In almost every marketing office or advertising agency, there’s an elephant in the room. We try to ignore it, make up excuses for addressing it “next time”, or even attempt to hide it entirely.
This elephant goes by many names, but we’ll call it for what it is: Poor Ad Performance.
Whether it’s a negative ROI for your small business or a cost per click that makes your client cringe, it all boils down to the essentials: your metrics.
We avoid talking about this elephant because it indicates, at some level, that you don’t know what you’re doing. Or worse, that you’re actively doing something wrong. Tracking the right metrics and improving your ads accordingly is no small challenge.
But with the right incentives (i.e. PRIZE) in this post, we have a feeling that you or your team are about to kick this elephant’s ass back to the jungle.
Ready for the Challenge?
You have 14 days.
- Log into your Ads Manager (or AdEspresso) and review the eight metrics we suggest below.
- Choose ONE metric, and take 2 screenshots (with dates) so you can show a BEFORE and AFTER improvement!
- Share your findings by posting it on the AdEspresso Facebook page, Tweeting us the image @AdEspresso or using the Twitter hashtag #AdEspressoContest with your image for your chance to win.
- Keep you finger crossed (while you see your own ROI grow)!
- Contest ends September 5th, 2016!
And the prize? What do you win? *drum roll*
$50 Facebook Ads Coupon (yup, 50 dollars cash to use for your ad spend) and we will post you as the winner of our challenge on our Facebook Page, Twitter, and our Weekly Newsletter (over 130,000 people)!
It’s time to show that elephant who’s boss. Remember, you have 7 days, and it starts… right… now!
#1 – Ad frequency
We’ve all had those moments when a superbly performing ad campaign suddenly stops delivering. So we’re left wondering what might have happened to this superstar.
One of the most common problems in that your ad campaign has reached a high ad frequency, meaning that Facebook has shown the same ad more than 3 times to the same person.
Regularly checking your ads’ frequency is a must if you want to avoid ad fatigue and stop annoying your audience with the same ads all over the place (that is, their Facebook News Feed).
High ad frequency might double you cost-per-click really fast.
Need some more convincing? AdEspresso analyzed how ad frequency affects the click-through rate, cost-per-click, and cost-per-conversion of ad campaigns. Here are their findings:
When people saw the same ads twice, the click-through-rate decreased by 8.91%. But when shown repetitive ads for 5 times, the cost-per-click was already 98.51% higher.
How to track your ads’ frequency:
Go to your Facebook Ads Manager, click on a campaign, and in the reporting section select the Delivery view.
If you notice something like this…
… It’s best to pause your ad campaign and start thinking about new ad visuals and messages for your ads – or simply change your ad campaign’s audience.
# 2 – Relevance score
Does your audience love your ads? What if they hate them instead?
The Relevance Score is a calculated metric that helps to understand how your audience is reacting to a particular ad. It’s a great beginner-level metric to learn about your audience’s preferences and adjust your ad campaigns accordingly.
A higher relevance score raises Facebook’s willingness to display the ad in users’ News Feed and lowers the cost-per-click. Here’s a fascinating graph by AdEspresso:
Read the entire case study here: Relevance Score: We analyzed 104,256 Ads to understand and improve it
How to monitor your ads’ relevance score?
The easiest way to find out is to go to Facebook Ads Manager and pick a campaign. In the campaign view, click on the Columns menu and select “Customize Columns…”
Next, find the Relevance Score metric in the menu and add it to the columns.
Now, you should see each ad’s relevance score in the reporting table. It can go from 1 to 10, depending on the positive and negative feedback your ads receive.
If your relevance score is lower than 5, here’s what you can do:
1. Target a more accurate audience
2. Make your ad messages more clear
3. Ensure your call-to-action button isn’t confusing people
# 3 – Click-through-rate vs. Conversion rate (The real ROI of your ads)
Your ads might be having an awesome click-through-rate, but if they don’t convert, you won’t get any new customers.
When analyzing over 100 Facebook ads in one month, I learned that a lower CPC didn’t necessarily equal a low cost per conversion.
Take a look at these two graphs I found when analyzing the performance of “Sign Up” vs. “Learn More” call-to-actions with AdEspresso.
RED signifies the “Sign Up” call-to-action while BLUE signifies the “Learn More” Call to action.
Graph 1: “Learn More” CTA outperformed the “Sign Up” CTA, resulting in a much higher click-through-rate.
Graph 2: Only “Sign Up” CTA delivered conversions, e.g. people signing up. Which means that the “Sign Up” call-to-action was the only one that delivered a positive ROI.
Sometimes, it is wiser to let go of the clickbait and use a clear message that explains what you expect people to actually do.
A low conversion rate might also indicate that there’s a low hanging fruit waiting to be picked. What if you improved your landing pages AND ads simultaneously?
