook success factors
As it could have been seen in Figure 13 the Facebook’s growth since 2008 has been rock-steady.
It outran every other social network platform including Myspace, Twitter and Google+.
The first reason is definitely the approachable user interface and its accent on usability in
general. It is purposely designed that even 14 year olds quickly grasp how to use the application.
Besides providing a communication platform to connect with other users, Facebook also serves
as quick source of information and eventually bypasses the typical style of news consumption.
Regarding media consumption, a wide offer of entertainment on Facebook platform including
games, videos and funny pictures that keep people hooked (Rao, 2015).
There are two important success factors according to Haydon. The first one is the media
coverage that Facebook receives on a daily basis ranging from security scandals to emotional
stories about reunion of lost siblings. The second one is Facebook’s clever utilization of its
existing user base to acquire additional users. It has been done by motivating users to invite
their friends and acquaintances via email contacts import (Haydon, 2015).
Besides serving as a tool for making connections and media consumption, important factors of
Facebook’s success were absence of similar competition, absence of adult content and emphasis
on high level of security (Rao, 2015).
3.1.4 History of Facebook Ads
One of the important success factors for Facebook was introduction of advertising platform in
2007. It allowed users to create Facebook Page to advertise on its behalf. Advertisement
targeting possibilities were further expanded in 2009 when Facebook introduced geographical
and language based targeting.
Introduction of Power Editor in 2011 and Facebook Exchange (FBX) transformed Facebook
into powerful platform similar to Google AdWords (Des, 2017). Power Editor is a tool that
allows bulk edits, filtering and performance tracking. FBX was a first version of Facebook
retargeting and was shut down in 2016 and replaced by Facebook Audience Network that
allowed to advertise on website outside of Facebook (Meola, 2016).
Launch of Lookalike Audiences in 2013 allowed marketers to create larger similar audience
out of a smaller source audience in chosen country. Conversion Pixel and Website Custom
Audience pixel released in 2013 were merged into one Facebook Pixel in 2015 that combined
features of both previous solutions (conversion tracking and visitor tracking) (Vahl, 2015).
Carousel Ads format introduced in 2014 showcased multiple products in one ad. Carousel
evolved into Dynamic Product Ads in 2015, that allowed retargeting and showing multiple
products that user visited on advertiser’s website. The most important releases of 2016
Facebook Ads for Messenger (Des, 2017).
293.2 Facebook Marketing Strategy
To effectively launch a marketing campaign, it is necessary to have a strategy. This is what will
be discussed in this chapter including situation analysis, goal setting and eventually the ins and
outs of Facebook marketing and advertising.
3.2.1 Situation analysis
The perfect recipe for crafting marketing strategy does not exist. It is because each business is
unique and it means that each marketing strategy has to be uniquely crafted as well. Each
business has to sell different product(s), operates in different markets and fulfils different
customer needs with different competitors influencing their moves. The most qualified people
to create the strategy are the ones who see the company holistically and are able to synthesize
knowledge from multiple sources.
Five foundational pillars of knowledge have to be established to create a solid marketing
strategy. According to Ryan and Jones (2009) those are following:
1. Knowledge of business
2. Knowledge of competitors
3. Knowledge of customers
4. Knowledge of goals
5. Knowledge of Key Performance Indicators
Knowledge of business
The first factor is to know whether business is ready and able to utilize online marketing. The
two main questions to ask in this matter are whether is the target audience online and whether
are offered products or services suitable for online promotion (Ryan and Jones, 2009).
The second factor is financial and human resources. The allocated resources will differ
according to a size of the company and the needed amount of human resources to launch and
run campaign. Main resources are budget, staff and technological infrastructure (Carter, 2012).
The third factor is understanding of how will online marketing be integrated into existing
business processes. Determine how will these processes need to adapt, and ensure that business
and its staff is ready to embrace new changes (Ryan and Jones, 2009).
Knowledge of competitors
When entering the realms of online marketing the scope of competition increases significantly.
The same online technologies that allow one business to reach people in the whole country or
even around the world are available to its competitors as well. Knowledge of competitors allows
to understand their strategies, reveal weak spots and turn them into own advantage.
To start it is important to ask following questions:
- Who are the competitors in the online marketplace?
- How do they differ from current offline competitors?
- What are their current activities in the online advertising space?
(Ryan and Jones, 2009)
30Knowledge of customers
For a company that has been in business for some time it should not be difficult to determine
its typical customer. It is now easier than ever with the help of Facebook’s feature audience
insight that allows to analyze demographics of current customers or website visitors.
In case the company is new, no matter whether it is a local business or aspiring global start-up,
it is necessary to acquire knowledge about potential customers.
There are several questions to ask while trying to understand customers:
- Is the target group the same both online and offline?
- How are the customers using digital technology?
- What are interests of the target group?
- What is their level of education?
- Are they married, dating or single?
- In what age group are they and what is their gender?
