Benefiting again from a continued surge in mobile advertising, Facebook last week said fourth-quarter Ad revenue growth was up, 76% from a year ago. During the Q4 conference call, COO Sheryl Sandberg noted that the jump in ad revenue as well as the first-ever billion-dollar mobile revenue quarter was more than all the previous year’s revenue combined! She also outlined three key drivers behind the mobile advertising business:

• Strong mobile engagement: Marketers are starting to shift their budgets to reach people on their phones, and that was especially apparent during the holidays of 2013.
• Strength across four advertiser segments: Direct-response advertisers, small and medium-sized business, developers, and brand marketers, especially consumer-packaged goods companies are all jumping on the bandwagon.
• Product development: Making advertisements as useful as other content allows for firms to reach customized audience segments

This is the biggest shift in marketing in generations and companies need to adapt. But how?

The Wishpond Blog came up with several ideas for small businesses in The Science of Optimizing Your Facebook Advertising Campaigns

Know Your Goal Before You Start.

Before you start your advertising campaign, you need to decide on your goal and find the proper metrics to track your progress toward it. Facebook is nice enough to ask you what your goal is before you start creating your Ad, so make sure you’ve decided on your own goal before choosing one from the list at the start of the “Create Ad” page.

Create Smaller Audience Segments.

One of the keys to optimize your Facebook Ads is finding the right target audience. To do this, you need to make sure that your Target Audience’s don’t overlap, or you’ll be showing the same Ad multiple times to the same people. This will not only skew your results, but be very spammy to your audience.

Monitor the Right Performance Metrics.

The one metric you NEED to focus on is your average-value-per-customer minus Cost-Per-Customer. At the end of the day you should only make changes and tweaks to your Facebook Advertising campaigns based on that one metric, not on anything else.

Use Custom Audience and Look-A-Like Targeting.

Custom Audience Targeting allows you to show Ads to specific people on Facebook based on their email address or phone number. Simply upload a list of email addresses or phone number and Facebook will match them to their user ID on Facebook, making sure only they see your Ads.

Look-A-Like Audience Targeting.

A lookalike audience is exactly what it sounds like; an audience of users generated by Facebook that best-matches your imported email or phone number list. Facebook examines demographics like age, gender and location; as well as precise interests and broad categories of your Custom Audience list. And then an algorithm within Facebook matches those demographic details with existing Facebook users. It then finds the best possible match for your next ad.

Keep It Short & Simple.

The longer your Ad on Facebook, the less people will read it. A recent study found that Facebook posts with 80 characters or less receive 66% higher interaction rates than longer ones. If you want to go even shorter (around 40 characters in length) you’re looking at around 85% engagement.

Rotate your Ads.

Do you ever notice that your Facebook Ad’s click-through rate (CTR) starts going down after a few days? This is because your Ad is being continuously shown to the same target audience over and over again To combat this “Ad Fatigue” you need to change your Ad, or rotate it, to keep it new and fresh for your target audience. Rotate different headline copy, action words, image background colors, etc. The Ads don’t need to be drastically different, just enough to not look the same at a quick glance.