SocialWire Dynamic Product Ads Solution Boosts Order Values, Click-Through Rates
SocialWire, an ad recommendation engine, has recently released Dynamic Product Ads, a platform designed to do for Facebook what standard product recommendation engines already do for Amazon and other online retailers.
Modeled after the "people who bought this also bought..." approach, Dynamic Product Ads has been in beta testing since April 2013. Now widely available, the solution uses customers' search data to target advertisements and deliver personalized purchase recommendations in a space where consumers spend a significant portion of their online time.
Until now, advertisers have thought of Facebook and Google as two separate entities—the former was useful for building brand awareness and generating word of mouth, while the latter was the one more effective at driving traffic to e-commerce sites and ensuring subsequent sales. SocialWire is disparaging that belief, company CEO Bob Buch says.
"Buying Adwords on Google has been a surefire, evergreen way to drive sales because it's automated, it's simple, and it works," Buch says. "Facebook, however, has been hit or miss. Consumers don't really go on Facebook to shop, and knowing that, marketers haven't really been banking on it to contribute to sales," he adds.
What makes SocialWire's Dynamic Product Ads unique, Buch explains, is that the platform isn't designed to make Facebook function more like Google for advertisers—rather, it's designed to leverage the "best of both worlds," he says. The solution works similarly to Google Adwords; after a retailer buys keywords on SocialWire, the company's recommendation engine connects to the retailer's online catalog and pulls out the products that relate to the keyword. Once the related products are pinpointed, SocialWire can structure and launch an ad campaign to run on Facebook.
"If a consumer searches for 'riding boots' on Google, Google Adwords picks it up and generates ads based on this search. Our solution works the same way. If someone searched for 'riding boots' online, SocialWire ensures that when they are on Facebook, they are served ads related to that search," Buch says.
Though marketers have shied away from Facebook in favor of the dependability of Google Adwords, it is the marriage between the two that makes SocialWire effective. In one case study, Facebook ads boosted return on Google ad spend by 30 percent, increased the click-through rate by seven percent, and raised average order value by 24 percent. The solid results, Buch says, can be attributed to the synergy between the two channels. While Google is effective at meeting consumers' immediate purchasing needs, it is not an effective tool for building new demand. Facebook, on the other hand, is all about discovery and demand creation. Consumers browsing Facebook with no intent to shop can stumble across a product and become interested, for example. "They weren't looking for it, but that doesn't mean they're not going to buy it," Buch says.
In another case study, SocialWire also found that 82 percent of purchases from Facebook ads came more than 24 hours after the initial click, and 54 percent came more than a week after the click, suggesting that though Facebook doesn't guarantee immediate purchases, it can be a game changer when it comes to delayed conversions. "Facebook advertising's true value is in downstream revenue. This is in contrast to retargeting and search, which focus on more immediate revenue," Buch explains. "With Google, advertisers may be able to keep sales steady, but they won't be able to grow sales unless they can grow demand. Facebook can help them do that in a way that Google can't," he adds.
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