6 Things You Need To Know About Facebook Exchange

Attention Facebook Advertisers! The Facebook Exchange has arrived.

Some of the more prominent statistics show higher click-through rates (CTR) while maintaing a significantly lower cost per click-through order (CPA). Basically, this means you’ll spend less money while more people to click your ads. Let’s take a closer look at just what the Facebook Exchange actually is.

The Facebook Ad Exchange

Facebook Exchange (FBX) was opened up in June 2012 to a select group of retargeting companies. These 8 companies and their clients were admitted to a secret beta test of FBX and the results of this beta test were kept secret until September 13, 2012.

Triggit and TellApart were some of the first companies to release their results, and offer some positive and negative feedback to the exchange. Before we cover the pro’s, con’s, and results, it is important to understand how FBX works.

What Facebook Exchange Does

Source: tellapart.com

FBX allows businesses to retarget ads to potential customers that have visited their website. For instance, if a visitor goes to your website looking to purchase a hammock (I may have purchased one recently!) but doesn’t actually buy it, the next time they go to Facebook your hammock ads are displayed on the right! That is the purpose of retargeting – to show relavent ads to potential customers that expressed an intent to buy.

With FBX, marketers run a Real-Time Bidding (RTB) campaign through a retargeting company. These sort of RTB systems are already being used today with Google’s DoubleClick Ad Exchange and Yahoo’s Right Media, so some advertisers should already have a feel for this sort of advertising. What FBX brings to the table is the staggering amount of users that use Facebook multiple times a day, and has yielded some impressive results for some companies in the trial run.

Facebook Exchange Results

While not every company has released specific data from the beta test of FBX, they have provided some statements and numbers comparing it to other ad campaigns. Here is a list of what some of the companies have said about FBX:

  • AdRoll‘s clients like GoPro, HootSuite, and Room & Board, a retail furniture store, were able to see some dramatic results. On average, AdRoll clients saw an increase in ROI of 16x.
  • Optim.al did not release any specific data, but their CEO Rob Leathern had this to say about FBX: “Optim.al recently helped a major financial services company double its fan base in two weeks, at a lower cost-per-fan than they had ever achieved before.” You can read more about this, and Optim.al’s new FBX integration in this Bloomberg article.
  • TellApart reported that their clients averaged a click-through rate of 6.65% on FBX, compared to the 6.41% CTR of their Google campaigns. One of their clients in particular, OnineShoes.com, yielded an eye-popping CTR of 15%.
  • DataXu‘s blog did not have any specific numbers to share with us, but their CEO Mike Baker said, “The initial results we’ve seen in customer campaigns are very positive, particularly around customer-acquisition efforts. FBX fundamentally changes the digital marketing game. It enables brands to win with data by using their own proprietary data and analytics to get even more value from Facebook’s large, engaged Internet audience. This is a milestone for brands: They can gain market share by leapfrogging competitors by extending highly targeted advertising to Facebook Exchange.”
  • Triggit shared this infographic displaying the success their clients have had with FBX. Some of their clients, like Shutterfly and Surveymonkey, experienced 4x click-through ROA’s, 2.2x CTR, and a conversion boost of 18% – 30% when compared to non-FBX campaigns. Also, all of this was achieved while decreasing their CPA by 6.5x. More conversions for less money

Expectations Of Facebook Exchange

One thing you can be sure of is people seeing your ads. Facebook is the #1 website worldwide for a reason – everybody (alright, 1 in 7) is on Facebook right now! The ability to target potential customers with relevant ads after they have already expressed an intent to buy should convert much higher than a cold lead. Should you jump on the FBX bandwagon just yet? Unless you’re a business willing to part with some cash for a trial-and-error campaign, I would say no.

FBX sounds great. What is lacking are solid numbers and examples of clients that have tried and succeeded or failed with their campaigns. Sure,we have several CEO’s spouting high praise for FBX, but they own the DSP companies, and could be prone to bias.

If you want to learn about proven Facebook advertising, let us teach you how to be successful with the Facebook Ads Academy. Facebook ads are our specialty – it’s actually how we became a profitable business!

Potential Facebook Exchange Pitfalls

There certainly has been a lot of pomp and parade about FBX. I was, however, able to dig up some shortcomings that may be cause for concern.

  • Ads only show up on desktop devices. No mobile support has been implemented yet.
  • Ad boxes may be too small to convey a marketing message. Other retargeting campaigns, Google for example, allows a wide variety of sizes for ads. These include various sizes of boxes and banners.
  • Early retargeting results through FBX have been biased toward retail businesses. It will be curious to see the results other types of marketing produce.

Final Verdict on Facebook Exchange

Unless you’re a marketer with the time, resources, and experience to run an experimental RTB campaign, I recommend you sit on the sidelines and observe for a bit. It could be that standard Facebook Ads are the key to your business’ success. If you are the experimental type, I recommend you consult this pamphlet about FBX. It should clear up any questions that this blog left unanswered.

Leave a comment and tell us if you plan on trying FBX. You bet we are!

About The Author

Brian Moran

Brian started Get 10,000 Fans back in November 2010 after figuring out how powerful facebook marketing could be for his baseball training website, trainbaseball.com. Brian focusses on helping entrepreneurs and business owners how to attract news leads using facebook.