Why So Many Small Businesses Are Paying For Facebook Ads?

Why so many small businesses are paying for Facebook ads? Are the days of free social media for promotion over? Here's why large companies are abandoning free posts to Facebook in favor of paid ads.

Are the days of free social media for promotion over? Here’s why large companies are abandoning free posts to Facebook in favor of paid ads.

In 2014 and early 2015, a number of surveys asked marketers to rate the value of Facebook to promote their business (both in terms of paid and unpaid content). The overwhelming results were that companies saw little or no value from content they posted in the new feed. That is, unpaid posts had less engagement, or no engagement, compared to 2013.

However, companies that paid for ads, or paid to promote posts, were able to track engagement, sales or both. Engagement is some kind of action, comments, likes, click-throughs, a generated lead, website visit or a sale.

It seems then, that Facebook is becoming pay-to-play.

And this is not lost on small businesses who are seeing less traffic from their website and SEO (search engine optimization) strategies. As small business owners spend more and more time posting content to social media, they are increasingly seeing lower, or no, results. They too are talking with other business owners who are running ads on Facebook.

Big or small, a lot of companies are realizing that ads on Facebook work. And they are much cheaper than adwords (Google’s keyword bidding system). For a very low cost, Facebook is returning results taken your content strategy fits your audience.

Free advertising isn’t free

Some consultants are recommending the business spend as little as a pound a day to run ads. Facebook will target people who are likely to engage with the ad. The cost is so low, that many small business are realizing that it’s affordable and effective.

Even if not at first, many owners realize they are spending too much time trying to use social media to get business. With any paid advertising, once you have a ad that works, you can run it again and again without any time commitment. You just let it run.

And this is the rub. Free advertising isn’t free – it often costs time. Which would be OK, if it produced results. But today, posting to social media is becoming less effective and paid advertising is becoming the only way to rise up over the noise of competing messages, and reach a target audience. And Facebook as emerged as the lowest cost way to do that.

But this is no panacea. As advertisers are seeing more engagement from paid Facebook ads, Facebook rates are beginning to rise. What will be interesting to targetsee is if Google AdWords rates start to decline. Likely they won’t, but don’t expect a rise in their rates any time soon. Google may be stuck with it’s current rates as Facebook takes an increasing share of the ad currency.

While this article may seem like I am promoting Facebook ads, I’m not. If you own a website, ask yourself if you are getting better results from free social media posts than last year? Or worse? And how much time are you spending trying to get traction on all those social media sites? If you calculate the value of your time, how much is it costing you?

With that number you can ask yourself if advertising on social media sites is more or less expensive than free.