Facebook Combining $50 Ad Credits and 3 Simpler Ad Tools to Attract Small Businesses

Facebook will this week announce a new push to get small businesses using the site for marketing, according to USA Today. Facebook COO Sheryl Sandberg told the newspaper that 200,000 small businesses will receive $50 advertising credits. These can be used with three recently launched tools that make it easier for businesses to reach local and relevant potential customers: zip code targeting, broad interest category targeting, and WildFire’s Storyteller app for Sponsored Stories ads.

Thanks to third-party Ads API tools and services, Facebook has gotten many of the world’s largest brands advertising on the site. However, the high minimum spend required to use these tools and services, and the complicated nature of the self-serve ad tool may have excluded small businesses. By luring SMBs in with ad credits and helping them execute successful campaigns, Facebook may be able to significantly increase revenues by turning the longtail of small businesses into heavy advertisers.

Sandberg said about small businesses and Facebook, “We’re not going to stop until all of them are using it to grow their business.” As the majority of Facebook’s revenue comes from advertising, an influx of new small business advertisers hooked with the $10 million in ad credits could boost revenues. In those experimenting with the ad credit become longterm advertisers, Facebook might be able to lofty projections Goldman Sachs is said to have made when it contributed to a $1.5 billion funding round for the social network in January.

In the past, Facebook has given free advertising credit to those registering for new ad accounts as well as through promotions with Visa Business Network and American Express’ Small Business Saturday and Big Break for Small Businesses. American Express also recently began allowing businesses to buy Facebook ads with Membership Rewards points.

New Tools Simplify Facebook Advertising for Small Businesses

The ad credits won’t help if businesses can’t attain success with Facebook’s self-serve ad tool, though. Fortunately, the promotion comes soon after Facebook launched two enhancements to its ad marketplace.

Last month Facebook added the ability to target ads to users in specific zip codes, which lets local businesses reach potential customers in their neighborhood. Previously, ads could only be geographically targeted as narrowly as by city, which may have been too broad for local businesses in big cities. Early tests by Ads API partner Blinq Media showed thats ads targeted by zip codes showed double the click-through rate of those  targeted by city.

Broad interest category targeting became available in the self-serve ad tool in April. It allows advertisers to target users who Like anything related to a broad topic, such as food & dining or fashion retail. This is much simpler for novice advertisers than selecting individual keywords to target.

Facebook also tasked WildFire Interactive, a third-party Page management Preferred Developer Consultant, with building an app to simplify use of its social ad unit Sponsored Stories. The ad unit amplifies the reach of news feed stories published by users that mention a business by turning them advertisements in the site’s sidebar. However, businesses have to get users mentioning them first before they can buy the more compelling types of Sponsored Stories, which can be difficult for those without experience building or using applications.

Wildfire’s Storyteller Facebook Page tab app solicits these mentions by allowing businesses to ask questions to their fans. The answers published to the friends of respondents can also be turned into Sponsored Stories. To ensure only positive mentions are promoted, businesses can enter a blacklist of negative words and names of competitors and answers containing these words won’t be published or amplified. Storyteller comes as part of Wildfire’s licensable Page management tool.

The one part missing from the equation is education for small businesses. Facebook’s can’t expect businesses to find and take advantage of these tools on their own, so it will need to pair the ad credits with resources designed specifically for onboarding small businesses to the self-serve ad tool.

With the tools, ad credit to experiment with, and knowledge to run campaigns that bring them new customers, small businesses could be walked through a positive first experience with Facebook ads. Soon they could be spending their own money on the ads, and Sheryl Sandberg could achieve her dream of bringing small businesses onto Facebook as she told USA Today, just as she brought them on to AdSense and AdWords when she worked at Google.