It’s the BIG question that almost everyone asks about running Facebook and/or Instagram ads… “how do I know if my campaigns are actually working?”
From being in this industry for so many years, I’ve come to understand that what people are often looking for when asking this question is an understanding of which metrics out of the fuck ton that Facebook gives you, are the ones they should actually be looking at and caring about… as well as if their CPC or conversion rate or whatever is considered “good.”
So, let me address both:
- You’re asking the wrong questions. The absolute only possible thing that could EVER really matter in determining if your campaigns are successful or not is profitability.
- It should be very simple – if you’re making money from your campaign, then it’s a success! If you’ve got the best cost per click in the world but aren’t profitable, it’s most certainly not.
This seems obvious but I can’t tell you how often I ask prospects how their campaigns are performing, and people cannot answer how it’s contributing to their bottom line.
They can rattle off their cost per click, their conversion rate, or what they think is an impressive cost per lead… but they have no clue how it’s contributing to the actual growth of their business. Ain’t that the only thing we’re here for?
When my team and I work with our VIP-level clients, we know that just looking at the CPC or CPL or even the ROAS without understanding the client’s profit margins, is rather shortsighted. We’re in the game of helping businesses generate more revenue, and that involves not only effective ads and technical know-how… but also this big picture context of focusing on what actually puts more money in the bank.
In fact, getting bogged down by allllll of the metrics available, can actually have you incorrectly optimize your campaigns, guiding you to scale certain ads and audiences that look good “on paper” (i.e. in the Ads Manager) but don’t actually drive revenue at the highest return possible.
What’s more, if you’re focusing on what you think a particular metric “should be” based on industry standards or whatever, you’re missing the bigger picture. (Also, comparison in business is a joy killer) We’ll often have two different clients with similar costs per lead but drastic differences in ROAS… or an account with fairly low relevance scores (the newest not-super-important thing that people love to obsess over) that is still making BANK.
(It should go without saying that a big part of what I’m talking about here requires effective tracking and attribution. Your ads won’t always generate a profit immediately, but that doesn’t necessarily mean those ads don’t work OR that you should forget about profitability all together.)
There is no guaranteed direct correlation between the plethora of metrics available, and the one measure that actually matters.
LOOKING AT cost per click, cost per lead, relevance scores, etc are a GREAT way to determine how your ads can be improved and provide some guidance on where the issue is for underperforming campaigns… but they CANNOT tell you if your ads are actually working and worth putting more money into.
What’s possible with Facebook and Instagram ads, is the ability to put $1 in and make several more back — on repeat. Given this context, what else other than profitability could possibly matter?
Need support creating campaigns that will grow your bottom line? Click here to apply for a FREE Facebook Ads Audit with yours truly.
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