By LAURA LOREK
Founder of Silicon Hills News
They can hang their shingle, a Facebook business page, and reach their small town customers or a global audience.
And just a fraction of Facebook’s 30 million small to medium-sized businesses are active advertisers. In the last month, 1.5 million businesses spent anywhere from a few dollars to thousands of dollars on Facebook ads, said Dan Levy, the company’s director of small business. But it’s growing. And the growth is coming from mobile customers.
Of the small businesses using Facebook, 19 million actively manage their page from a mobile device, Levy said.
“If you’ve got a mobile phone and a Facebook page, you’ve got a mobile strategy,” he said.
Levy spoke at the first Facebook Fit Austin, a boot-camp style event to educate small business owners about how to use Facebook effectively to grow their companies. The sold out event drew more than 1,000 people to the morning and afternoon sessions at the Austin Music Hall. It featured a keynote speech from Levy, a small business panel discussion with local businesses and training sessions led by Facebook and its partner companies, QuickBooks, Square and LegalZoom.
It’s the first time Facebook has held these kinds of events in communities across the country, Levy said. The Austin event was the largest of five events, he said. Facebook also has an office in Austin with a few hundred employees. It handles North American small business sales from here, he said.
Small businesses have contributed to significantly to Facebook’s revenue growth. The 10-year-old company Wednesday reported revenue of $2.91 billion for the second quarter, up 61 percent from the same time a year ago. And mobile advertising revenue represented 62 percent of all its ad revenue, up from 41 percent for the same quarter a year ago.
Facebook’s advertising has gotten more sophisticated in recent years with more targeted ads. The company offers small businesses the chance to upload email lists and target their current customers using Facebook’s platform. They can also get really specific in targeting customers by location, gender, interests and other factors. Facebook also lets business owners “boost” their daily posts to reach more people for a few dollars or $50 or more.
“We want to be the solution that helps them reach their customers,” Levy said. “It’s really important for us to make ads that are relevant. Our goal is for the ads to be as good, if not better, than the content you see on Facebook.”
During his morning keynote, Levy said even plumbers have grown their sales using Facebook. He gave the example of Morgan Miller Plumbing in Kansas City. Jeff Morgan, owner, has landed new customers and hired employees on Facebook. He has seen a 39 times the return on the $2,000 he’s spent on Facebook ads.
The key is being authentic, Levy said. Morgan has built his brand and expanded his business by telling who he is. Trust is a major issue when it comes to hiring a plumber and Morgan provides information about his employees along with pictures of them on the Facebook site.To illustrate how local small businesses are using Facebook, Rhonda Abrams, author and USA Today columnist, moderated a panel featuring Chi’Lantro, Korean infused Tex-Mex food, Allens Boots, Yeti Coolers and Kendra Scott Jewelry.
Chi’Lantro, with more than 10,000 likes on Facebook, spends about $400 to $500 a month on Facebook ads to promote its food trucks, said Jae Kim, its owner. He started Chi’Lantro with $28,000 in savings and financed it with his credit cards. He now has five trucks in Austin and Houston, 25 employees and he plans to open a brick and mortar restaurant this year.
Yeti Coolers, founded in 2006 in Austin, makes high-end durable coolers for hunters, anglers and other outdoor enthusiasts. The company has 150 employees and more than 212,000 likes on its Facebook page. Yeti uses Facebook to communicate with its customers and to build brand loyalty and awareness, said Harrison Lindsey, its digital content coordinator. Authenticity is key to building the brand on Facebook, he said.
“We have to be very authentic and understand what our customer needs are,” he said.
Allens Boots, which has a location on Congress Avenue and a store in Round Rock, doesn’t do traditional radio ads anymore, said Kirsten King, marketing manager. It has also created two Facebook pages updated for the different customers in the separate stores, she said.
“The good thing about it is it’s cheap,” King said.
She estimates Allens Boots gets seven times return on its ad spend on Facebook.
Kendra Scott Jewelry, with more than 51,000 likes on Facebook, uses online analytics and tailors its posts to its targeted customer base, women between the ages of 18 to 34, said Lara Schmieding, spokeswoman. Its market research on Facebook has also helped the company decide where to open its next store in 2015, she said.