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« Michael Laskow of Taxi: Marketing + Entrepreneurial Skills = Music Business Success | Main | Management In The Music Industry »
Wednesday
Nov102010

Learning From Facebook Ad Failures

As with most folks who work in the tech business, I think it’s important to celebrate failures — they often teach us more than success. As such, I wanted to share a few Facebook Ads campaigns I experimented with and why they didn’t work.

The question I wanted to answer after the almost-too-easy success with the All Smiles campaign was “How easy is it to convert fans of related (but not directly tied) artists from Facebook Ads?

Answer: Not easy.

I set out to target three groups of fans with free downloads from A B & The Sea: Jukebox The Ghost (with whom they were touring), Katy Perry (whose song they covered), and Beach Boys (to whom they sound most similar). I set up Facebook ads driving to dedicated landing pages (eg - http://abandthesea.net/jukebox/) with unique Topspin widgets on each so I could track conversion data at a granular level. Here’s how each campaign broke down:

Jukebox The Ghost

  • 110,774 Impressions
  • 72 Clicks
  • 0.065% CTR
  • $0.41 CPC
  • 18 Emails
  • $1.65 CPA (Cost Per Acquisition — cost of getting a new email address)

Katy Perry

  • 383,365 Impressions
  • 211 Clicks
  • 0.055% CTR
  • $0.19 CPC
  • 3 Emails
  • $13.29 CPA

Beach Boys

  • 110,495 Impressions
  • 81 Clicks
  • 0.073% CTR
  • $0.38 CPC
  • 8 Emails
  • $3.89 CPA

These are clearly a far cry from the $0.33 CPA we saw consistently in the All Smiles campaign. But why? The difference is in degrees of separation.

For All Smiles, Jim is part of these other bands that people already love (Modest Mouse & Grandaddy). He’s merely introducing a different project to people who already love the music he plays. Had we gone about the ads in a slightly different way (eg - “Like Modest Mouse? You’ll love All Smiles!” instead of “All Smiles (Jim from Modest Mouse & Grandaddy)…”) I think the results would have been markedly different. For these A B & The Sea ads, all we had was the power of suggestion — “We (the people you don’t know or trust) think you’ll like our music. Won’t you please give it a shot?” (It’s the same approach that people often take to blog outreach — see why it’s hard? More on that another time.)

What the data tells us (beyond “Um, yea, this is expensive. Let’s stop.”), though, is the priority order of those degrees of separation — touring with a band is a closer connection than sounding like a band, which is a closer connection than covering someone’s song. This helps us begin to build a value hierarchy for related artists, which we can use when planning bigger marketing campaigns. In order of value:

  • Explicit Introductions — We’ve seen this work now with Fanfarlo, The Pixies / Interpol, and several others. Using the artist’s voice to recommend another artist is about as strong of a recommendation as you can get.
  • Implicit Introductions — This is the All Smiles case — it’s not Modest Mouse telling their fans about the record explicitly, but there are clear ties to the band which are messaged to fans of Modest Mouse.
  • Professional Relationships — Be it touring together, signing to the same label, or any other professional relationship, there’s a nameless tastemaker who has put the two brands together at some point, implying some correlation.
  • Similar Sounds — This works far better organically or through the voice of a tastemaker — someone (or some web service like Pandora or Last.fm) you trust has to make the connection between the two sounds for it to have value.
  • Similar Content — Just because you like “November Rain” doesn’t mean you’re going to like the Darude 30-minute club mix version of it.

We’re just getting started :)

There are tons more tests we can run across the board, and ultimately it all comes back to helping us prioritize our efforts. That is the real value of data — you can know almost instantly how any given effort performs and whether or not you should continue down that path.

My proposals to clients rarely have details past the first week, even for longer retainers; instead, they say the next steps will be based on the data collected along the way and list some guiding principles or prospective targets. I encourage everyone in the music business to start thinking that way as well — the most successful tech businesses are the most flexible, and ultimately we’re all running little tech businesses.

Ty runs Sum The Greater, a music blog and direct-to-fan marketing company out of San Francisco. He spent two years managing Artist Services at Topspin and has since dedicated himself to helping small bands build actionable fan bases. He has written several follow-up posts on Facebook Ad campaign success, which areavailable here.

Reader Comments (16)

This is great case study Ty. It does seem to have more effect on me when seeing an ad saying "These guys sound like Radiohead" vs. The million Radiohead covers out there.
I'm curious what your thoughts would be on facebook ads for your company rather than specific clients? Have any experience in that?

November 10 | Unregistered CommenterDee Bo

This information is fantastic - thank you so much Ty! It is great to see these ventures explored and studied! It will certainly help me when I decide to venture into FB Ads on my own.

Jon

November 10 | Registered CommenterJonathan Ostrow

This info can be applied to any kind of promotion where you are trying to reach new fans. Thanks for the data. This sort of thing is always welcome,

November 10 | Registered CommenterSuzanne Lainson

I think your sample size is too small to draw any meaningful conclusions. It strikes me as odd that the Katy Perry cover garnered the most clicks and lowest CPC, and yet the highest CPA. Personally, I think it makes more sense to just measure CPC. Unless I'm misunderstanding what a click signifies (quite possible!), each click is a like, which means you can send them updates through Facebook. Sure, it's not an email address, but it's a direct line of communication.

Speaking of CPC, my campaign has been cruising along at $0.10 for over a month now. I covered an a-ha song on my latest album, and based my ad on that connection:

658,771 Impressions
768 Clicks
0.117 CTR
$0.10 CPC

Brian (Color Theory)

November 10 | Registered CommenterBrian Hazard

Brian,

In this case, as I understand it, each click is just a click on a Facebook ad, that takes the user to the landing page that Ty mentioned, where presumably the user can enter his or her email address and get a free download. So a user could click on the ad (thereby costing Ty and his team money), but not do anything on the landing page. There's no further communication with that user and so the money is wasted.

