There's a brave (and perhaps naive) engineer. I think you'll find this audience a bit skeptical, but there's a bigger issue. If people are paying FB for relationships with people that want to be engaged with a product, they will quit paying as soon as the ROI is proven to be negative. And I think you'll only get one chance! If you honestly think the guy with the $20k ad spend is going to "try again just to make sure", then I think I'll go short some FB stock before it takes it's final dive.
This isn't a problem you face alone ... and I think it's telling that Google has had to put more ads on each page to grow revenue. In their case, the ads are targeted to the user AND often are related to a product search. I think FB has a bigger problem because people didn't go there to search for a product but rather to engage their network.
You sound like somebody who hasn't done that much search engine marketing. You can lose $20k on google in the blink of an eye and have nothing to show for it but clicks and exit-pages. Some of this may truly be Facebook's problem, I don't know, I personally doubt it. But no, if one negative-ROI campaign led people to abandon Google, they'd have no advertisers left, either. So I think your premise is flawed.
FYI, as the $20k guy, the money wasn't spent all at once. We fiddled, we tried, we failed, several times, miserably. We've made mistakes on Google as well, but success was more easily achieved.
So, despite being certain that our target audience is on FB, we have concluded that we're better off advertising in a place where the intent to purchase a hotel room/travel is clearly present (ie google search).
It's a specific situation, certainly not true for all advertisers. I'm sure that FB advertising for other products might work quite well. It's just not for us.
> If you honestly think the guy with the $20k ad spend is going to "try again just to make sure", then I think I'll go short some FB stock before it takes it's final dive.
That person has already replied with more info on his case, but you should also note that for some people $20k is big enough to never risk that mistake again, while for others it really isn't. I spend around that much each month on Facebook and that's a "well we'll put a little into FB" amount in the scheme of things. Sure, I've had other clients for whom a badly spent $1k was a problem, too. My point is to not jump to assumptions that an adspend is big because it sounds big to you.
(He'll, just this morning I sent a mail to a video website saying that a $15k spend delivered shit results and that we should try again.)
This isn't a problem you face alone ... and I think it's telling that Google has had to put more ads on each page to grow revenue. In their case, the ads are targeted to the user AND often are related to a product search. I think FB has a bigger problem because people didn't go there to search for a product but rather to engage their network.
Good luck