Facebook ads are (still) the most effective and cost efficient forms of digital advertising available to large and small companies. There is nothing surprising about this. First of all, Facebook is the largest social network by number of monthly active users: 2.4 billion. Secondly, it has become a platform that attracts mostly adults. Teenagers and young adults are moving towards new platforms like TikTok, which focus on video content and creative filters.
Thus, Facebook marketing remains one of the key strategies for marketers and business owners all over the world. But it does not mean that it works like magic, and that you cannot go wrong whatever you are doing. There is a lot of competition, influencing the value of the bids for Facebook ads. And users are developing banner blindness – unconsciously ignoring ads as they scroll down their newsfeed.
How Can Marketers Measure the Result of Facebook Ads?
Facebook was the first social network to start monetising its platform and over time has developed useful tools for its business users. The Facebook Team understood that it has to give something for the money they charge for ads. Thus, the many tools and metrics available to marketers help them monitor and optimise their Facebook ads.
The problem is that you get so much information in the Facebook Business Manager panel, that you may get lost in it. Also, many marketers and business owners fall victim to the so-called vanity metrics. These are the really big numbers: likes, impressions, or reach. But they mean very little if you keep spending money on Facebook ads without getting measurable results: subscribers and sales.
Focus on Metrics that Really Matter
So, what are the metrics that you should analyse if you want to calculate the success rate of your ads on Facebook? Here are the most important ones:
1. Ad Frequency
Ad frequency is something you should worry about if you are running campaigns over a long period of time (weeks). This metric measures the number of time your ad was shown to the same users.
A high ad frequency is a problem for two reasons. One, you keep spending money without getting your ad in front of new audiences. Two, some users may hide or report your ad and this represents negative feedback. Facebook may take action on this kind of negative feedback by stopping your ads from running or even disabling your ads account.
2. Cost per Click (CPC) and Click Through Rate (CTR)
These two metrics should be measured together, even if only one pertains to Facebook ads. CPC means how much you pay for each click on your ads. CTR is the number of clicks on your website after users saw your ads.
A high CPC is justified only by a high CTR. If your spend on Facebook ads is high, but you get few clicks, this means that something is wrong. Either your ad copy is not on point, and people do not respond to it, or you selected the wrong audience for your ads – people who are not interested in your products and services.
3. Cost per Action (CPA)
Many marketers put all their faith in the conversion rate as the key metric that never fails. While it is great to have a good conversion rate, the question is: at what cost? The CPA solves this issue.
Thus, if you have an ad set with a high conversion rate at a high CPA and another ad set with medium conversion rate and low CPA, the second ad set is more successful. For better context, you should also compare CPA with ad frequency and total ad spend for your Facebook ads.
4. Return on Ad Spend (ROAS)
In order to analyse this metric, you need to have the Facebook Pixel installed on your website and to add the events you want to track, such as purchase, add to cart, add to wishlist, etc.
At the same time, you must ensure that the Facebook Pixel tracks the value of the purchase made by the customer. After you completed these actions, Facebook will calculate automatically the ROAS for your ads. If the value is positive, then you’ve made more money from purchases than spent on Facebook ads.
5. Conversion Rate
This metric will give you the percentage of website visitors that convert to customers. It is a valuable metric for any type of campaign you are running. Even when you are very busy and do not have time for the more complex analyses presented above, make sure that you are always monitoring the conversion rate.
For example, for Facebook ads with the sale objective, all you have to do is calculate how many sales you made. For the traffic objective, the number of visits to the website will help you calculate the conversion rate from the total ad impressions.