Do you need to have a better grip on the performance of your Facebook ads? Do you know which metrics in the Facebook Ad Manager monitor?
In this article, you'll learn how to set up a Facebook Ad Manager report that quickly reveals which ads work correctly and which ones need to be modified.
Because the ongoing analysis of your Facebook campaigns is important
A common mistake advertisers make is to launch a Facebook campaign and not run analysis while it's running. It is the analysis of your campaigns and the subsequent actions you take based on your results that offer an exceptional return on advertising spend (ROAS).
By analyzing the performance of your campaign consistently, you will be able to do it quickly timely fluctuations in campaign metrics that signal the need for update testing or reveal winning ads on Facebook that you should resize.
No. 1: Understanding what 4 basic metrics mean for the analysis of Facebook ads
The analysis of four key parameters – cost, relevance, frequency and CPM – helps you identify and evaluate the performance of your campaigns and the ads within them.
Let's have a look at each main metric in turn.
Cost per result
The first metric to consider is the cost per result. The cost metric is not the total spend or the amount spent for each of your campaigns; it's your cost per result based on the goal of your campaign and the optimization of your ad set. If you've set a daily budget and are not resizing your campaigns and the cost per result decreases, your campaign results will increase.
Let's say you're running a conversion campaign that optimizes Add to Cart actions and drives your website traffic. If you see decreasing the cost per Add to cart and increase the number of shares Add to cart, you are increasing the number of clicks and sales from your website. The opposite is true if the cost per result is increasing. Your campaign is decreasing in performance and you will get less results for your budget.
Score of relevance
The next metric to examine is the relevance. A relevance score is a rating of 1 to 10 that Facebook provides to each of your ads. This score reflects the eligibility of the public and the way people respond to your ad. This metric can only appear at the ad level of your campaigns.
After 500 impressions, your Facebook ads will have an initial relevance score. However, this score will usually change, increasing or decreasing in the first 72 hours as the campaign is incorporated into the algorithm.
If your relevance score increases over time, the cost per result generally decreases and your campaign's performance increases. On the downside, when the relevance score decreases, the cost per result increases, indicating that the campaign's performance is decreasing.
The third metric to be examined is the frequency. Attendance is a delivery metric that tells you how many times someone has seen your ad on average. Frequency will always start at 1 and increase over time as you spend more on your campaign budget and reach more audiences.
As the frequency increases to 2, 3, 4, 5 and so on, you will notice that it has an impact on the cost per result and on the score pertaining to it. The higher the frequency, the more people see the same Facebook ads. In the end, you will hit the so-called fatigue of the ads. Your relevance score will start to decline and the cost per result will start to increase. Overall, your campaign's performance will decrease and this will have a negative effect on your ROAS.
Finally, look at CPM, which stands for cost per thousand. This is your cost per 1,000 impressions. As your frequency increases and you reach more viewers, your CPM will start to increase. This means that it now costs you more than 1,000 impressions than before. This will have an effect on the cost, relevance and frequency parameters.
For campaigns that are decreasing in performance due to the ad fatigue indicated by a high frequency, you will also notice the CPM and the cost per result will increase. Therefore, relevance scores will decrease. When you have a campaign that is improving, however, your frequency will increase again, but at a slower pace because you are reaching more than your target audience because of high scores.
Your CPM will stabilize or shrink slightly and, as a result, the cost per result will also decrease, thereby increasing the percentage of results and ROAS.
2: Create a custom report in the Facebook Ads Management
To measure the four main metrics in a reporting view, you want to create a custom reporting column in the Ads Manager dashboard.
First, log in to the Ad Manager dashboard is select Customize columns in the Columns drop-down menu.
In the Customize Columns window, remove irrelevant columns and, in the Performance section, select the check boxes to add relevance score and frequency. So under the Cost category, add CPM.
In the lower left corner, select the Save as preset checkbox is assigns the new column "CRFC metrics". Then click Apply to save the changes.
You now have a specific report view to use at the ad level of your campaigns.
3: compare and analyze metrics reports
Use the Compare feature to track changes in these four key parameters to measure the effectiveness of your Facebook ads. By using this function in data reporting, it is possible Keep track of how these metrics change over time while your campaigns are running.
This allows you to understand how your ads are shown and when to make changes, known as "update tests," to reduce the impact of ad fatigue.
One of the comparison report methods that you can use is a 7-day running analysis. This is where CRFC metrics are compared from the last 7 days to the previous 7 days.
To use this tactic, go to the ad level of a campaign that has been published for at least 2 weeks. Once you're at the ad level, select the CRFC metrics reporting column you have created before.
Later, in view of the reports, select Last 7 days.
Finally, Switch the compare switch in the report view and the previous 7-day period will be selected automatically. Click Update.
Now see the arrows next to the titles of your columns, as shown below. Click the arrow of a column to view the change (from first to second) in actual numbers for the given metric, as well as the percentage of increase or decrease of the metric one.
Review this data for cost columns by result, relevance, frequency, and CPM.
In the following example, you can see that the cost per result, the Add to Cart action, increased by 26.67% from £ 1.50 to € 1.90. Specifically, the first ad in the top row increased by £ 0.77, the ad in the second row decreased by £ 0.35 and the third ad rose by £ 2.01.
By doing this 7-day rolling analysis level (comparing last week's data with the previous week), you will be able to identify when campaigns start to decline in terms of effectiveness due to ad fatigue. Then you can implement the update test to combat ad fatigue.
You will also be able to identify the opposite effect, when your campaigns increase in performance and you want find a winning ad in scale.
What do you think about it? Have you tried running a 7-day running analysis on your Facebook ads? What changes have you made based on your findings? Please share your thoughts in the comments below.