Facebook's Q1 earnings call with analysts focused on how small businesses use its free Pages feature, PYMNTS.com reported.
While the company wants to offer paid advertising tools for businesses of all sizes, it noted its free offers puts the social media site above others, particularly for small and medium-sized companies.
"SMBs we think, are a very core competitive advantage for us," said COO Sheryl Sandberg said during the call, according to PYMNTS.com. "It's prohibitively expensive for most small businesses to reach people digitally. Thirty-five percent of small businesses in the United States don't have a Web presence at all. And setting up a mobile app, getting people to find and download a mobile app, can be even more expensive."
Instead of investing in a responsive website or social media app, many small businesses use Facebook Pages to access mobile consumers. Currently, Facebook hosts over 50 million pages for small businesses and 80 percent of them are also on mobile. This allows small businesses to use some of the same tools as companies with a much bigger budget.
Using Facebook as a marketing platform
Still, Facebook's paid features are incredibly powerful, so small businesses shouldn't discount them completely. Kissmetrics expects social media ad revenue to encompass 16 percent of all global digital ad spending by 2017, reaching $35.9 billion. Facebook, which owns Instagram, will likely account for a large portion of those ads.
The marketing company provided tips for businesses hoping to use Facebook to reach consumers. Facebook's lead ads, a recent introduction, let companies acquire lead data directly from the social media site. According to Facebook, companies using its lead ads spend four times less per lead than they did previously.
Facebook also has an extensive reporting section that shows detailed ad performance analytics. Businesses can see which customers are more likely to react to an ad based on gender, age, location and other demographics. They can also observe which ads are best at increasing conversions in addition to comparing marketing metrics on Facebook's website, mobile app and Instagram.
Businesses can also advertise to look-a-like audiences on Facebook. This feature is incredibly beneficial for reaching new viewers. Facebook generates a selection of users similar to a company's existing fans and audience based on interests, demographics and how these users interact with the website. Businesses can then make ads to target these audiences directly.
Social media managing site Buffer suggested businesses vary their posting time on Facebook. It experimented with posting at non-peak hours and found that clicks for content updated at 11 p.m. increased by 25 percent. If this content leads to a checkout page, there's a good chance businesses can increase their online payments with a similar strategy. In addition, link posts – which are more influential for Facebook's news feed algorithm – saw a 70 percent increase in median reach and 20 percent in average reach. Clicks for both increased almost 10 percent.
Facebook is a useful tool for small businesses, especially online retailers hoping to increase their e-commerce payments. The platform gives organizations with tighter budgets a variety of free and paid options to market to consumers.