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American Express has already shown its commitment to business owners and social media through its OPEN forum, a community of small business owners and Amex business cardholders, and its social currency program.
The next phase in American Express’ social media efforts involves a partnership with Facebook.
American Express Card Members can redeem their rewards points to pay for Facebook ads, at a rate better than one dollar per 100 points (the standard exchange rate for most rewards.) Instead, 6,750 points buys $50 in Facebook advertising.
While this amount would not represent the entire Facebook ad budget for most companies, it can take a bite out of your monthly ad budget or could help business owners test the waters with Facebook advertising. It’s likely this scenario is what Facebook is banking on — business owners will spend $50 in advertising, which could represent a few days’ worth of ads or more, see a return-on-investment, and keep the campaign going.
You can pay for ads based on CPC (pay-per-click) or CPM (pay per impression, conventionally known as cost-per-thousand [impressions]). You place a maximum bid to let Facebook know how much you are willing to pay (per click or impression) to have your ad appear over your competitors’. You might pay less than your maximum bid for a particular space, but you will never pay more.
Facebook also helps you control your advertising budget by permitting you to set a daily budget, daily spend limit, and lifetime budget (for a single campaign). What’s the difference between a daily budget and a daily spend limit?
Your daily budget is the maximum amount you’ll be charged for one day of advertising; the campaign will stop for the day once you reach that budget amount. On the other hand, the daily spend limit is the maximum amount you can spend across all campaigns in a given day. This amount is re-set at midnight in your time zone. The daily spend limit may be limited by the money you have in your account, but adding more money to your account can bring the limit back up to the amount of all your daily budgets across all your campaigns.
The Lifetime Budget is the amount you are willing to spend for the entire life of a single campaign.
If you run a high-revenue, high-cost business, and use your Amex card to pay your payroll company each pay period, along with using it for utilities, corporate travel, rent or lease payments — virtually, all your expenses — you could cash in all your rewards points to pay for all your Facebook advertising campaigns.
Use American Express’ online tools to calculate your regular monthly expenses and rewards points earned and then set up budgets and spending limits based on those amounts. Redeem points through AmEx OPEN’s Facebook page or through the Membership Rewards program website.
If you are a smaller business owner and don’t accumulate 6,750 points or more monthly, it may be a good idea to redeem your points to test Facebook ad campaigns. Then, use your Amex card to buy more Facebook advertising, and redeem those points to further increase your ad budget.
Online advertising through Facebook is easy and doesn’t cost a lot of money, so it’s a great way for beginning Internet entrepreneurs or larger businesses to reach their target market. And now American Express makes it even easier.