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Survey shows strong adoption of Facebook ads among small businesses

March 13th, 2012

facebook adPayvment, the number one Facebook ecommerce platform, says results of its F-Commerce Facts survey of over 100,000 sellers on Facebook, the majority of which are small businesses with less than 500 Facebook fans,  shows strong adoption and favorability towards Facebook Ads, with most sellers planning to use the social network’s ad products again.

The data also shows that small sellers are using a wide variety of outside marketing channels to drive traffic to their Facebook storefronts, including Twitter, Google ads and email marketing.

“While a handful of large retailers have put their F-commerce efforts on hold, there are hundreds of thousands of small businesses who are successfully selling products on Facebook”

“While a handful of large retailers have put their F-commerce efforts on hold, there are hundreds of thousands of small businesses who are successfully selling products on Facebook,” said Christian Taylor, founder and CEO of Payvment.

“This data provides a quick snapshot of the current state of Facebook commerce and shows a robust and vibrant environment in which sellers are aggressively marketing their products through many different channels, driving sales for their products and bringing revenue and traffic back to Facebook.”

Key conclusions from the survey include:

1. Facebook Ads are the top promotional tool for sellers beyond general Facebook marketing.

Facebook sellers are doing their part to fuel Facebook’s $5 billion forecasted ad revenue this year.

More than one-third (39 percent) of respondents report having used Facebook Ads, making this the most prevalent marketing tactic used by sellers to drive traffic to their stores beyond general Facebook marketing — such as promotions and deals posted to their wall — and nearly 70 percent of respondents say they plan to use Facebook Ads again.

Facebook Ads enjoy high favorability among Facebook sellers who have used them. Sellers cite effectiveness in fan and customer acquisition as their top reason (68 percent) for planning more Facebook Ad campaigns.

Other reasons for continuing to use Facebook Ad programs include the ability to start and stop campaigns (60 percent), Facebook’s targeting capabilities (60 percent) and Facebook Ads’ ease of use (55 percent).

But not all Facebook sellers have had success acquiring new fans and customers with Facebook Ads. Among the 30 percent who say they wouldn’t use Facebook Ads again, 68 percent report that they did not acquire many new fans or customers through this channel.

Lower-than-anticipated results may be due to confusion about how to effectively use Facebook Ads, as one-quarter (25 percent) of respondents who haven’t tried Facebook Ads say they don’t understand how to use them.

Cost is also cited as another top reason for not using Facebook Ads again: 65 percent say they wouldn’t continue using Facebook Ads because they are too expensive. Interestingly, among those who aren’t currently advertising on Facebook, only 32 percent say that Facebook Ads are too expensive to use — the majority (63 percent) cite lack of budget as their primary deterrent.

2. Sellers are using many outside marketing channels to bring traffic back to Facebook stores.

FacebookWhile most sellers are actively marketing their Facebook storefronts and products on Facebook (84 percent) and 39 percent are using Facebook Ads, many are also using other marketing channels to drive traffic to their stores.

More than one-third are promoting their Facebook store on their company web site (38 percent), 34 percent are using Twitter, and 30 percent are using email marketing. A small percentage also use paid media outside of Facebook to attract new fans and customers: 12 percent are running print ads, 9 percent are using direct mail and 8 percent are buying search ads on Google.

The data also shows that Facebook sellers plan to increase their marketing efforts across the board over the next six months.

Use of Google Ads is expected to grow by 38 percent; use of print ads is expected to grow by 30 percent; use of email marketing is expected to grow by 29 percent; and use of direct mail is expected to grow by 26 percent.

In addition, 21 percent more businesses plan to promote their Facebook store on their company web site over the next six months, which would bring the total number of sellers linking back to Facebook from their web site to nearly half (46 percent) of all sellers.

3. The ability to market and sell products on the same platform is a top benefit for sellers.

The survey also validates the appeal of Facebook as a platform where sellers can both market and sell their products. When asked what they like best about selling on Facebook, the majority of respondents cite the ability to promote their products via social marketing as a top benefit (61 percent). About the same number of people (60 percent) also like that customers don’t have to leave Facebook to buy their products.

Familiarity with Facebook and its ease-of-use are also perceived as major benefits of selling on Facebook. Nearly 50 percent say it is easy to set up and maintain a storefront on Facebook, and 40 percent say they like selling on Facebook because they are already familiar with how Facebook works.

Product discovery is also seen as a benefit, with one-third of respondents (33 percent) saying they like selling on Facebook because shoppers can more easily discover their products.

4. Facebook storefronts are the sole sales destination for more than one-third of sellers.

Facebook storefronts are the sole sales channel for more than one-third of Facebook sellers (37 percent), while 63 percent of sellers are also selling products on their company web site.

Other top sales channels for Facebook sellers include trade or craft shows (30 percent); retail stores (29 percent); eBay (29 percent); Etsy (21 percent); and Amazon (15 percent).

5. The biggest challenge for new sellers is growing their fan base.

Facebook commerce is a relatively new phenomenon and is still in its early days. Nearly 50 percent of respondents have been selling on Facebook for less than 6 months, and 72 percent report having less than 500 fans.

The majority of respondents (72 percent) point to their small fan base as the biggest challenge of selling on Facebook.

The data also underscores the need for additional tools and support to help sellers grow their Facebook presence: more than one-third of respondents (38 percent) cite lack of understanding about how to do marketing on Facebook as a top challenge, and 31 percent say they don’t have enough time to do marketing.

About the F-Commerce Facts Survey

The F-Commerce Facts survey was conducted by Payvment, the number one Facebook ecommerce platform whose more than 100,000 active sellers drive nearly 80 percent of all the shopping on Facebook.

This survey was fielded online, between February 15, 2012, and February 28, 2012, and sent to a random sample of Payvment’s seller base of over 100,000 business owners.

There were 750 total responses from sellers across 12 different countries. Nearly 50 percent of respondents were new sellers on Facebook (less than 3 months), and 72 percent of respondents report having less than 500 fans. No incentive was offered to complete the survey.

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