Minimalist Guide to Facebook Ad Metrics 11 Measure and Improve your Facebook Ads ROI

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231

231 is the number of Facebook ad metrics to measure our Facebook ads!

Finding the 1 or 2 critical metrics in the 231 is like trying to find a needle in a haystack. You know it is there, just not sure where look to find it.

Let us filter the 231 fluffy metric to a sensible number.

Here are my lucky 11 Facebook Ad Metrics to track…and the 212 to ignore.

Yet, numbers without context are just so many needles in the haystack. A short case study, for service providers, illuminates the context for Facebook ad metrics.

UPDATED NOTE: January 2021. This Facebook Ad Metrics post was updated for content, readability, speling, gramer, syntext, context and the continuous updating and understanding of Digital Marketing.

The case study funnel starts with a cold brand unaware audience and finishing with cash in hand buyers. Sound good? We will ignore upsell, down-sell and cross-sell for the moment.

The sticky honey of this funnel is the helpful articles, videos and audio files.

But wait! Why advertise on Facebook in the first place? Is social media not free?

Don’t worry, this is Urban Renström, there is always science and research involved in everything I talk about, teach, and demonstrate.

Why Run Facebook Ads in the First Instance?

Yea, social media is free, but, putting your post/read magnet/offer in front of the right people at the right time is not free.

Why then run FB Ads? And most importantly which Facebook Ad metrics should you monitor to track success?

  • Organic post reach is dead nor buried (for most page owners) with 2–16% of fans seeing a post,
  • Facebook Ads let you cut the queue and get in front people who matter most to your business,
  • Ads are the cheapest and fastest way to grow a business, and
  • To attract and capture leads before the competition
  • Facebook ads platform is the most powerful in the world

My clients see the business opportunities and are why they let me run their ads and why you should also run ads (or let me run ads for you).

‘A’ Funnel for Coaches, Consultants and Service Providers

A marketing funnel is a journey people take from complete problem unaware to buying from you learning at each stage. Yes, I did gloss over about 9 steps for simplicity.

Inbound Marketing Funnel showing TOFU, MOFU
The Inbound Marketing Funnel

In a perfect world prospects only interact with your brand, gain knowledge and learn from you. In this perfect world, you become the ‘trusted adviser’ and authority.

You can slice and dice marketing funnels in more ways than there are straws in a haystack! The point to remember is at every step, people become informed and ask more questions before they buy.

(Anticipating and answering these questions is at the core of content marketing).

Traditional Funnels have 5 stages: a) Problem unaware, b) problem aware, c) solution aware, d) product aware, e) most aware states.

At each step of the 4 or 5 steps, people have questions.

I am trying to aim at people at the top of my funnel for Facebook Ads – the problem unaware/aware stage.

Remember – keeping clients is 5X more cost-effective than acquiring new customers. So do you have a robust clients retention strategy?

How Does One Educate the Unawares and Convert the Awares?

With content and compelling offers.

Yep, simple as…. (well, not simply because taking an action is the hard part).

Follow for a sticky honey second and see why Facebook loves content and frowns upon direct response ‘buy now offers’.

(Pulling the idea string along) what if our newsfeeds were full of super ‘special’ special offers. Would there be a difference between the late-night TV infomercials and Facebook? No, probably not and people would ignore, get tired and abandon Facebook. That would be a bad day for Mark Zuckerburg’s wallet (not being cynical, only stating business truths).

The challenge is allowing ads and not alienating people.

So, how does Facebook circle that square?

Further, we know businesses are making ‘cake’ with Facebook Ads. So what gives?

Does Facebook favour advertisers with massive budgets and ignore the small guys/gals?

No and NO! Smart Facebook marketers make revenue and profit in a few steps.

Be Indirect like the Inbound Marketing Crowd.

…see add – buy product’ does not happen, ever!

People have to know you, like you and trust you before they buy from you. This moniker holds true if you sell €9.99 widgets or a high-ticket €9,995 coaching program.

A quick and dirty simple funnel for indirect selling on Facebook:

  • offer a read magnet (blog post),
  • visitors arrive on your website and gets Pixeled,
  • retarget these visitors with a lead magnet, or different blog post,
  • if a person opted in to the lead magnet then warm up with autoresponder email sequence, if not then
  • retarget again with a different lead magnet or offer your core product.

