It seems like everyone is talking about optimization in 2022. But, most “optimization,” tips online are really just how to set up winning campaigns for beginners.
The real optimization happens once your Facebook ads are reliably getting positive ROI. This is when you have to start creating a reliable system for your ad decisions, which allows you to improve Facebook ad performance.
The first thing to focus on when optimizing, is to avoid three of the biggest mistakes that advertisers make that tank their ROI when trying to optimize.
Biggest Mistakes When Running Facebook Ads
- Using bad data to make decisions about campaign budgets.
- Turning off ads before they can be profitable.
- Focusing on only one level of your funnel.
- Not optimizing for high LTV customers at TOF.
- Ignoring important metric benchmarks.
Garbage Marketing Attribution Data = Garbage Decisions
Is your Ad Manager reporting revenue and sales that match your CRM?
Chances are that it isn’t, because Facebook doesn’t have the technology or ability to track ads as accurately as Wicked Reports. Because Facebook uses 3rd party cookies which track users across a plethora of sites, there are huge privacy concerns here. Privacy compliance is one reason why Facebook is unable to track individual customers and use that information to help advertisers get better results.
There’s an alternative here - using a privacy compliant, 1st party data, multi-touch marketing attribution software like Wicked Reports.
We can track repeat customer orders and even differentiate between individual purchases and subscription revenue. This allows your brand to track average customer LTV, and use that information to create audiences that match your best customers. This is a great way to improve your Facebook ad performance.
Not only that, but using our multi-touch marketing attribution models, you can discover what content specifically attracted those higher value customers and recreate their journey.
Better data helps you get more repeat, high value customers… and increases ROI. That’s what Wicked Reports is all about.
Give It Time
This is probably the most common mistake we see with new Wicked ecommerce brand clients.
They run a new ad or to a new audience for three days (or less!), and then turn it off because the ROI isn’t positive.
The problem with this is that most clicks don’t convert to customers in three days or less. They take longer than that!
Most brands starting on our Dashboard don’t even know how long clicks take to buy. Without knowing Buying Cycle Time, it’s impossible to make decisions like how long to run an ad before deciding its fate.
That’s why we created our Predictive Behaviors Report, which offers brands detailed insight into how long it takes clicks or leads to buy after first interacting with an ad.
Optimize At Every Level of Your Marketing Funnel
It’s important to pick the right “optimization” for the ads at each step of your funnel.
Don’t make the mistake of confusing the Facebook ad “optimization,” for more complex and essential optimization of your ad performance.
For example, some less experienced media buyers might think that optimizing cold traffic for clicks or leads is ideal. This is a costly mistake.
The best brands are optimizing their cold traffic for purchases, or even better for high value customers (LTV). By feeding LTV data back to Facebook through custom audiences, you can create lookalike audiences to target with cold ads and drastically improve your cold traffic performance.
Benchmarking For The Win
How can you know if your Facebook advertising is actually improving if you aren’t benchmarking?
There’s two ways to benchmark marketing; you can compare against others, or against your brand’s past performance.
What are the most important metrics?
Everybody that uses digital advertising uses metrics like Cost Per Click (CPC) and Cost Per Lead (CPL), and Cost Per Customer Acquisition (CAC).
But some of our most successful 7- and 8-figure ecommerce brand clients use metrics you might not have heard of.
Average Order Value (AOV) can be critical for brands looking to increase their ROI. Small changes to your marketing funnel, offers, or storefront can drastically increase AOV, and bring in more revenue for every sale without increasing advertising costs.
Buying Cycle Time is a critical metric that is impossible to measure without Wicked Reports. This information can be used to help you get your advertising money back faster (by measuring and discovering what reduces your buying cycle time). It’s also critical for knowing how long to run a new campaign before evaluating it’s ROI and deciding it’s fate as a winner or a loser.
Customer Lifetime Value (LTV) is another metric that most brands don’t look at. That is because this metric is impossible to know if you are dependent on Facebook’s Ad Manager to measure marketing performance. The best way to discover this for your brand is by using a third party marketing attribution software like Wicked Reports.
Our clients can not only track all the orders associated with a specific customer, but we can show you how they discovered your brand, every email they opened, and which content inspired each purchase, down to every last click.
This is what a high LTV customer's journey looks like inside our Wicked Reports dashboard:
Imagine the power of using this level of detail to recreate the customer journey for your highest value customers, over and over again, instead of focusing on just bringing in new (expensive) customers. Your ROI over time will be exponentially better with repeat or subscription customers than with the constant advertising cost of convincing new customers.
Benchmarking against your brand’s past performance is the best way to see if you are incrementally improving your Facebook ad performance. And it’s very motivating to see how far your ads have come!
Improving Facebook Ad Performance Through Optimization
To summarize, there’s a few critical steps to optimizing Facebook ads for high ROI marketing performance:
- Use accurate multi-touch marketing attribution.
- Be patient, give campaigns a chance to perform before you kill them.
- Optimize at every step of your funnel, not just for the last click.
- Benchmark your marketing metrics against past performance.
The best optimization happens through iterative improvements with accurate attribution.
Want to know more about how to use the Wicked Reports dashboard to optimize your Facebook ads?