The Contractor’s Guide to Facebook Ads (Pt. 1)
“How do I grow my business with Facebook ads?”
Contractors ask us this question several times a week. It’s easy to see why: Facebook is a powerful tool for growing your home improvement business. But there’s a catch -- it’s one of the toughest advertising tools to get right.
And if you’re a contractor, Facebook is about to get even harder. Before August 2018, finding home improvement customers was relatively easy; you could target homeowners who live in your region.
However, Facebook is removing several of the obvious audiences: homeowners, first-time owners, etc. That means you have to up your Facebook game and get creative in how you find homeowners on Facebook.
At Hearth, we’ve run dozens of profitable Facebook campaigns. During that experience, we’ve built a proven, repeatable playbook of how to win on Facebook. (And yes, we learned most of it from mistakes we made!)
Here’s our process at a high-level:
Setup: Put the tools in place to track success.
Find the right audiences: Make sure you’re showing ads to the right people.
Improve your ads: Test text and graphics to find winning combinations.
Grow your campaigns: Once you’ve found a profitable audience and made great ads, invest more to grow your business (as long as it’s profitable).
Repeat steps 2-4: You should always be testing new audiences and ads.
This guide focuses on Step 2: Find Your Audiences (we’re working on detailed guides for the other steps – stay tuned!).
We wrote the entire guide with home improvement contractors in mind, and we’ve prepared an exclusive cheat sheet of 28 audiences you should consider testing. You can download it here, and we’ll go over how to use the list later.
Quick note: You will need a web developer’s help to install the Facebook pixel and set up ads tracking.
Let’s dive in.
What is an audience? And why start with audience testing?
Audiences are groups of people you select to see your ads. Audiences are the most important thing to test first, because once you’ve found the right audience, you can work on improving your ads for that audience to make more money.
For example, you could create an audience of males aged 30 to 50 who live within 25 miles of Dallas and like HGTV. This audience would then receive targeted ads from your business.
Facebook has 3 types of audiences: demographic & interest audiences, custom audiences, and lookalike audiences. We’ll explain how each of these work below.
Demographic & interest audiences
Demographics tell you about a person, and interests tell you pages people have liked or what Facebook guesses someone would like.
Using the example above, the gender (male), the age (30-50), and the location (within 25 miles of Dallas) are demographic characteristics. HGTV is an interest.
When combined, demographics and interests let you show ads to specific groups of people who you think are likely to use your services.
Everyone on Facebook – including your competition – has access to demographic and interest audiences. Custom audiences are different; they’re unique to your business.
Custom audiences are groups of people who have taken various actions that matter to your business.
Here are some examples:
- You can show ads to leads to get them to become paying customers
- You can show ads to previous customers to get them to complete another project
- You can show ads to people who have visited your website to get them to request more information
Custom audiences do more than let you target people who already know you:
You can create large audiences of people similar to a custom audience. These are lookalike audiences. (Facebook automatically finds these people; all you have to do is press a button).
For example, if you have a custom audience of paying customers or leads, you can create a lookalike audience to find other people like them in your region.
Lookalike audiences are among the most powerful tools on Facebook because they’re made up of people similar to those who add value to your business.
Preparing your audience list
Now that you know what an audience is, you can begin preparing your audience test. The first step is creating a list of custom, lookalike, and demographic audiences to test.
If you’re a home improvement contractor, we’ve made it easy to develop an audience list. We dug deep into Facebook to create a list of audiences that could help you find homeowners for your projects.
You can see the cheat sheet here. To download the sheet and edit it, press File > Download. Not every audience will work for you, so go through the sheet and highlight the ones relevant to your business.
You’ll notice that we kept demographics and interests mostly separate. This ensures your ads can reach the most people so Facebook can learn who is likely to convert off your ads. Then, after your initial audience test, you can refine your targeting.
Setting up your custom and lookalike audiences
Once you’ve narrowed down your audiences, you can put them into Facebook. Hold off on the demographic & interest audiences for now – you’ll make them when you create the actual ads.
Start with your custom audiences
There are two main types of custom audiences:
- Email-based audiences: You can upload email lists to create audiences. The more emails you have, the better the audience. If you have too few emails, Facebook may not let you use the audience.
- Pixel-based audiences: You can use the Facebook pixel to capture key events such as website visits, visits to order pages, etc. If you don’t have the pixel installed, you’ll need to install it. Click here for instructions on getting the pixel on your website (your web developer may need to help with this).
You can use Facebook’s audience tool to create your custom audiences. Read this article for information on how to do this. We recommend starting with the email-based audiences, but you’ll still need to install the Facebook pixel to run effective ads.
Facebook usually needs 20-30 minutes to create the custom audience.
Create lookalike audiences
Lookalike audiences are indicated by percents. For example, a 3% Lookalike of Paying Customers would find the people who Facebook thinks are within 3% similarity to your paying customers.
Click here to see Facebook’s step by step guide on creating a lookalike audience.
Start by creating a 5% lookalike for each custom audience. It’s normally better to start with a 1% lookalike, but since you’ll be limiting the ads to a relatively small number of people in your region, you’ll need to start with the 5% or the ads will be too restricted.
Facebook usually needs 20-30 minutes to create the lookalike.
Prepare your budgets
Decide how much you want to spend a day. This decision determines how many audiences you can test at a time. You should test an audience for at least 4-5 days, and follow the rules below for daily budgets:
- Interest/demographic & lookalike audiences: $10-$15 a day per audience
- Custom audiences: $3-$5 per audience (these audiences will be smaller so you can spend less)
Launch the audience test
You’re ready to get started! Make sure to install your Facebook pixel before launching any ads. You can run ads without the pixel, but they will be a lot less effective at best, and totally useless at worst.
Here’s what to do:
Set up your conversion event: A conversion event tells Facebook what you’re trying to achieve with your ads. Most of the time, this will be to get more homeowner leads. A conversion event would tell Facebook when someone has requested information, and Facebook will tie this back to the ad that drove the lead. Click here to see more about this (you will need your web developer’s help).
Prepare your ads: You can likely use the same ads across audiences, although if you have a custom audience, you may want an ad tailored to people who have visited your website. We are working on a guide that goes into more detail in creating ads, but for now, make sure your headline and text speak to the benefits of your business. Here is an article with more about preparing Facebook ads.
Set up your campaign: In Ads Manager (click here for instructions on how to use Ads Manager), create a new campaign called “Conversions>Audience Test” and set the Campaign Objective to conversions.
Set up your ad sets: Your campaign will have multiple ad sets, each one corresponding to an audience. Set up Interest & Demographic audiences in the Detailed Targeting section. Set up custom and lookalike audiences by selecting the audiences you created earlier under Custom Audiences. Each ad set should optimize to your conversion event. Be sure to narrow down the ads to your geographic region.
Launch the ads: Within each ad set, create your ad variations.
Whatever you do, do not pause anything for at least 24 hours. You should try to wait at least 5-7 days if you can before doing anything. Facebook needs time to learn who best to show your ads to.
If any ad sets don’t get results, pause them and begin shifting the old spend to the successful audiences. You can monitor their progress in Ads Manager.
You may not have any luck with your first batch of audiences, but don’t worry! Facebook has tons of audiences you can test.
There’s a lot more to mastering Facebook than finding the right audience, but with this process, you’ll be well on your way. We’ve got more guides in the works that focus on different parts of Facebook – stay tuned!
Questions? Feel free to contact us at firstname.lastname@example.org. We’d love to hear from you!