Small Business Social Media Advertising: Local shop conducts value proposition testing with Facebook ads

THE CHALLENGE

A shoe repair shop in Blagoevgrad, Bulgaria, faced the same challenge as many other small, local businesses the world over — it didn’t have enough customers. The shop decided an online presence could help them overcome that challenge and hired value proposition consultant Metodi Iliev.

Step #1: Establish an easy online presence

Establishing an online presence and getting noticed can be difficult for a small local business. But there is an easy way small businesses can get online that requires no coding, and it started generating customer interest pretty quickly for the shoe repair shop.

The first thing Iliev did was to establish an online presence by creating a business page on Facebook: Shoe Repair in Blagoevgrad — Liuben Kambitov. Without any paid ads, the shop started getting contacted by customers — a woman sent pictures of her damaged sneakers, a man asked about the store’s hours.

“Surprisingly, Google ranked us #1 on the search engine results page for the keyword ‘обущар в благоевград,’ meaning ‘shoe repair Blagoevgrad,’” Iliev said.

 

Google SERP page for “shoe repair Blagoevgrad”

Lest you think that creating a Facebook Business page is an easy SEO tactic for a small local business that would only work in Bulgaria, I ran a similar search here in Jacksonville. A simple Facebook Business page with only nine likes was good enough to claim a top 10 ranking (#7 for “Edgewood Shoe Repair — Jacksonville, Florida — Footwear Store”). And Jacksonville is a significantly bigger city than Blagoevgrad (population of 892,062 versus 77,411).

 

Google SERP page for “shoe repair Jacksonville”

 

The organic traffic was just the beginning. Iliev wanted to attract more customers by using paid ads. “But first I needed to identify what value will be in those ads. Otherwise, it would be just wasting money,” he said.

Step #2: Understand value proposition methodology

Iliev had taken the Value Proposition Development on-demand certification course from MECLABS Institute (parent research organization of MarketingSherpa).

“During the sessions, the instructors helped me focus my attention and marketing energy only on the important aspects of finding and communicating the offer. Thus, I save time and energy every time I start to use the value prop heuristic for a new business. It's so helpful to me! After taking the course, I felt like I had years of experience practicing marketing, although I really didn’t. I think this is because of the years of research and practice MECLABS put into this course and the heuristic,” Iliev said.

Step #3: Discover most effective value prop by testing in Facebook ads

Iliev used the five-step value proposition process to create two value prop arguments. One leveraged the experience of the craftsman who owned the shop. The other leveraged the convenient location and then conducted testing with Facebook ads to determine which value proposition would be most appealing to customers.

“I used what I learned in the course to try and make my message succinct with the value prop in the first words. I also tried to create credibility by communicating numbers, like years and distance. Also, I combined the value prop heuristic with the conversion heuristic by trying to prevent friction and anxiety. Additionally, I used the ad heuristic, which suggests having a grabbing headline and CTA for each ad. I think the heuristics work better in combination,” he said.

He also took into account the main lesson he’s learned from his experience about the difference between Google search ads and Facebook ads — people on Facebook do not want to see the product, while people on Google do want to see the product.

Iliev ran three tests using different ad delivery methods on Facebook.

Test #1: Facebook ad delivery optimized for post engagement

The KPI (key performance indicator) for the first test was post engagement.

The optimization for ad delivery setting used in Facebook was also post engagement: “We’ll deliver your ads to the right people to help you get the most likes, shares or comments on your post at the lowest cost.”

Treatment #1’s value proposition focused on experience

Translation of Treatment #1:
Quality Shoe Repair 30 years of practice in the repair of ladies’, men’s and children’s shoes.
See where it is. (Google Maps link)

 

Treatment #2’s value proposition focused on location

Translation of Treatment #2:
Convenient Location
The shop is in the center of Blagoevgrad — 30 meters* from the “Mosque” stop.
Get fast with a car or with a bus №2. See where it is. (Google Maps link)
*distance is approximate”

Test #1 Results

Treatment #1 (experience) outperformed Treatment #2 (location) with a 60% higher post engagement rate. This test was statistically significant at a 99.9% level of confidence.

Test #2: Facebook ad delivery optimized for impressions

In Test #2, the KPI (key performance indicator) was also post engagement, but this time the ad delivery setting used in Facebook was impressions: “We’ll deliver your ads to people as many times as possible.”

The same creative used in Test #1 was used for the treatments in Test #2.

