Taking the plunge into social media advertisement isn’t too daunting when you understand some of the basic metrics behind lead generation, as well as the need to test ads before making major commitments. <\/p>\n\n\n\n

Entrepreneur<\/p>\n","protected":false},"excerpt":{"rendered":"

Most marketers today understand that social media advertising is a critical component of the marketing mix, but sites like Facebook and Instagram can be intimidating for individuals who aren\u2019t especially social media savvy. In order to get a clearer picture of optimal social media ad strategy, I reached out to Chris Chung to get his insights on some of the most common questions that get asked about advertising on Facebook. 1. How much should you spend on Facebook ads? This question comes up often but people tend to overthink it, according to Chung. He suggests that three better questions to ask are: How much is each customer or lead worth to you? Here is a simple formula you can use to calculate the value of a single customer\/lead during the first 30 days: (Total 30-Day Revenue) \/ (Total # of Customers or Leads) = 30-Day Value How much of that 30-day value are you willing to spend on acquiring a single customer or lead? Are you willing to spend 25 percent? 50 percent? 75 percent? Or are you willing to spend the full 100 percent knowing that they will buy again in the near future? Is your golden number realistic? Once you calculate the 30-day value and determine the percentage you are willing to spend on acquisition, you then have to research whether the number is realistic. If the industry standard is $20 to acquire a customer per lead and you can only afford to pay $15, Facebook ads might not be your best choice. Alternatively, you might want to see if you are able to increase the value of the customer by changing your offer. Related Article: How to Keep Up With Customer Expectations Remember that Facebook is a bidding platform, so whoever pays the most will win the bid. Using the same example, if the industry standard… <\/p>\n