Red (or read) magnets are the sticky honey blog posts that give, give, and gives oodles of useful and valuable information.

Why a blog post/article?

Facebook favours and encourages advertisers who send people to a blog post. Not straight to a sales or product page (yes, an exception to every rule exists).

This is what happens when you ‘Red Magnet’ People (or read magnet)

Many many people in your target audience see your ad. Some people will click the link, visit your website, and read the article.

When people land on your website, they get pixeled. Then retarget visitors with different offers, or e.g. a lead magnet. (Yes, I again oversimplified and glossed over about 20 key steps).

If no one takes your lead magnet then offer a different blog post. Maybe ‘a solution aware’ or ‘product aware’ blog post.

(You have installed the Facebook Pixel right? Right! Good, very good.

Is Sales the Most Important Business Metric?

Cash is Oxygen for a Business.

Yep, revenue and profits are the most important metrics. And you did not need a rocket scientist to tell you that either. Moreover, you understand the simple ‘see add – buy product’ does not happen, either.

This smart Facebook strategy warms up a cold unaware audience before you offer the product. This magically lowers your total acquisition costs, ups revenue, profits, and increases customer loyalty.

facebook-ads-metric
11 Facebook Ad Metrics to monitor

11 Facebook Ad Metrics Used At Every Stage of The Funnel

1) Reach – Absolute number of people that saw your Facebook advert, e.g. 3658

2) Impressions – defined as ‘an ad seen by people. The unit of measure is CPM (cost per mille). CPM is measured in money per thousand views. E.g. CPM of €5.23 means the advertiser paid €5.23 to get 1000 views of an ad.

Note: each person can and often does see an ad more than once – this is expressed as the frequency of the ad – frequency is #7. Think of impressions as Facebook’s RPP.

3) CPL – cost per lead. The amount of money spent to acquire a lead.

4) CPC – cost per click – a cost paid to get a person to click a link.

5) Amount Spent – the total monies spend – either on a campaign or lifetime.

Minimalist Facebook Ad Metrics: Ads to a COLD Audience – The Read Magnet

(This is step 1 in the funnel).

Use the Clicks-to-Website, Website Conversion, or Video View and put a blog post in front a cold audience.

Click to Website or Website Conversion

Definition – both clicks to website and Website Conversions send people to a website. A ‘Clicks to Website’ campaign tells Facebook to find people in your target audience who are more likely to click ads taking them to a website.

Choose a ‘Website Conversions’ tell Facebook to find people in your target audience who will convert. Complete a form – signup, shopping carts etc.

Note: advertising to a cold audience will cost the most amount of money of any group in your funnel.

Why suggest website conversions when you want people to click on the website? Great question. To test and see which is better. Some audience responds better to one objective than the other. The only way to answer the question is with testing.

The Read Magnet Metrics – Ads Relevancy, CPC, CPM, and Ad Frequency.

6) Relevancy score is akin to the check engine light on your dashboard – on it signals something is not ok, just does not tell you exactly where the problem exists.

The relevancy score is a 0-10 number on how relevant an ad is to an audience. Stop all ads less than 8. Ads with a low relevancy scores will have lower delivery, CPM, and higher costs. Higher numbers >7-8 will not. However, like your check engine light alighting, does not mean stop driving, same with your campaigns, if the numbers are low, check CPM, impressions, CTR and sales.

CPM – (see no 2 above)

CPC – (see no 4 above). Cost per click – total campaign cost divided by a number of clicks. E.g. €15.23/66=€0.23 per link click.

7) Frequency is impressions divided by reach – displayed as an average. Frequency relates to how often a person sees your ad. Some people see the ads more than once. I limit my news-feed ad frequency to 4 to fans and 2 to non-fans (numbers are limits from Facebook). The RHS, right-hand side ads frequency is uncapped.

The relevancy score is correlated with frequency. Higher frequency equals lower relevancy.

Video View Campaign (Objectives)

Facebook get video views.

The video is hot. So hot Facebook lets everyone broadcast live with video! Image that! Even better, (well no not better) videos get more engagement than static image ads.

What metrics to watch?

Relevancy score – (see no 6 above).

