How to use Facebook Marketplace Ads to Grow Your Business – A Simple Guide

Facebook Marketplace was first launched in October 2016, providing an online platform for users to trade new and used goods within their local community. As of 2022, Facebook Marketplace is now available in 222 countries, independent regions, and territories, making it accessible for eligible users to purchase or sell various products. The extensive global presence of Meta as a commercial platform has made it the preferred choice for marketers to increase their brand’s sales and conversions.

What is Facebook Marketplace?

Facebook Marketplace is an online platform where users can buy and sell within their local community. Before presenting this feature, users purchased and sold things on buy-and-sell Facebook groups. This feature was developed based on the exact principle but with the option to list items for sale, search for items to buy, and mark items as sold.

The Facebook Marketplace interface presents a complete shop-like feature that links users directly with the product they want to buy or sell. 

Facebook doesn’t facilitate sales transactions. But, it delivers a place for sellers to advertise their products without getting involved in price and shipping processes between buyers and sellers.

With Facebook Marketplace, businesses can:

  • Display different retail items like vehicles and homes. 
  • Advertise store products on the Marketplace to increase sales. 
  • Showcase new or used items from the Facebook Shop for free.

Who can sell on Facebook Marketplace?

Facebook Marketplace is an online platform that allows anyone to sell their items, regardless of whether they are new or used. It is designed to cater to various businesses, such as e-commerce companies, entrepreneurs, artisans, fashion firms, and real estate agencies.

The platform provides features similar to those found in Amazon and eBay marketplaces. But here, advertisers don’t pay to list their products or services on Facebook. 

Its components are identical to those of the Amazon and eBay marketplaces. But here, advertisers don’t pay to list their products or services on Facebook. There is only one fee to pay. When a customer orders your product, you’ll have to pay 5% (or $0.40 minimum per order) of the product price after shipping the item. 

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How to create an Ad for Marketplace

Creating an ad in Meta Ads Manager can appear in Marketplace and reach more people.

To create an ad for Marketplace:

  1. Go to Ads Manager and choose your objective. Then, click Continue.
  1. Select other settings based on your objectives, such as your conversion location or performance goal.
  • If you select the awareness goal, select Ad recall lift, Reach, Impressions, ThruPlay, or Two-second continuous video views as your performance goal.
  • If you pick the engagement objective, select On your ad as your conversion location and select Event responses or Video views as your engagement type. You can also choose Messaging apps as your conversion location.
  • Select a Website or Messaging app as your conversion location if you chose the sales objective.

3. Choose your Audience and define your targeting.

4. Choose Advantage+ placements or Manual placements.

  • It’s recommended Advantage+ placements. If you choose Manual stations, remember that Marketplace isn’t available as a single ad placement, and your ad campaign must include Feed.

5. Set your Budget and Schedule. Click Next when you’ve finished.

6. Choose your ad’s creative format.

  • The suggested video and image specs are the same as Feed. Remember that you can’t crop or upload unique creative for ads in Marketplace.

7. When you’re finished setting up your ad, click Publish.

Advantages of using Facebook Marketplace for businesses

Facebook offers incredible marketing prospects with over 3.03 billion monthly users, of which 2061 million are daily active users on Marketplace. 

  • Offering different marketing tools

The Facebook Marketplace provides a unique set of tools advertisers can use to incorporate personalization, optimize for mobile, and create impactful ad campaigns. You can also implant Facebook marketplace ratings on your website and utilize it efficiently as an advertising tool for your business.

Businesses can also use marketing automation tools to reply to users’ queries automatically or facilitate communication-based on their CRM segments. 

  • Facilitating one-on-one sales to prospects

It allows businesses to sell to buyers directly and communicate one-on-one through Facebook Messenger. Future buyers can reach you now, and you can respond to them in real-time. This helps you give them the required product details before they lose interest.

  • Accepting versatile payment methods

Facebook does not provide sales transaction services in the Marketplace. Businesses can utilize any payment process, such as PayPal, bank transfer, Shopify, and BigCommerce payment processors. 

