Anatomy of a Facebook Ad Failure

I once ran a personal (not personals) ad on Facebook using free credits, back in my naïve days. (I realize that age isn't a representation of work, but I didn't have much space to enter what exactly I worked on - and decided age is a quick clincher.)

http://files.markbao.com/fb_ad.png

It didn't really go too well. I'm the owner of a now-defunct Facebook ad network, so it's interesting to see the official one in action. I targeted it towards entrepreneurs and venture capitalists (though I had a separate one that targeted venture capital networks only, which I received 3,000 impressions and 4 clicks through.) After 242,000 impressions, I had 378 clicks, CTR of 0.16, and average CPC of 0.32/click and average CPM of 0.49/thousand impressions. In total, I took out $119 out of my free credit.

The results in terms of contacts: I received about 10 Facebook friend requests each day it was going, and about 3 LinkedIn invitations; I gained a few quality connections that were not just random people.

You can't put a price on a connection, but $119 is a bit to spend for that.

From his own numbers his conversion rate is coming in at 1.6%. Quick Google search suggests that 1.7% is average for referral programs, so his ad wasn't exactly a failure. The failure happens when we take into account Amazon's referral fee. It simply doesn't make sense to spend extra money on something that's intended to be used in no-cost situations, like alongside blog posts.

Numbers: http://www.grokdotcom.com/2008/09/22/top-10-online-retailers...

Sounds like he was incredibly close to operating a profitable affiliate advertising campaign- breaking even means he's onto something and could probably be eeking out a solid profit were he to tweak the ad copy.