6 Types of Facebook Ads

While having access to a massive variety of advertising options is a marketer's dream come true, it can also make getting started a daunting task. If you're feeling overwhelmed, check out the following six types of Facebook ads to see how you can apply them to your own business.

1. Lead ads

The lead ad unit makes the process of collecting email addresses and building email lists incredibly easy. With this ad unit, your prospects can sign up for an email list (among other things) with as little effort as it takes to like or share a post.

The beauty of the lead ad unit is that Facebook auto-populates most of the fields that a prospect would normally have to fill out manually. This reduces friction, which makes them more likely to follow through.

2. Dynamic ads

Dynamic Ads (formerly Dynamic Product Ads) connect your store's product catalog with your Facebook ad account and pixel. When someone visits your site and then logs into Facebook, they'll see an ad that features the same products they were looking at on your website. As a result, the ad they see is incredibly personalized and relevant.

Multi-product Facebook ads, or carousel ads, are a dynamic ad that promotes a collection of multiple items from your online store. Each product has its own caption, image and destination URL. According to Facebook, advertisers who use the carousel ad type have a 30–50% decrease in cost per acquisition and a 20–30% decrease in cost per click (CPC).

3. Abandoned cart ads

Roughly 70% of shoppers abandon their cart, according to data collected by the Baymard Institute. In other words, for every 10 people who add a product to their cart, nearly 7 of them will leave your store without making a purchase.

How do you get these shoppers back to your store so they can complete the purchase? With retargeting, you can run a highly personalized Facebook ad aimed at these individuals. These ads typically offer an incentive, such as free shipping or 10% off, if the person returns to complete their purchase.

4. Customer thank-you ads

Many business owners have a bad habit of putting all of their marketing efforts into turning leads into customers, and stopping there. This is a huge mistake.

It's much easier to turn a first-time customer into a repeat customer than it is to turn a cold lead into a first-time customer. And it's often significantly more expensive to acquire a new customer than it is to retain a current one.

5. Existing customer new product ads

As I mentioned in the previous section, business owners often spend enough marketing resources on their existing customers. It's amazing considering the probability of generating a sale from a new customer is between 5–20% while the probability of making a sale from an existing customer is between 60–70%, according to SignalMind.

What's even more amazing is that repeat customers spend an average of 33% more than new ones and 80% of your future profits will come from just 20% of your existing customers.

6. New traffic generation ads

Retargeting is great, but unless you're driving high-quality traffic to your site, it won't be very effective. It's always a good idea to have a Facebook campaign driving potential new customers to your store. I call this type of campaign a first touch point ad, as it's likely the first time the person viewing the ad has heard of your business.

A/B test

It's always a good idea to A/B test your Facebook ads, regardless of the type of ad, but it's critical to test your first touch point ads. For a new campaign, create two or three copy options and another two or three creative options. Test these variations on multiple audiences.

You don't need to spend a lot of cash to do this right. You can invest a few dollars a day on each variation for a week and then analyze the results. Upon analyzing the data, ramp up the spending for your best-performing copy, creative and audience.

To begin advertising on Facebook, start small, experiment, measure results, and iterate. The types of Facebook ads mentioned in this article can be a foundation for you to build your business's long-term social media marketing strategy. Now that you're done reading, start testing!