The CPA for Katy Perry fans in this example is so high just for that reason: 211 people clicked on the ad, but only 3 gave their email addresses in exchange for the download.

November 10 | Unregistered CommenterKen Hiatt

Thanks for sharing your insight!

And while I appreciate your in-depth analysis on the value of paid Facebook tools, I wanted to share this blog post that outlines the uses and capabilities of FB ads (whether they work or not.)

November 10 | Unregistered CommenterGrayson Braswell

I think the difference here is between what you're trying to accomplish. Just getting someone to click over to something is typically going to cost far less then a CPA (cost per acquisition) which in this case is an email address from a user.

Really, as I see it, what it comes down to is who and what kind of potential fans are you trying to target. A succinct point in this article is the Darude Remix of "November Rain." Identifying and then targeting your potential market is the goal.

Good article. I think it highlights a lot of the intuitive aspects of direct to fan market strategies. Nice job Ty.

November 10 | Unregistered CommenterNoah Lampert

Again, maybe I'm misunderstanding, but for my ad, the way to get to the landing page is by clicking the "like" button. So a click = a like, which means you can market to them by sending out updates from your page. Mission accomplished! :)

November 10 | Registered CommenterBrian Hazard

Hey all -

Thanks much for the great response! I'm hopeful that this inspires more folks like Brian to share their data and that we can all build a better understanding of how to navigate this ever-changing business.

Dee Bo - I have not done Facebook ads for my own business because I am not looking for new clients. I prefer to work with friends who will allow me freedom to experiment and share the data (good or bad) with the world. Soon, though, I'll be doing ads for a Facebook App, which should be an interesting challenge, but will ultimately follow the same principles.

Brian - a "like" is great, but it's not nearly as strong of a tie or a marketing channel as email when it comes to offers. Because our ultimate goal is to sell something to these fans, we want to establish contact with them in the optimal channel for offers, which is email (one of many surveys that indicate such: http://www.smartfocus.com/NEWS-EVENTS/News/News-Details/smid/833/ArticleID/194.aspx). For us, a "like" is a secondary action, not a primary.

Ken & Noah - spot on :)

<3

November 10 | Registered CommenterTy White

Ty

I went to the Facebook ad panel at CMJ all bright eyed and bushy tailed and I was utterly confused by the end of it!

Thanks for sharing these very telling insights. I could write a book about blog outreach (oh wait, I already did) and how it is also very hard to convert bloggers into believers based on the same thought lines you have outlined here.

Looking forward to reading more on your site.

Ariel Hyatt

November 10 | Unregistered CommenterAriel

I think the Facebook "like" stuff is pretty useless compared to an email. I like anything that's suggested to me & never read the messages from them.

I don't know if those prices are a little high, I know my experience with Google & Facebook ads is that I end up getting placements when bidding a lot less than they suggest.

I do think it is worth noting that it looks like the CPM is about $5, which is a pretty decent rate. At least these days we all can track if clicks lead to sales & all these things....

November 10 | Registered CommenterBrian John Mitchell

Thanks for sharing such an in-depth analysis!

Facebook Ads may not deliver as much as we had anticipated, but I don't think that renders them next to useless. uPlaya has a great blog post on how music artists can get CREATIVE with them to maximize fan engagement and ultimately, drive revenue for their music. You can read through these quick and easy TIPS here!

November 11 | Unregistered CommenterGrayson Braswell

Great artice, I'm actually doing pretty well with the FB ads at the moment, I think most of my FB fans have found me via my current campaign.

November 11 | Unregistered CommenterAidy

Really useful, Ty. I can't help but wonder if the cover-song approach was exactly backward - if I'm happy with the Katy Perry version of a tune, I'm not necessarily looking for someone to reinterpret it for me. You might find more interest from non-fans ("I Will Survive" did pretty well for Cake when they covered it in the '90s, but I'm betting the majority interest was NOT from hardcore Donna Summers listeners).

I'd be pretty intrigued by an ad that said "hate Katy Perry? you'll love this cover!" But since there's no "hate" button on Facebook...

November 11 | Unregistered CommenterBenjie Hughes

I think people are more willing to click on an ad and submit an email forless publicized/etc.artists. Why give an email to Katy Perry or Beach Boys? They are ubiquitous. There is no "tribe" there. Everyone knows who they are, and everyone sees them (at least in the case of Katy Perry) 24/7. I'd much rather give an email and have a connection with Jukebox The Ghost. Not EVERYONE knows them. I think that explains it.

November 13 | Unregistered CommenterMarlowe

My first thought after reading this was that Katy Perry doesn't belong in any campaign. Why? I remember when I was very young and into Madonna and Michael Jackson. In no way was I interested in finding new music, especially not something that would take any effort at all. I think Katy Perry represents a type of music that works in a demographic that just doesn't care about discovery of new artists. Correct me if I am wrong...The Beach Boys would tell a different story perhaps, but they are essentially music from another a generation. People listening to the Beach Boys on a regular basis are probably also not as active in searching for new music. You have to want it...This is just my knee-jerk reaction...which is obviously in line with having a strong correlation between the artist you are pitching and the artist that is being compared to. I believe that people who are into finding new music are generally well-acquainted with less-mainstream music. Perhaps we shouldn't be using Katy's name at all...

November 15 | Unregistered CommenterChristina Horn

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