Facebook Conversion API: Matching Online Ads to Offline Customers

Like digital marketers, Facebook is constantly looking for positions that help them prove their value with businesses looking to purchase advertising. Online, this is easy. If someone clicks on an ad and purchases the product, you can trace the sale back to the ad placement. But what if a business wants to bring people to a physical store?

Before a brick and mortar store spends money on Facebook ads, the social network will have to prove that the advertising will help generate in-store revenue. In business, you want to show how companies can do more with less, especially for small stores that might not have a large marketing budget. For traditional stores hoping to make the most out of their online presence, Facebook’s Offline Conversion API may be the solution you are looking for.

 

facebook phone ads
Image Courtesy of Facebook

What Is the Facebook Offline Conversion API?

To help reach local customers, Facebook created a tool that designs ads to specifically drive customers to your brick and mortar locations. Major retailers can create a dynamic campaign where hundreds of stores are customized within one ad, or a small business can create one solid ad for their single location.

Unlike some other ads, Facebook allows businesses to emphasize location. In the new ad, the product listing will share space with a map that shows your store that’s closest to the customer instead of just a link to your eCommerce platform. This reduces the friction of combing through a store-locator page, which forces the potential customer to leave the Facebook app to try and navigate your mobile site.

 

How Does Facebook Attribute Online and Offline Interactions?

Like Google, Facebook uses your own site-to-store metrics to estimate the value of your customers and your advertising. The social network doesn’t have access to your raw sale numbers, instead relying on average store conversion and order value that they can pull from analytics.

Using this information, Facebook can then give you a rough estimate of what sales your business can expect after placing a local ad. The Offline Conversion API will also help the company improve the accuracy of their estimates.

Thanks to the detailed location data available in today’s smartphones, the company’s analytics can show you how many people visit your store after viewing a targeted ad. This will provide better data for online user behavior, and allow Facebook to improve its value estimates over time. Let’s say your average store conversion rate is 10% and your Average Order Value, or AOV, is $45. When you start running local ads, you notice both an increase in foot traffic, and in your conversion rate/AOV.

Satisfied shoppers
Connect online interactions with offline sales with Facebook’s API

With better data, Facebook hopes to help you identify when one of your ads helps result in offline sales. Once Facebook flags a smartphone user as someone who saw and ad and went into the store, it’s able to use first-party data (provided by the retailer) to connect customers with social interactions. Merchants will supply information like customer emails, phone numbers, date of birth, zip code, or their names, which Facebook will then line up with online interactions to see who made a purchase.

Econsultancy points out that it may be easy to collect personal information online through an order form, but some store might not wish to collect this information offline, out of respect for a customer’s privacy. Furthermore, it’s easy for someone to pay in cash and decline to give their email, limiting their paper trail in the company.

If you to collect this information, however, you can combine it with Facebook’s data to gather valuable insights. Despite getting it’s start as a social network for college students, Facebook became a platform for people of all ages to interact online. This means that, no matter what age group you’re clients are, you can find them on Facebook.

 

Statistic: Distribution of Facebook users in the United States as of January 2016, by age group | Statista
Find more statistics at Statista

What Offline Attribution Means to Facebook Marketing

For the past few years, most companies only used social media as a brand awareness tool. The goal was to build your audience with potential customers, engage with them based on their needs or desires, and provide customer service to address problems and questions. Now, many digitally savvy companies use it as a top and mid-funnel tool, useful to promote sales and specific products, but rarely used as a closer. Facebook’s offline conversions API plans to change that.

This new API makes attribution easier by reducing the number of interactions with other channels. If a Facebook user can see where they need to go within the app, there’s no reason to use a search engine to visit your website for directions. (Considering that one out of every five minutes is spent on Facebook or Instagram, It’s not surprising that Mark Zuckerberg is looking for ways to keep customers on the app, even for the few seconds it takes to look up an address.)

While many business owners might feel squeamish at the idea of reducing site traffic, this is actually a good thing. You won’t end up attributing the same sale to multiple channels just because the customer clicked on a Google Ad when they were looking for your address.

Furthermore, Facebook’s offline conversion API proves the added value in social media marketing. If you’ve ever had to justify your ad spend, this API shows that you’re generating revenue from your position in the funnel. More than 80 percent of shoppers start their research online before making a purchase, and these ads are answering customer questions (where, what, and when) that they would have needed to search for elsewhere.

 

Alternative Site-to-Store Promotion Methods

Facebook and Google are just two companies that have been promoting site-to-store methods to prove their overall value to the business. Affiliate coupon sites like RetailMeNot and Ebates are both working to prove site-to-store value, from scanning receipts to linked credit cards for in-store cash back. As customers shift to shopping online, these digital deal sites can help local businesses track the effectiveness of their internet marketing.

On the retailer side, some companies are installing beacons around their stores that ping phones and analyze different types of customer behavior. With beacons, stores can get a feel for how customers travel around their store, what they linger at, and if they stop at items that were heavily advertised in different channels.

Most importantly, they can identify a new or repeat customer, and what digital path they took to arrive at the physical location.

Of course, all of your digital options don’t have to be complex. Tracking site-to-store behavior can be as simple as creating a unique coupon or barcode that is only found online, in an email, or on Facebook.

While there’s definitely a risk that other channels will pick up the discount (like coupon affiliate sites) it will provide you with a ballpark figure of what type of advertising power different digital channels have on your stores.

In the next few years, the company that succeeds with site-to-store metrics won’t necessarily drive the most traffic, but will be the one that figures out how to provide the most accurate measurement of that traffic.

To learn more about integrating Facebook tracking solutions, read about our web analytics consulting services or contact us for a discovery conversation.

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