# 4 – New Leads vs. New Paying Customers
The problem with Facebook lead ads reporting is that you only know how many new LEADS you get. But what about the paying customers?
It is super important that you also check the lead-to-client conversion rate of your Facebook ad campaigns.
What if only 2.5% of your Facebook ad leads continue to use your product/service after the trial period’s over? This means that the cost per paying customer is 200 times higher than the price you pay for a new lead. So if you acquire a Facebook lead for $12, the real price for a new client is $12 / 2.5% x 100 = $480.
Tip: Compare your cost-per-customer to your average customer lifetime value to evaluate whether your Facebook ads deliver a positive ROI.
# 5 – Facebook Ads customer churn
Do you measure the customer churn rate in your company? Did you know that you can also measure the churn rate for your Facebook ad campaigns?
Why should you measure the churn rate for ads?
A high early-stage churn rate might indicate that the clients have set high expectations that your product/service fails to meet.
But where did they get these skyrocketing expectations? Your Facebook ads might be to blame.
Add the churn rate to your Facebook ad metrics monitoring list to know which ads deliver a wrong message that confuses your clients. And make sure you deliver what you promise!
It’s OK to over deliver the promises in your Facebook ads, but it’s not OK to under deliver.
How to keep your ads down-to-earth while still attracting attention:
- Use highly engaging visuals and high-quality ad design
- Use a clear call-to-action that delivers what it promised
- Keep your ad messages highly relevant and accurate
- Whatever you say, never lie
# 6 – Ad performance by placement
How do you choose where to display your ads?
Showing your ads across multiple channels helps to reach a wider audience. But it can easily backfire if you don’t pay attention to the performance of each ad placement.
When recently analyzing our ad placements, I came across a huge difference between our ad placements’ performance. The Mobile + Audience Network placement was outperforming Desktop Feed by 36%. That’s a huge difference.
Before you scroll ahead, take another look at the screenshot above. Look at the Conversions row. Desktop ad placement returned 13 conversions while Mobile failed to deliver.
Remember: Collecting clicks is not your end goal. You likely want people to sign up to your product/service or start a free trial. Track which ad placements have the lowest cost-per-conversion, the least expensive cost-per-download, etc.
How to track your ad placements’ performance:
Option 1: AdEspresso
The easiest (and fastest) way to compare ad placements is to create an ad campaign with AdEspresso. Before publishing the campaign to Facebook, select the option to test various ad placements. You can see the results in your campaign reporting.
Option 2: Facebook Ads Manager
Go to Facebook Ads Manager and open a campaign. In the Breakdown menu, select Placement. Now, you’ll see how each ad performed while being displayed in various channels.
As you discover a poorly-performing ad placement, turn it off and allocate the budget to another placement. You’ll soon see your cost-per-conversion going down.
# 7 – Clicks by interests
Want to target an even more accurate audience who’s highly interested in your offer?
You can improve your ad targeting by looking at the interests of your current ad audiences. In AdEspresso, you’ll see the most popular interests under each ad campaign.
You’ll be able to monitor which targeted interests returned the most clicks, and eliminate poorly-performing interests from your target audience.
Moreover, you can use the most frequent interests to craft new target audiences. Here are a few ideas of what you could test as interests:
- Purchase behaviours
- Job title and employer
- Life events & advanced demographics
Clicks by interest is a metric that many marketers tend to forget about. Do not make this mistake. You may even create a spreadsheet to keep track of your top audience interests to use for future targeting.
# 8 – Ad engagement rate
We’re so busy optimizing our Facebook ads to deliver a higher ROI that we forget about the human level of advertising – engaging with real people.
Facebook ad engagement metric shows the number of individuals who liked, commented, or shared your ad. Moreover, it includes people who watched a video, visited your page, liked a comment, clicked on a commenter’s name, etc.
How to measure the engagement rate of your ads:
Go to Facebook Ads Manager and click on a campaign. Next, customize the columns to show the ads’ reach and post engagement.
Now you see the total engagement and people taking actions. But you still need to calculate the Engagement Rate metric. Use this simple formula:
Engagement Rate = Impressions / Post Engagement x 100%
Compare your ad campaigns’ engagement rate to understand which messages, visuals, audiences, and placements perform the best.
A low engagement rate may indicate that:
- People aren’t interested in your ads
- Your ads fail to attract comments
- Nobody cares about your brand or offer
- You’re targeting the wrong audience
- You’re using the wrong ad placement
Alright, folks. We’ve been through another session of learning how to improve your Facebook ads!
Remember there’s a challenge going on!
Track all these eight Facebook ad metrics and let us know (posting on the AdEspresso Facebook page, Tweeting us the image @AdEspresso or using the Twitter hashtag #AdEspressoContest) whether you were able to address the elephant in the room – that poor performing metric you know you need to change!
We’re already waiting for your comments and… to crown the winner!