What If I Told You… Your Facebook Ads Don’t Even Reach 10% of Your Customers?

(Last Updated On: July 8, 2018)

You hear the shop local chant all the time, and it gets almost annoying to some. Brick and mortar stores asking for your business, hoping you won’t take your shopping dollars out of town.

It’s an ongoing struggle, one which has many businesses in small communities floundering, desperately grasping the latest in advertising options like Google Adwords, Facebook Boosts and even do-it-yourself social media posts.

These brick and mortar businesses are personalizing social media posts, taking on the do-it-yourself, proving they are hardworking people, seeking to directly connect with their customers, and boosting social media posts through sponsored ads. Looks good on them. Yet at the same time, are they telling those customers, “do as I say, not as I do“? The sheer irony of the small local businesses shipping their advertising dollars to giant corporations in California is, for the most part, missed by local consumers.

Fox and The Grapes

Claims like, “print is just not worth it anymore” and “radio costs too much” or the favorite, “nobody reads newspapers or listens to the radio anymore“, are, in fact, misconceptions fueled by a vast online network of misinformation. How people around the world consume information has transformed, and the internet has played a massive part in that transformation. Unfortunately it has led to a knee-jerk reaction by businesses to assume single major platforms, such as Facebook, are their windows to the world. Assuming “nobody” listens to radio or reads a print newspaper these days is as erroneous as assuming “everybody” is on Facebook.

Small local businesses face tight budgets when it comes to advertising. It’s not an easy task to choose the right marketing options. It is so much easier for business owners to consume information fed to them by those with an agenda, like 90% of people are on the internet or newspapers are just fire starter, when in reality, they are writing off venues to reach their customers without really knowing the truth.

It’s the fox and the grapes… the fox tries hard to reach the grapes at the top of the vines and, failing to do so, just says “they are probably sour anyways” and gives up.

Facebook. That’s where the customers are, and that’s where you gotta go to reach them…. but are you sure about that?

We all see the big statistics, 90% of people are on the internet, billions are on Facebook. But what is the reality of just how many local customers a company can reach when it cuts back on print and radio and sets it’s sights on the social media inclined portion of the population?

First off, you can find thousands of articles bragging it up about how Facebook rules the online world. According to Facebook’s own 2017 3rd quarter report, in the US and Canada combined there where 185 million daily Facebook users. As of July 2016, Canada and the US had a combined census population of over 359 million. So despite the misconception that 90%+ of the small town customers are reachable through Facebook ads, even Facebook’s own declaration tells you that percent of the population that uses Facebook on a daily basis is closer to 51%.

If you have heard higher numbers than that chances are they are including those who log in at least once a month. Those occasional users bring the number of Facebook users up with an additional 54 million, for a total of about 67% of the population.

In a recent report from CIRA, Canada’s Internet authority, users again show that social media ranks lower than many assume among the reasons they go online. Only 57% of Canadians polled by CIRA stated they spend their internet time on social media. Ironically, more, 61%, spend time reading news and current events.

Ways Canadians spend time online

  • 91% check/respond to email
  • 68% online banking
  • 61% news/current events
  • 57% engage on social media
  • 49% shop online
  • 38% watch movies, TV, videos online
  • 33% listen to music, radio and podcasts

So there is your starting point – 57% engage on social media, with approximately 51% using Facebook. So your Facebook posts and boosts will reach over half your customers, right? Not likely.

That 51% is only your potential total audience. So looking at a small community with a trade area population of 10,000 potential customers, 9,000 may be internet users and that means your potential audience in the town and residents in surrounding towns that shop there are 4,590 people.

What if I told you your Facebook ads don’t even reach 10% of your customers?

Organic Reach – Do-It-Yourself

Your Facebook Organic Reach is how many people you reach with posts you make on your Facebook page, with no boosts or sponsored ads. It is all about how many of those 4,590 potential customers you are actually reaching. Say you make a post about a product, you can look on your page and it shows you how many people that was seen by, however what it doesn’t tell you is how many of those people reached are in your market area. Of the 1,575 people reached in this example, no more than 600 where followers of the page, the remaining nearly 1,000 people reached where a result of page followers liking, sharing and commenting, causing the post to appear on their friend’s news-feeds. Many of those others could be among your local target market, but chances are hundreds are in an entirely different province or even in another country.

When it comes to organic reach, Facebook offers you very little data that you can use to track your posts and know if they are reaching your customers. Of course, they do that on purpose. Their goal is to entice you to boost that post and reach more people. To sweeten the pot, they add in the ability to focus on your home town.

