Facebook Metric to Revenue Centric: Measuring Success with Facebook Ads

facebook advertising

Is your Facebook advertising really working for you? How’s your CPL looking? How about your CPA? And CTR? First, let’s take a step back…What actually defines success in this area?

That’s exactly what we’re going to explore. We’ll go through setting yourself up to measure and understand the success of your Facebook ad campaigns in six simple steps, so you can be confident you’re getting a real return on investment from them. Let’s begin.

 

1. Align Your Business Goals To Your Marketing Goals

It’s common for lead quality to fluctuate when it comes to Facebook advertising as there are so many factors involved. That’s why it’s crucial to understand AND measure your costs when embarking on advertising campaigns in this space.

The first step is to understand what your business is willing to outlay for each cost-per-lead (CPL) and cost-per-sale (CPS), taking into account onboarding costs, the conversion rate of similar leads and initial profitability. You’ll also need to consider the lifetime value of the customer, which is a factor which we commonly see left out of business’s assessments and strategies despite its importance in assessing returns.

 

2. Set The Foundations For Tracking Success

How do you know what’s working and what’s not working in your Facebook ad campaigns? Tracking is key. Embarking on Facebook advertising (or any other online marketing initiative, for that matter) without fundamental tracking is not a good idea.

If you haven’t set up your tracking correctly yet, this is where you should be focusing first so you can be sure where your true marketing value lies. This is where we turn to our resident Head of Production here at Rocket Agency, Mr G Viner.

“Ensure that you are using UTM tagging when setting up campaigns which send traffic to your website. Make sure that you’ve set up your Facebook Pixel properly on every page, including the addition of Conversion events against goals you want to track and essentially define as a lead. A great resource to assist in the process of setting up your Facebook Pixel is the Google Chrome extension, Facebook Pixel Helper.”

 

 

facebook-pixel

 

3. Work On Your Relevance Score

Relevant you shall stay. And rewarded you will be. – Yoda

The more relevant your advertising is to its target audience, the more powerful it’s likely to be. Once your ad is viewed a minimum of 500 times it will receive a daily relevance score out of 10. Note, Daily. The higher your relevance score, the less you’ll pay to reach your intended audience. This is why it’s important to set the right campaign objectives and ensure your ad copy resonates with your audience with regular monitoring of your relevance score.

Here are some example ads with relevance scores provided by Facebook

 

facebook-relevance

Source: https://www.facebook.com/business/a/ads-relevance-score

A few key considerations to take on board:

  • Is your target audience as specific as possible?
  • Does your ad copy appeal to the needs and problems of your audience?
  • Have you created additional ads, and are you refreshing your ads when relevance score dips?
  • Have you split tested your ads against different targeting options to drive up your relevance score?

relevance score

 

 

4. Consider Your Cost-Per-Lead Vs. Cost-Per-Action

What you refer to as a ‘Lead’, Facebook may refer to as an ‘Action’. This will come back to what you have defined as your Conversion measurement. Ensure that your Conversion events are properly set up via Facebook Pixel, otherwise you may be seeing and making decisions based on inaccurate data.

Remember, your CPL alone does not provide enough context to determine success. This takes us to the next step…

 

5. Keep An Eye On Your Ad Frequency

Frequency in Facebook terms refers to the average number of times your ad has been shown to an individual. With a relatively small and defined audience size, Facebook will start to show your ad multiple times.

The best advice we can give is: keep a close eye on your metrics. As ad frequency increases, check your CTR, your CPC and CPL. These are all metrics you want to be utilising when making decisions on optimisations, whether it be changing your audience pool, rotating your ads, refreshing your creative or even changing your ad schedule for maximised performance.

 

facebook frequency

 

 

6. Watch Revenue In Real Time

Revenue is a metric that can be measured directly in your Facebook Ads manager platform if a value is defined within your Conversion event. This is mostly applicable to ecommerce stores, however it can also apply to a number of other businesses. If you provide a service, you will want to be extracting this information from your CRM platform as an accurate reflection of your returns.

We’ve looked at defining and understanding your CPL, CPA, setting up tracking, analysing relevance score and frequency. So, are you generating positive ROI from your Facebook marketing initiatives?

It’s important to understand that each individual metric mentioned above does not represent success in itself. However, a combination of improvements across the board with a lower cost-per-sale than your benchmark are vital signs of success.

 

If you’d like a helping hand to optimise your Facebook campaigns, get in touch with the Rocket team today.

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