  • Allowing to list products for free

Facebook Marketplace is free for all businesses to list and manage products. You can list your products in minutes and begin selling, which allows you to streamline the conversion funnel and increase sales.

If you already have a Facebook shop, you can link it directly with your Marketplace and get more conversions.

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What to sell on Facebook Marketplace?

Are you looking to sell items on Facebook Marketplace as a business? Before you start, know what’s allowed and what’s prohibited. Here’s a list of things that Facebook doesn’t permit for sale:

  1. Adult products
  2. Alcohol
  3. Animals
  4. Body parts and fluids
  5. Digital media and electronic devices
  6. Documents, currency, and financial instruments
  7. Gambling
  8. Hazardous goods and materials
  9. Human exploitation and sexual services
  10. Ingestible supplements
  11. Jobs
  12. Medical and healthcare products
  13. Prescription products, drugs, and drug paraphernalia
  14. Products with overtly sexualized positioning
  15. Recalled products
  16. Services
  17. Stolen goods
  18. Digital products and subscriptions
  19. Tobacco products and related paraphernalia
  20. Weapons, ammunition, and explosives

You can sell any product not included in the list of prohibited items. As for the permitted items, they are categorized differently depending on the type of product. Choosing the best categories makes locating your product easy for users and the Facebook marketplace’s algorithm.

Facebook Marketplace categories

When posting on Facebook Marketplace as a business, the listing categories significantly affect your conversion rates. An appropriate listing permits you to target the right audience with higher accuracy. 

  1. Deals
  2. Clothing & Accessories
  3. Classifieds
  4. Electronic
  5. Entertainment
  6. Family
  7. Hobbies
  8. Housing
  9. Home & Garden
  10. Vehicles
  11. Home sales

How does Facebook Marketplace work?

Facebook Marketplace simplifies product categorization. Sellers list items in their location. When users explore, the algorithm uses their profiles to specify their location. 

Then, it gives them items associated with their search query available in the vicinity. Buyers select and contact sellers on Messenger and agree on payment and delivery. Take any automotive as an instance. The automotive company has listed its cars for sale on the Marketplace. A prospective buyer selected the desired vehicle and agreed to meet with the dealer. 

That’s what Facebook Messenger aims for—offering a free service that makes it easy for businesses to do transactions without exchanging addresses or phone numbers.

Facebook Marketplace algorithm

Below is a concise explanation of how Facebook Marketplace’s algorithm operates:

  • For buyers, it suggests visually similar items using computer vision (Meta’s AI is used to analyze and recognize visual elements in images). The platform can translate the listings into the buyer’s preferred language.
  • Sellers acquire tools for more manageable listing creation, including auto-recommendations for categories and pricing. There are other tools as well. For instance, an in-app image enhancement tool helps improve uploaded pictures.

Ideally, the algorithm displays products that buyers have searched or viewed. Optimizing your listings with relevant tags and search-friendly descriptions is your job as an advertiser.

How can I add tags to my listings on Facebook Marketplace? 

Counting tags to your items increases your items’ visibility, making it easier for curious buyers to discover them. Clarifying and relevant tags to your listings can attract more views and increase the likelihood of sales. It can help you efficiently manage and track your inventory by allowing you to organize and categorize your listings.

If you want to add tags on Facebook Marketplace, you can easily do so by following these simple steps:

  1. Tap on “Create New Listing” on your Facebook Marketplace homepage.
  2. Type in the details of the item you are selling, such as title, description, and price.
  3. Scroll down to the “Add Tags” section and click on the box.
  4. Add relevant keywords or phrases that describe your item. Facebook will suggest some popular tags as you type.
  5. Click on “Add” to incorporate the title in your listing.
  6. You can add up to three titles per item on Facebook Marketplace.

How to list products on Facebook Marketplace

Consistently list your products so users can visit them on the Marketplace, News Feed, and other appropriate places on Facebook. Also, you must read the Facebook community standards. Then, obey this step-by-step process to list your products.

