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Jon Czaja, Director, Small Business (North America), Facebook, talks with Abid Chaudhry, Senior Director of Strategy at BIA/Kelsey. This is a paraphrased report, quotes indicate verbatim comments.

Beginning with a walkthrough of what Facebook is doing to help brands connect with local consumers. Facebook has evolved dramatically. Gone are the days of focus on things like page likes and we’ve made a transition to providing a robust marketing platform.

30 million businesses have active pages on Facebook; 2 million are actively advertising on Facebook. There is a huge diversity in these businesses, from small to large and across all verticals that find value on this platform. The obvious reason is reach. More than 1 billion use Facebook every day, the vast majority on their mobile phone. Facebook Mobile users spend an average of 41 minutes a day consuming content on their phone.

Targeting is more accurate than the average online platform: 38 percent of targets are accurate on average, while Facebook is 89 percent accurate. “We’re talking about real people and not cookies.”

Example business: Divas SnowGear. They use Facebook to market cold weather gear to women.

Businesses can also enhance their targeting by “bringing their own data onto Facebook” to narrow and retarget messaging on Facebook. Additionally, Facebook can show “lookalike” customers who have similar characteristics to your existing customers.

Local Awareness is a product for multi-site businesses. The platform allows targeting of people near your stores, based on their use of Facebook (which can monitor location all the time if the user has approved). Shows Jasper’s Market as example: The company went from brand awareness to actual customer conversion through Facebook. Warby Parker have reached 5.2 million people with 31.7 million impressions for its 10 retail locations. It will be “very easy to create local campaigns for small business in many markets.”

He can’t share what Facebook is planning, but Conversion Lift is an current example of a tool to see the efficacy of Facebook ads, using a A/B model to analyze the impact of Facebook on offline transactions. “Not a new feature in the market, but new to Facebook.” is the destination for marketers to identify partners on Facebook that they can use to increase their reach and targeting accuracy.

Now to Q&A:

Abid asks: Are we seeing a pivot toward direct-response and conversion products at Facebook. What was the decision-making process for that move — have you left the brand advertiser in the lurch?

Jon: We believe Facebook can be relevant for both merchants and brand advertisers. We realized we have the ability to drive consumers to local business locations. That said, Facebook is still a powerful branding platform. Page likes were the branding solution on FB, but today we are concentrating on video. Advertisers can bid on impressions and position on pages as a result.

Abid: How to you keep this easy to use for the small advertiser while serving the large advertisers? Will everyone use the same UI?

Jon: We want it to be self-serve, all the way down to the smallest advertiser. Large brands use additional tools, such as “Power Manager” to control large campaigns with the same [backend system]. It is a different user interface and we’re seeing large advertisers partnering with agencies and others to address national brands.

Facebook is listening to advertisers and trying to speak their language. We’ve grown up and learned to think in terms and metrics that brands use.

Question from Audience: Are people feeling the new ads are effective or are they annoyed by them?

Jon: It’s about protecting the user’s experience. Customers have said they feel there are too many irrelevant ads, so we have reduced and changed the way we place ads. It makes sense that we keep the environment personally engaging and relevant, including the ads.

Abid: What is the view on native advertising’s impact on the user experience? How much does Facebook get involved in keeping ads relevant?

Jon: It’s a challenge. How do you convince a small business to take a good picture or shoot a good video. So, we share best practices and encourage business to look at competitors to understand what works well. We’ve also started sharing a “relevance score” that shows how the algorithm that handles newsfeed placement works, so that business can make adjustments. We also encourage people to test ads, to see what images work. You can experiment on Facebook to quickly modify your approach.

Audience: Can a business use Power Editor to run these ads? What do SMBs do now, while we wait?

Jon: Anyone can use Power Editor. But I recommend you don’t use it unless you are placing hundreds of thousands of ad impressions. In the interim, there are third-parties that can help business get effective performance.

Abid: As Facebook becomes more advertising centric, how is the Partner Program going to integrate the partners’ needs?

Jon: Facebook can’t build everything itself. If there are other partners out there to build on our platform and encourage better performance, then advertisers will be able to choose to go to Facebook or an agency. It’s an “All-of-the=Above” strategy.

Abid: Facebook is becoming a better competitor with Google, but do you think of Google as the target?

Jon: We’re sort of in our own world. We are in a race to close the loop on the offline transaction, but I can’t share much information now.

Abid: How is the inclusion of friend-to-friend payments related to the future of advertising and transactions? What’s the strategy for working with large agencies?

Jon: The message to both is the same. We have a billion users a day. The way you talk to advertisers changes based on their size and scale. We work to help big campaigns elevate effectively, and measurements for large partners to help understand the impact of a Facebook ad investment. With smaller businesses, we’re working to build out what I hope will be best-in-class customer service to help them advertise on Facebook.

Abid: Is there a strategy for working with services industries?

Jon: We are vertically focused within the sales teams and think there are best practices among large businesses. We’re going to bring those vertical insights all the way down to the small business.

We’ve seen success with Local Awareness, which was designed for small business. But we think it has uses for multi-site national brands. The ability to target people near your store will be a benefit to business of every size.

Audience: Your partner program has restraints on small agencies, with less than 1,000 clients. Will that change?

Jon: Not that I know, but if you have not checked our recent updates, you may find it has already changed.

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