Paid Reach

Boosts, Sponsored Posts and Ad Campaigns using Facebook are a great way to gain some control over who sees your ads. Take a look at this example of an ad targeted to people living within a 50 mile radius of Nipawin SK. So in two weeks, this particular ad has had 7,769 impressions but has actually only been seen by 1,093 people in the target area. This was a cheap test ad and the amount spent was $16.10 per thousand Facebook users reached. According to Facebook, the number of potential users in that 50 mile range was 14,000.

So, after two weeks, we see that this ad has still only reached barely 7.8% of this business’s potential customers.

In order to attempt to reach even 50% of those local users with a paid ad, your budget would have to be a lot higher. Even a campaign of $200 a day for 7 days will still not guarantee you the reach to 100% of Facebook users in that 50 mile range. You can bump up that budget but what won’t change is the range of “estimated people reached“. The reason for that is that is because when you buy ads on Facebook, you are not paying for a defined “slot” as you would in print, on the radio or even in banner ads on a website. When you publish your ad it goes into “auction” mode, meaning your budget dictates when and how often it is shown compared to the competition. And also, unlike most local media options, that competition can be widespread. You are battling for exposure against other local businesses but also against massive national marketing campaigns from big brands and corporate box stores. That’s why, no matter how big the budget, you will never see Facebook assure you that your add will reach every user in your target area.

Refine your audience or add budget to reach more of the people that matter to you

Are you sure Facebook really knows who's what their users want?
Are you sure Facebook really knows what their users want?

Do you know more about your target customers? Demographics such as age, sex, marital status, and personal interests can help you define which people you want to see you ad. In theory, that is exactly what you need to keep your Facebook advertising budget in check while reaching more of your customers. In theory.

Unfortunately the reality is that Facebook relies on user inputted data and some very poor algorithm guesses to select the users that fit into your refined audience. It is dependent on people being truthful about their age, and other personal information, as well as the interests their algorithm assumes based on the users likes, shares and even just others they are friends with.

Take a Data Selfie

But don’t take my word for it. If you use Google Chrome, the is an extension you can get called Data Selfie. You add it as an extension to Chrome, start it and let it run for a while, then you can take a look at the data results of your Facebook habits. What is sees and the assumptions about you it makes closely mirror how Facebook is watching you in the background. The first time I used it, it had data everywhere from dead on right and creepy to way out in left field. It tells you all kinds of things such as your religious and political inclinations, who you are best friends with on Facebook, and all kinds of guesses about your shopping and even socializing tendencies. In the absence of user inputted data about themselves, Facebook uses a similar method to define user demographics and personal interests.

So when you go ahead and define your market, narrow down those 14,000 to 5,000 people who are most likely to be your customers, you are basically rolling the dice. You’ve eliminated 9,000 people. You are now left literally hoping that those 5,000 really are the ones you are trying to reach and you aren’t missing too many of them by ignoring that broader market.

There is a secret to success using Facebook to promote your business

And it’s very simple. Don’t throw all your marketing eggs in the Facebook basket. Better yet, don’t advertise at all, anywhere. Step back from the process of placing ads, on Facebook or in print, radio or other digital media, and ask yourself, “How does this fit into my marketing campaign?“. If your answer is “What marketing campaign?“, it’s time to sit down and make one.

The practice of placing ads is not marketing. Every ad you purchase must compliment and co-ordinate with ads you place elsewhere. Unless ads are placed as part of comprehensive and detailed marketing plan for your business, you might as well take your money and head for the bar and drop it in the slot machines. Grab some lotto tickets on your way there.

When you are marketing your business, everything you do needs to support the big picture. To succeed with Facebook, you need to ensure it is just one part of that picture.

How to get a professional to help you with your marketing plan for free

Every small town with a radio station, print newspapers and digital news sites offers you paid advertising options. When their salespeople walk through your door, you may see them as someone who’s there to sell you advertising you don’t need.

You need to make an appointment with these “salespeople” and find out which ones are only interested in selling you an ad, as opposed to the ones who are willing to sit down with you and help you build the foundation of a successful marketing campaign, one that includes their media, but reaches beyond and utilizes all other venues, including Social Media, radio, print and digital banner ads. You may have to pay for the ads you purchase from them, but their years of experience in marketing comes as a free perk for being their customer.

Be cautious of are those who try to convince you to throw all your advertising eggs in their basket. Anyone who tells you one venue alone will reach all of your customers is leading you down the garden path.

Post Author: Joanne Francis