Facebook’s pitch to brands has always been to increase customer engagement. Create a page with a stylish cover photo, recruit a fan base, engage your audience, consistently post original, authentic content, etc, etc. Be more open. Be more connected.

But recently Facebook has been shifting its traditional marketing narrative to a conversation around sales. In the past six months we’ve seen Facebook evolve its suite of ad products to direct response ads units and sales conversion tools with a focus on customer acquisition strategies in high demand by e-commerce, travel, and media customers.

A recent case study by up-and-coming, New York based e-commerce company Fab.com is probably one of the most indicative examples of the influence Facebook can have on the bottom line. Here are four lessons that all ROI focused brands can learn from the Fab.com case study:

Targeting works

Facebook allows a level of targeting that Google can’t offer.  Ads can be targeted by demographic, gender, age, and interests.  “In terms of paid advertising on Facebook, what we try to do is hone in on product images that are going to elicit an emotional response from people.   We can literally take everything in our catalog, and narrowly target it to our customers.”

Mobile ad units drive acquisition

Fab.com was an early adopter of the “apps you may like” mobile ad unit on Facebook. “Mobile has a much higher conversation rate for us. We’ve been working with Facebook, most recently, on getting mobile downloads. We’re off to a good start, it’s been about 5 times more effective than other mobile channels that we’ve used.”

Conversion tracking and ad optimization works

Fab.com was also an early user of the new Facebook conversion tracking tool, which more accurately shows where sales conversions originated from. “Online retailer Fab.com was able to reduce its cost per new customer acquisition by 39% when it used conversion measurement and optimization to serve ads to consumers deemed most likely to convert.”

Custom Audience allows even better targeting

Facebook’s new custom audience tool offers “some of the best targeting available on or offline today,” according to Sheryl Sandberg. Fab.com targets their “purchasers on Facebook, and not surprisingly, they have a 10x propensity to come back and purchase from us than a generally targeted user.” That’s an amazing example of the value of cross-referencing a customer database with a Facebook fan database.

Facebook advertisers have long complained that Facebook ads under-perform. If fact the SocialFresh Facebook ad survey revealed that 45% of respondents identified ROI as their biggest Facebook ad challenge. But Facebook has responded. And quickly. As seen by the Fab.com case study, advertisers can prove on ROI on Facebook with the right ad units, hyper-targeting, and with ad optimization.

About the author

Dave is senior strategist at Septeni APAC and is based in Singapore. Septeni is a Japanese digital agency that has optimized over 300 Facebook ad campaigns since July 2010. You can reach Dave at dave@septeni.com or on Twitter at @dave_sloan.

Image Credits: smallbiz technology