Facebook advertising is an incredibly powerful social media tactic. Why else would 72% of marketers use the platform to run social media ads?
But how do you know it’s working? And how can you ensure you continually get the best results from your budget?
As with all digital marketing tactics, you need to measure the right metrics.
Before we look at the metrics you need to guide your Facebook advertising campaigns, there are two metrics you shouldn’t focus on:
These are known as vanity metrics.
For years, marketers and business owners have been focusing on getting more “likes”. But even if you have thousands of people like your ad campaign, that doesn’t mean they will take action and become a customer.
That’s not to say “likes” mean nothing. They can add social proof, which builds trust and credibility.
The same goes for “reach”.
Even if your campaign reaches tens of thousands of people, it doesn’t matter unless they convert.
So, what are the Facebook ad metrics you should use?
Take a look:
1. Return On Ad Spend (ROAS)
Think of ROAS in the same way as return on investment (ROI). It is a measure of your success with Facebook advertising, telling you whether your digital advertising dollars are getting results.
How to calculate ROAS:
ROAS = Total revenue generated from Facebook ads (i.e. return) / Total ad spend
2. Cost Per Sale
This tells you how much you are paying to make a single sale using Facebook ads.
How to calculate Cost Per Sale:
Cost Per Sale = Total number of sales generated by Facebook ads / Amount spent on Facebook ads
3. Cost per lead
Depending on your business, your goal for Facebook advertising might not be to generate sales. For services or high-value purchases, you are probably focusing on driving leads and getting potential customers into your nurture campaigns. According to Databox, 49% of Facebook advertisers say generating leads is their most common goal for Facebook ad campaigns.
This is why it’s important to measure the number of leads and the cost per lead.
How to calculate Cost Per Lead:
Cost Per Lead = Total number of leads generated by Facebook ads / Amount spent on Facebook ads
4. Number of Ad clicks
How many times are people clicking on your Facebook ads? More clicks means people want to find out more and are interested in what you have to offer.
Here’s the confusing part: an ad click isn’t just when someone clicks through to your website.
It is any action someone takes when they see your ad. For example, it could mean they expand the ad to read more, scroll through the carousel to see other products, and so on.
Ad clicks can tell you a lot about your campaigns. Let’s say you have a high number of clicks, but your conversion rate is low. You need to work on optimising your web page to drive conversions.
5. Conversion rate
Conversion rate is another top metric for Facebook advertising. It tells you the percentage of people who click on your Facebook ad and convert – whatever that means for your business. That could be downloading an ebook, purchasing a product, signing up to your newsletter, making an enquiry, and so on.
The bottom line is this: If you want to get the maximum return on your Facebook ad investment, you must measure the right metrics.
But it’s not enough to collect the data; you should be using the insights to test, fine-tune and improve each ad campaign. Test different headlines. Refine your target audience. Try out new calls to action. See every ad as an opportunity to improve.
Looking for more practical ways to use Facebook advertising as part of a high-return social media marketing strategy? Enrol in our Diploma of Social Media Marketing.