Test #2 Results

Treatment #1 (experience) outperformed Treatment #2 (location) with a 34% higher post engagement rate. This test achieved a 91% level of confidence.

Test #3: Facebook ad delivery optimized for link clicks

In Test #3, the KPI (key performance indicator) was link clicks driving traffic to a website — the URL took people to the Google map position of the shoe repair shop.

The optimization for ad delivery setting used in Facebook was link clicks.

After Test #1 and Test #2, Iliev saw that experience was outperforming the location. However, he wanted to make sure those results were from the value proposition itself, and not just that specific expression of the value prop.

“I still didn’t believe the experience was a stronger value prop than the location, so I set a new test,” Iliev said.

He changed the headline of the location ad, trying to make it stronger by being more specific. He also added “A blue area is nearby.” “I don’t know how it is in the US, but in Bulgaria we have streets where you can park for one hour and pay a small tax. I thought that could make the location value prop stronger, so that people will [feel assured] they would not have any problems with the parking,” he said.

Iliev also changed the image from Test #1 and Test #2, with both treatments having the same image.

 

Treatment #1’s value proposition focused on experience

Translation of Treatment #1:
Quality Shoe Repair 30 years of practice in the repair of ladies’, men’s and children’s shoes.
See where it is. (Google Maps link)

 

Treatment #2’s value proposition focused on location

Translation of Treatment #2:
Ideally Located In The City Center
The shop is in the center of Blagoevgrad — 30 meters* from the “Mosque” stop.
Get fast with a car or with a bus №2. A blue area is nearby. See where it is. (Google Maps link)
*distance is approximate

Test #3 Results

Treatment #1 (experience) outperformed Treatment #2 (location) with a 69% higher clickthrough rate. This test was statistically significant at a 99.8% level of confidence.

LESSONS LEARNED

In each of the three tests, the experience of the craftsman outperformed the convenient location of the shop. Potential customers found a quality shoe repair to be a more appealing value proposition than a convenient shoe repair.

Now that he knew which value proposition was most effective, the business owner had a reason to start spending money on ads and knew what value proposition the shop should communicate in all of its marketing collateral.

In all, Iliev spent just $16.72 on Facebook Ads and was able to run three tests with a level of confidence of at least 90%. He was fortunate to have costs per result that were likely several orders of magnitude less expensive than many readers of this case study will be able to purchase ads for.

Another caveat readers of this case study should consider is a validity threat in assuming that other audiences will behave in the exact same way that people on Facebook did. This type of validity threat is known as a selection effect, meaning the sample selected may be unrepresentative of the actual audience. For example, people who read newspapers may behave very differently than people who respond to Facebook ads.

That doesn’t mean you can’t test a value prop on Facebook and then apply it elsewhere. In a perfect scientifically driven world, you would test your value proposition separately on every channel you use to connect with customers. But that isn’t possible for most businesses, and certainly not the small business. So just be aware of this possible validity threat, and monitor your results closely.

One way Iliev tried to make sure his value proposition discoveries were accurate was by keeping the ideal customer the same and seeing if the results varied by different types of ad delivery options Facebook provided. “Target the same audience in each test. In my case, I targeted people in the town interested in shoes. Try to test different campaign goals, and compare those results before making the final conclusion,” he said.

While this type of value proposition testing can be done at different levels by any size company, the focus for this particular case study was discovering a value proposition to help a small business find clients. Major enterprises have no shortage of experienced internal marketers and external agencies to help discover a value proposition, but it’s easy for the small business owner to overlook this crucial step.

“You have to be realistic about what you can do for customers, and you need a strong value prop. It can evolve through time, but you need to put some effort into crafting the best version you can. Target people near your brick and mortar business. Or, if you are selling online, start with testing on small audiences,” he advised.

While this was an interesting experiment for Iliev and for the readers of the case study, I wondered what someone less versed in marketing experimentation thought of it — namely, the owner of the shoe repair business.

“He is happy because of the new clients,” Iliev said.

RELATED RESOURCES

Value Proposition Development on-demand certification course (from MECLABS Institute, parent research organization of MarketingSherpa)

The MECLABS Value Proposition Toolbox

How to Test Your Value Proposition Using a PPC Ad

Value Proposition: How to use social media to help discover why customers buy from you

PPC Marketing: Testing value proposition messaging increases clickthrough 88%

SOURCES

Metodi Zhivkov Iliev

Shoe Repair in Blagoevgrad – Liuben Kambitov