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5 Facebook Advertising Metrics That Matter

When it comes to Facebook advertising, data is key. But looking at too much data might turn your optimization into a nightmare. What’s even worse is not knowing which metrics you should really pay attention to, and which ones don’t matter as much. In this article, we will go over 5 important Facebook advertising metrics you have to understand in order to build successful campaigns that drive your business forward.

How To View Facebook Ad Results

  1. Log in to Facebook and go to Ads Manager.
  2. Click Campaigns, Ad Sets, or Ads.
  3. Scroll to the right and you’ll see metrics in columns like: Reach, Impressions, Cost per result, etc.
  4. Customize your columns and metrics by clicking the Columns: Performance drop-down menu and select Customize Columns (optional).

5 Facebook Advertising Metrics That Matter

  1. Conversion Rate

Your conversion rate is the percentage of people who take specific actions like make a purchase, install an app, input their email, and many others. To say the least, this is the most important metrics out of all the other ones because your ultimate goal of creating ads is to convert as many people as possible based on what your campaign objective is. If you are able to boost your conversion rate, it means you can make more sales.

This metric can help identify flaws in your marketing strategy. Let’s say your campaign objective is lead generation, which means you want people to sign up for your offer. For those in ecommerce, lead generation is useful for collecting emails and growing your lists. Suppose you have a decent number of people clicking onto your ad at a low cost, but those people are not converting into leads. This is a warning sign that you may need to analyze your landing page. The reason why people are not converting could be because there is an error on the landing page, they don’t like the offer they see, or the process of opt-in is poor.

  1. CPA

CPA stands for cost per action. Since many of you are probably in ecommerce, your CPA is likely to be the cost of getting a sale for your online store. CPA gives you an accurate performance of your ads. If you can lower your CPA, you’ll be able to have higher conversion rates and drive more revenue without spending so much on ads. The most important thing you need to understand about CPA is how much it cost for you to get a sale. Are you breaking even, profiting, or losing money? To find out what your breakeven point is, you need to first figure out your profit. From then, you simply minus the cost of good from your revenue. If your CPA is higher than that number, it means you’re losing money. If it is lower, it means you’re in profit.

  1. CPC & CTR

CPC stands for cost per click, and it is the average cost of a click from your ad to your landing page. CTR stands for click through rate, and it is the percentage of times people saw your ad and clicked on it. These two metrics work hand-in-hand and affect each other. If you see a high CPC, you’ll have a low CTR, vice versa.

If someone sees your ad and clicks on it, this already means the person is interested in your offer and wants to learn more. A low CTR may indicate that your ad creative doesn’t appeal to your target audience, or your ad targeting is inaccurate. CPC and CTR are not the most important metrics, but they are a good general indicator to measure the appeal of your ad campaigns. As a general rule of thumb, you should try to aim for a CPC of less than $1 and CTR of 1% or more.

  1. CPM

CPM stands for cost of impression, and it measures the amount it cost you to get a certain number of impressions. Impressions is the number of times your ad appear on someone’s screen. If you have a high CPM, it means the market for your niche is competitive because you are spending a lot more for your ad to reach your target audience. You want to aim for a low CPM as much as possible. CPM is helpful to gauge the cost-effectiveness of your ad campaign, and to compare your ad performance against your competitors.

  1. Frequency

Frequency is the number of times your ad has been served to a person. As marketers, you obviously want your target audience to see your ads, but there’s a happy medium on how often they should see your ads. If you keep showing the same ads to the same person, they’ll get bored really fast. This is called ad fatigue, and it could really hurt your ad performance. As frequency increases, the click-through-rate (CTR) decreases and cost-per-click (CPC) increases. Annoyed audience may even leave angry comments on the ad post or even submit feedback to Facebook that suggests they are seeing your ad too often.

To fight high frequency and avoid ad fatigue, you should rotate different ad creatives or find new audience to target.

Conclusion

Facebook advertising is your go-to social media platform to market your products for ecommerce. When you run your first few ads on Facebook, it might get confusing and overwhelming with the amount of data you get. In this article, we’ve shown the 5 most important metrics that you should focus on to improve the performance of your ads. Note that you should not isolate each metrics at a time, but view them altogether to gain insights on your ads.