8) Video views, video views to 10 sec, 30 seconds, and you can track views to 25%, 50%, 75%, and 100% of the video. If people abandon after 10 seconds then your video is not resonating. Consider stopping and revising your video.

What Do I do with this Data?

Think about what happens. Put aside for a second the ‘I spent money and go zero sales’ point, ok? Stay with me and follow the idea flow. If your audience was 100,000 people, and you have a budget of €100, your CPM is €10. Therefore, from the 100K audience, 500 people clicked on your ad.

€100 got 500 people to click your ad.

The CPC is €0.20. €0.20 gets a person reading the blog post and pixeled. I’ll take €0.20 – all day and all night long.

Celebrate!! 500 people, 500 (!) landed on your blog post. 500 people raised their hand (or finger on the mouse) and said ‘I’m interested enough to click on your ad taking me to your website. These 500 people are now warm and interested prospects.

What is a good CPC number, then? For cold traffic, I do not pay more than €0.40 CPC and often my numbers are in the €0.2-0.3 range, but your mileage may vary, as the car adverts state!!

Minimalist Facebook Ad Metrics: Advertising to a WARM Audience- Lead Generation Campaigns

(Step 2 in the funnel)

Retarget and offer a lead magnet. Offer to join your private Facebook group; or offer a core product or a coaching call.

Suggest using the website conversion objective, a lead ad, or video combined with a website conversion ad.

Further, the 500 are ‘solution aware, or product aware’. Match the advert messaging with the awareness and expectation level of these 500.

Lead Generation Campaign, CPL, and Time Horizons

Cost per lead is the top-line metric for lead generation campaigns.

CPL – see no 3 above. Cost per lead is the money spent to acquire leads. How much you spent to get an email address, phone number, or sale. Calculated using the amount spent (per campaign) divided by the number of leads generated.

Amount spent — (see no 5 above).

9) CTR — click-through rate. Calculated by dividing link clicks by impressions (Facebook uses impression, not reach).

10) Link Clicks — number of people who clicked on the link in your ad. Be warned as not all link clicks a result in people arriving on your sales page/landing page.

The numbers Facebook reports is often different from Google Analytics reports. (Yes, an important discussion for a different blog post!)

Impression — (see no 2 above)

Frequency — (see no 7 above)

What Do I do with this Data?

Check to see if you are on target to get leads at the right price.

Minimalist Facebook Ad Metrics – Advertising to a Hot Audience

Topline metrics

11) Conversions – the number of people who converted into a lead or sale from your ad. Accurate numbers need conversion tracking installed on the “thank you” page. The “thank you” page is the page people see after completing their purchase.

Cost per lead – (see no 4 above) how much each sale cost. Also, this number gets displayed in the reporting. See below image

Yet, this is for the single Website Conversion retargeting campaign, and is not ‘fully burdened’. As does not include the costs of getting the initial people to your website from step 1

Take the ‘Amount Spent’ from your clicks to website ads e.g. the €15.23 (CPC) divide by 66 (number of clicks) and add this to the Cost per Checkout.

The Second Tier List of Facebook Ad Metrics to Monitor

Relevancy score — (see no 6 above).

Click-through Rate (CTR) — (see no 9 above).

Impression — (see no 2 above).

Frequency — (see no 7 above). Frequency is important, as the pool of people is smaller as we target deeper into the funnel.

What Do I do with this Facebook Ad Metrics data? How to Convert Data into Action

View the number of checkouts and the cost per each. When these ads are set up and monitored, you will not get a shock. As in the ‘Amount Spent’ from steps 1 – 3, is less than the profit margin on your product.

What to do when it goes sideways?

Then do this:

If the ad relevancy score is < 8, then stop the ad and a) change the image, b) change the text.

Frequency – if above 3.5, 4 then your offer is not resonating with your retargeting audience.

Ask these two questions: 1) is your lead magnet the natural extension of your blog post? If not then reassess and change. 2) Offer a different blog post.

Remember your audience may not be ready to splash the cash or hand over their email address – no matter how compelling is your, checklist, cheatsheet, eBook, course or offer.

The top 11 list of Facebook Ad Metrics track…and the 212 to ignore.

And the 212 to ignore is for another blog post.

Which metrics do you track? Let me know in the comments section.

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