(Ryan and Jones, 2009; Carter, 2012)
It is often not possible to answer all the questions, but in the beginning, it is enough to create a
prototype of persona and subsequently refine the idea according to the data about the acquired
customers.
To define an “ideal customer” or persona, Brian Tracy recommends clarifying following:
- Benefits customer is looking for in a product
- Location of the customer
- Time when the customer buys
- Customer’s buying strategy
(Tracy, 2005)
Knowledge of goals
After understanding business and getting to know customers and competitors, it is crucial to
define what the expected gains of the advertising activities. That means setting clear,
measurable and achievable goals. Businesses can choose from several goals, ranging from lead
generation, increasing awareness or engagement, and generating online sales. All goals have
eventually the same end goal: to increase the company’s profit.
Facebook differentiates its advertising objectives (goals) into three categories according to the
purchasing stage of customer: Awareness, Consideration, and Conversion.
Figure 15: Facebook marketing objectives
Source: Facebook
31Awareness
This group of objective aim to generate interest in offered product or service. It contains goals
“Brand awareness” and “Reach”
Consideration
Objectives in this category are meant to make people thinking about business and start
researching. The objectives range from driving traffic, lead generation to acquiring page likes.
Conversions
The last class of objectives contains actions in the bottom of the funnel that means conversions
e.g., leads, registrations, and purchases. (Facebook, 2017)
When setting goals, it is useful to use SMART method. SMART is an acronym consisting of
five criteria that should objective meet:
- Specific – targeting a specific area for improvement
- Measurable – quantifying or suggesting indicator of progress
- Assignable – specifying who will carry it out
- Realistic – stating whether results can be realistically achieved
- Time-related– defining a point of time when goals should be reached
(Doran, 1981)
Knowledge of Key Performance Indicators
According to Reh (2017), Key Performance Indicators (KPIs) are metrics that evaluate the rate
of success of a specific activity that company engages in. One of the main factors that
differentiates online marketing from offline is measurability (Visser, 2017). In online
campaigns virtually everything that happens can be tracked. That includes how people react to
ad, how it performs and eventually whether it fulfils its end goal. The KPIs should answer
following questions:
- How is the campaign progressing?
- Which channels are performing better than others and why?
- What are the campaign’s conversion rates?
- What percentage of acquired traffic resulted in valuable actions?
(Ryan and Jones, 2009)
More specific metrics and measurements available on Facebook and Google Analytics are
going to be discussed in the subchapter 3.4.
323.2.2 SWOT Analysis
Analysis of company’s strengths, weaknesses, opportunities, and threats (SWOT) is often used
method in situation analysis. Two main marketing environments are monitored: external and
internal. Those are located on the Y axis and contain strengths and weaknesses (internal) and
opportunities and threats (external). X axis segments the diagram into two parts according to
influence of the environment: either helpful (S, O) or harmful (W, T). To carry out the analysis,
it is necessary to fill out each quadrant with respective business insights (Kotler and Keller,
2012).
Figure 16: SWOT Diagram
Source: (Teknoswitch, 2017)
After performing the analysis, goals and strategies can be formulated. Goals should ideally meet
the previously mentioned SMART criteria. Michael Porter proposed three generic strategies
that provide good starting point for strategic thinking:
Overall cost leadership
Business tries to achieve lowest production and distribution costs.
Differentiation
Business concentrates on important customer benefit.
Focus
Business focuses on one narrow marketing segment.
(Porter, 1988)
Another way of using SWOT analysis output is called Matching and Converting. It is a
method of finding competitive advantages via matching Strengths with Opportunities and
converting Weaknesses or Threats into Strengths or Opportunities. In case conversion is not
possible, the goal is to minimize or avoid the negative impact of threats/weaknesses (Grimes,
2012).
333.3 Facebook advertising
When a comprehensive and clear strategy is formed it is necessary to develop more profound
details and specifics considering Facebook environment. This subchapter is going to describe
the essentials for advertising on Facebook namely Facebook page and Business manager.
Without these prerequisites, it is not possible to start any advertising or communication
campaign. Furthermore, features like Facebook Pixel and XML feed that enhance the
possibilities of advertising on this platform will be mentioned in the practical part of the thesis.
3.3.1 Facebook Page
The first prerequisite for advertising on Facebook is Facebook Page, which is “a public profile
specifically created for businesses, brands, celebrities, causes, and other organizations.”
(TechTarget, 2012). The process of its creation is relatively straightforward and most people
will have no problem with it. To create the page it is necessary to have a Facebook profile.
There are two options for creating the page: either from Facebook homepage before logging
(right below the “Create Account“ button) or from the footer of News Feed in both right and
left columns (Landsverk, 2015).
There are six types of pages that can be chosen from according to type of business or
organization:
- Local Business or Place
- Company, Organization or Institution
- Brand or Product
- Artist, Band or Public Figure
- Entertainment
- Cause or Community
Figure 17: Facebook Page Creation
Source: Facebook
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