1. On the News Feed, tap on Marketplace.

2. Proceed to Create a new listing from the menu under Marketplace.

3. Pick the product you want to list from the options provided, i.e., Items for sale, Vehicles for sale, and Homes for rent. We’ll use the “item for sale” option for this example.

4. On the next page, pick your product category, select what you want to sell, select the price and location, and deliver a product description. You can also count up to 10 product images. Click Next to proceed.

5. Click on Publish to publish the listing in the Marketplace. Recall that you can list your product in more than one place.

Great news! Your products have been successfully listed on the Facebook Marketplace. This means that potential buyers can now find and purchase your products. To access your store, click the shop tab on your Facebook business page. 

While listing your products on the Facebook Marketplace is a great way to reach potential customers, you can also consider using Facebook Ads to increase visibility and drive more traffic to your store. Facebook Ads can help you get a wider audience and convert more sales.

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Pro Tips for Successful Advertising on Facebook Marketplace

Set a reasonable price.

Setting a price is one of the trickiest decisions when calculating how to sell on Facebook Marketplace. Though you certainly want to make as much money as possible, defining a reasonable price is essential to ensure that your item sells promptly. An important rule is to list items at 50% or less of their retail price. It is also recommended to check out similar items in your area to compare prices and competition.

If you want your ads to perform better, you may undercut the current market by pricing your item below comparable listings. Or, feel free to set a little higher price if you believe your item is of better quality than identical products currently listed and contain details in the item description that define what sets your listing apart.

Put high-quality photos for your Facebook Marketplace listing.

One of the best patterns to confirm your item sells quickly is to take high-quality photos to attract potential buyers and let them notice what it looks like. Place the item in front of a plain background and reduce distractions to ensure focus on the item. Take photos from different angles to provide a broad picture for interested parties.

Take benefit of natural light by placing the item before a sunny window. Simultaneously, try photographing outdoors in a shady area to avoid harsh shadows. Turn off overhead lighting indoors to maintain the colors as naturally as possible. Feel free to utilize an app to brighten the photos. While taking pictures on your phone for selling on Facebook Marketplace is fine, images with a DSLR camera will stand out.

Make sure that you’re delivering an exact image of the item. If it’s damaged in any way, click clear photographs of the impacted areas so buyers can see the size of the damage.

Provide a detailed description.

Offer as many details as possible about the item upfront to reduce the back-and-forth you’ll have to do fielding questions from potential buyers. If the information is available, include details about the brand, manufacturer, and model number. Provide accurate measurements and relevant information on the item’s condition, including flaws and signs of use.

Be honest when describing the item, particularly regarding size, place of origin, and condition. You’ll only be wasting your time—as well as the buyer’s—if the item doesn’t match the description at pickup time.

Respond to inquiries quickly.

Facebook Marketplace transactions tend to move quickly, so monitoring your messages closely when you have an item listed is essential. Reply to interested parties as soon as possible to reply to questions or negotiate on price. If you don’t respond to queries within 24 hours, potential buyers may have already bought a similar item from another seller.

Be willing to negotiate. 

Potential buyers are expected to negotiate a bit on Facebook Marketplace. Consider your bottom line before setting the price, and be ready to negotiate if interested parties propose an amount a little lower than the listed price. It’s usually best to be loose and accept reasonable offers instead of waiting a few more dollars. If you select to list your item at the lowest price you’re willing to take, make it precise in the listing that the fee is non-negotiable.

All in all 

Utilizing Facebook Marketplace Ads presents an advantageous avenue for business expansion. By leveraging this platform virtually, companies can boost their visibility, target specific demographics, and foster direct engagement with potential customers. Employing compelling visuals, precise targeting, and engaging ad content helps you to build a robust customer base for your brand. Integrating these strategies into a comprehensive marketing approach on Facebook Marketplace can drive businesses toward sustained growth and success.

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