How To Know If Your Facebook Advertising is Working

May 7, 2014 | Facebook, How to

“How do I know if my Facebook Advertising is working?'”

If you are spending more than $100/day in Facebook Advertising and you don’t know how to tell if it’s working, we’ve created a simple test to help you figure it out.

First, to make sure we are all on the same page, answer these questions:

  1. What is the action you want people to take on your website? Is it to buy a product? Fill out a form? Read the content? If you want to evaluate performance, you need to first know what you are measuring.
  2. Secondly, have you been measuring how many of those actions were caused by your advertising in the last 30 days?
  3. Next, have you calculated how much you are paying on average for each successful action? This is easy – you simply take the total cost of all your advertising, and divide it by the total number of actions (we call them conversions) you’ve earned with that budget.
  4. Now you should have a number that represents your “Cost of Customer Acquisition,” or COCA for short. You just calculated a 30-day average. What is more useful is to calculate a 3-day running average, over the last 30 days, to see what direction it’s moving.

Ready for the test? Ok, here we go:

Over the last 30 days, has your COCA decreased by at least 50%? If not, then you may have a problem. Here is a graph representing recent performance of our clients:

Facebook Advertising Performance - cost of customer acquisition over time

Our clients, which include a subscription menswear company, a B2c appa fitness B2c company, and a testing center, consistently show a drop of at least 50% within the first 2-4 weeks.

Not seeing these types of results? Here are some things to consider:

  • Are you optimizing your campaign for conversions?
  • Are you using structured testing to evaluate the effect of different images and headlines on ad performance? Click here if you want to learn more about how we use a structured testing process to lower our client COCAs.
  • Are you using structured testing to evaluate the effect of different audiences on ad performance? (this should always be done AFTER image/headline testing)
  • Are you using lookalike audiences? This is one of the most surefire ways to lower your COCA!
  • Are you using site retargeting? This is another piece of low-hanging fruit that can help lower your acquisition costs.

Hopefully this post has helped you sort out your Facebook Advertising campaigns. If you need any help, leave a comment below or shoot us an email.


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