Marketing tools: Using Facebook ads, some businesses get off to flying start

Social media appears to have dramatically reduced the marketing costs for small firms.

KARACHI:

Starting a business is a lot less expensive than it used to be, thanks to social media platforms, particularly Facebook. Several small firms have found themselves able to attract a large customer base through relatively cheap advertising on social media, allowing them to build up their revenues in the crucial early phase of their business.

Take the 14th Street Pizza Company in Karachi, for instance. It is a small, hole-in-the-wall, pizza delivery service that offers no dine-in options. When it first started in 2010, the company’s management wanted to minimise its marketing budget and focus purely on making sure that they spent the bulk of their scarce capital on procuring the equipment and ingredients for their product.

And so, rather than advertising on any other media, the company decided to focus their entire initial marketing budget on Facebook. This turned out to be a winning strategy for the firm, as it was able to earn revenues of higher than Rs20 million in their first year, largely off their social media strategy, which cost them only a fraction of what advertising in local newspapers and radio might have cost them.

According to a survey conducted by B Solutions, a digital media agency, about 62% of Pakistani users of Facebook say they use the internet and social media to find information about good and services that they are interested in purchasing. At least 10% report having actually made a purchase after being influenced by advertising or endorsements of friends on Facebook of a particular service or product.

Food businesses in major urban centres in Pakistan are especially adept at utilising Facebook as their primary marketing venue. The advent of popular groups such as SWOT and Karachi Food Diary, for example, offer Facebook users the opportunity to have conversations with each other, as well as the owners of restaurants, bakeries, and other food businesses.

Even directory websites such as Food Connection Pakistan use Facebook as a tool to help users connect with each other and leave reviews of various businesses on their website.

And even some businesses that long predate the advent of social media have started moving towards the platform for their primary marketing needs. Maria B, for instance, now spends 70% of its marketing budget on social media, up from just 10% a few years ago.

B Solutions claims to have helped one of their e-commerce clients boost monthly sales by 225% using a social media-based advertising strategy during Ramazan.

It is not entirely clear just how much of Facebook’s total revenues come from Pakistan, but most social media experts say the figure is likely to be miniscule in the context of the California-based company’s global total. Yet, the website is seen as a highly cost-effective tool for advertisers, particularly small businesses who want access to a captive audience.

Within social media, the most popular advertising venue for Pakistani companies appears to be Facebook, and not just because it is the most popular social media platform in the country. Facebook offers far more advertising options that are seen as more effective than Twitter.

And while LinkedIn also offers a diverse array of advertising options, it is used far less frequently by the average Pakistani user and has a far more specific demographic profile that only makes it compelling for a very narrow segment of advertisers. For instance, Standard Chartered Bank advertises jobs on LinkedIn, but hardly ever advertises any of its banking or other financial services on the website.

Published in The Express Tribune, September 24^th, 2012.