BY ZOË HENRY
More than 60 million small businesses are using Facebook to grow their sales, some three million of which are deploying advertising. Now, the social media giant wants to help those companies reach new customers in promising international markets-- at no additional cost.
On Thursday, Facebook announced the addition of some new tools that will give small businesses a boost in growing their footprint abroad. The new features are designed to help business owners determine which markets they should expand to, and the best strategy to reach those customers.
"Digital strategies and technology are really helping small businesses to find new customers," said Katherine Shappley, the director of small business at Facebook. Her team of about 150 was inspired to create the new tools when they noticed that some people were already "hacking the system." Using Facebook's "Page Insights," business owners would gather data on the global locations where people were most interested in buying a product.
Essentially, Facebook wants to help startups to recreate their early successes in new countries. One of the new tools, called "International Lookalikes," is an expansion of a preexisting feature that lets business owners identify potential customers, based on the age, gender, and location of their current ones. With "International Lookalikes," businesses can identify potential customers abroad. Similarly, a new "Regional Targeting" tool allows companies to extend their advertising to the most promising areas of the world, based on where early customers were enticed by advertising. "It [the platform] looks at the initial conversion and finds similar clusters [abroad]," explains Shappley.
Facebook is also rolling out a handbook and informational webinars, aggregating publicly available data, to teach international marketing techniques to business owners. These tools are all free to use, beyond the existing cost to advertise on Facebook, which varies depending on a company's budget. As Shappley underscores, more than one billion people on the site are connected to at least one business in another country, including 60 percent of American users. (There's no pre-requisite for setting up a small business Page, so long as the user has a Facebook account.)
Many business owners have long-recognized the benefits of using social media to inexpensively target new customers, and retain the old ones. "Facebook is the most popular social media for small businesses like mine. We have meager budgets," says Gene Marks, the founder of Marks Group (and an Inc.com columnist). He recently touted the announcement that Facebook would show ads even in the presence of ad blockers in a Washington Post column. Little Passports, a San Francisco startup that sells educational toys, recently used Facebook to find customers in six foreign countries. The company, which first launched in 2009, is now on track to see $30 million in revenue. Roughly 15 percent of its sales now comes from outside of the U.S.
To be sure, the move is likely to boost Facebook's own revenue if the company is successful in signing on new businesses. Facebook topped $17.93 billion in sales last year, up by 44 percent from 2014, thanks to its continued push for mobile content. (The company declined to comment on what percentage of its total sales small business clients account for.) And while attracting customers is certainly a major challenge for businesses looking to expand abroad, the new features do little to help them overcome other formidable challenges, such as navigating government red tape, forging strategic partnerships, or discovering new sources of capital.
Catch up on my current posts along with industry articles