In Part 6, you discovered how to track your conversions as well as to set up your ads on Ad Manager.
Now it’s time to manage your Ads for profitability.
Before we start managing your ads, we need to learn how to use Facebook’s Ad Reporting tool.
Facebook Ad Reporting
The Ad Manager has one of the most comprehensive reporting tools for advertisers.
In this section, I’ll be sharing more about how you can use the default reports for quick views and how you can customize the report for your own campaigns.
When you go to your Ad Manager, you’ll see the dashboard below.
On the top right hand corner, you’ll have the option of adjusting the period of the data you want to look at.
I recommend using the default “Lifetime View” first.
The default reports provide a quick overview of your campaign performance, depending on your objectives.
Here’s a quick summary of the options available to you:
The most commonly used one are “Performance” and “Delivery”.
Of course, depending on your objectives, you might want to look at the rest of the default reports.
That said, my preference is to create my own report so I can focus on the right numbers and manage my campaign easily.
Depending on what you want to measure, you can adjust the columns of the report.
Here’s how you do it…
- Click on “Customize Columns”.
- You can enter the metric you want to add the report by typing it in the search bar. In this example, I typed “link” to look for “CTR (Link Click-Through Rate)”.
- You can select the report you want and it will appear in the report.
- It is useful to adjust the report by moving the relevant columns together. In this case, I drag and drop the “CTR (Link Click-Through Rate)” below “Link Clicks”.
- I recommend saving the report as a pre-set before clicking on “Apply”. In the example below, I’m saving it as “Testing”.
- If you’re going to use the report often, I recommend you save it as a “default” when you return to your main dashboard.
The biggest mistake that most advertisers make when it comes to managing their ads is to make conclusions based on a very small amount of data.
The problem of doing this is that small changes in your data will make a big difference to your overall conclusion.
Let me give you a simple example.
Let’s say you run a campaign and you get data like this:
You can immediately conclude that the ad is converting well.
But the first few conversions could be a lucky break and you never know if the ad will continue to convert well if it continues to run.
This is because it’s possible that the ad continues to run, spending double with the conversion remaining the same.
Similarly, just because an ad works this week doesn’t make it will work next week.
Maybe this week is an exception because it’s the week your potential customers get their pay check and they are more open to spending.
Or there is some special holiday or celebration that is pushing up the sales.
For example, sales tends to increase closer to Christmas and Cyber Monday.
So here’s our best advice.
Make sure you have significant data before jumping to conclusions.
If you are wondering what exactly is significant data, here are a few guidelines we use when managing our own ads.
Minimum: 1 week e.g. Daily Variances
Better: 1 month e.g. Pay week
Ideal: 3 buying cycles (with minimum of one month)
Minimum: 300 link clicks per ad
Better: 500 link clicks per ad
Ideal: 1000 link clicks per ad
Minimum: 7 conversions per ad
Ideal: 15+ conversions per ad
In short, you do not say that an ad works until you get at least 300 links clicks and/or 7 conversions on the ad, and you run it for a minimum of 1 week.
Again, these are guidelines.
There are cases where you might want to ignore some of the guidelines.
For example, if you are on a tight schedule and you want to shorten the testing cycle, you might want to put in more budget and run the ads for 3 days before making conclusions.
As long as you keep in mind that your data is not entirely accurate, you can modify your ad management plan accordingly.
The 4 Stages Of Campaign Management
When it comes to campaign management, there are basically 4 different stages you’ll usually go through.
Different experts will have different campaign management strategies but what they do can usually be categorized in the four stages.
This is the stage where you’ll be spending a bulk of your time, effort and resources.
The objective of the testing stage isn’t necessarily to be profitable. It is to find a target group and/or an ad that converts.
Many advertisers get stuck at this stage because they are aiming to be profitable during the testing stage.
Remember, you might luck out every now and then, but majority of the time your campaigns and/or ads are not going to be profitable.
Another mistake they make at this stage is to use the wrong process when it comes to testing. And when things don’t work out, they have no idea what to do.
I’ll be sharing a simple testing process later in the guide.
Once you found something that worked, you’ll work on reducing the cost and improving the overall Return On Advertising Spend (ROAS for short).
At this stage, you are usually focusing on increasing your CTR and lowering your CPC. You’ll be spending a bulk of the time split testing different ads.
The key is to remember that there is a limit to how low you can lower your costs. Don’t get too obsessed about getting the lowest cost.
If I want to improve my ROAS, my preference is to work on improving my Average Order Value (AOV) by tweaking the funnel.
Once you find something that works, your next objective is to increase your revenue while maintaining a good ROAS.
At this stage, your advertising cost will usually go up over time as you try to get more sales from your working ads and target groups.
Your overall ROAS will drop but you can enjoy higher profits (not profit margin) with the increased sales.
While you can usually get results very quickly from Facebook, you will find your ads dying out fairly quickly too.
This usually happens when the same audience have seen your ads too many times, resulting in ‘ad blindness’.
It is important to always prepare and launch off variations of the current winning ads along the way.
The stages are not linear – meaning depending on how much budget and time you might have, it is not necessary you need to go through each stage.
For example, you might find something that worked in the “Testing” stage with good Return On Advertising Spend (ROAS) and decide to jump straight into “Scaling”.
This is the approach that many performance marketers take.
In this guide, I’ll be focusing primarily on “Testing”, because it is the first and most important stage of the process.
If you like to learn about the other stages, you can check out the GrowthX membership where I cover them in more detail.
How To Do Testing
Like I mentioned earlier, when I’m doing testing, I’m not aiming for profit.
I’m aiming to get conversions so I know I’m going after the right target group and I have a message that works for the target group.
And because we’ll be testing different things to find something that works, you can expect to spend more during the testing phase.
I’ll set up the campaign in a way where I’ll be testing different types of target audiences.
For example, if I’m doing a campaign for a probiotics weight loss supplement, I might try a couple of target groups:
- People interested in probiotics
- People interested in different diets
- People interested in alternative medicine
Each of these target group make up the Ad Sets for the campaign.
I’ll write specific ads (usually about 3 ads per target group). Each ad will have a different angle to see what clicks.
Here’s what the initial campaign setup is like:
Another interesting setup is to duplicate each of the 3 ads.
The rationale is that by doing this, the individual ads will get enough reach so you collect data faster.
This is how the campaign setup look like:
I know there are some advertisers who recommend running split tests on one ad right from the start.
But I recommend against this approach because running a split test on an ad or target group that doesn’t work is just wasting money.
I prefer to find a target group and ad message that converts first before proceeding with split testing to increase the Clickthrough Rate (CTR) and reduce the Cost Per Action (CPA).
Let’s Start Managing Your Ads
My preference is let the ads run for at least 1 week to take in account different behaviour on different days of the week.
At the same time, if you have limited budget, feel free to let the campaign run until you collect enough data.
Note: If you are wondering what is “enough data”, you should be looking at a minimum of 300+ link clicks per ad and/or 7+ conversions per Ad.
If there are ads that don’t get enough conversions, let it run until it hit your 300+ link clicks before concluding that it doesn’t work.
Once you hit 7+ conversions for one of your ads within one Ad Set (target group), you can proceed to the optimization stage.
There are some cases where your cost per link click and overall ad spend is just too high due to a poorly written ad or the wrong message.
In this case, you’ll have to decide whether to continue with the test or not, even when you haven’t hit 7+ conversions and 300 link clicks per day.
You can use Ad Spend as a condition – if I spend $XXX amount on this Ad Set and it’s not working after 3 days, I’ll pause the Ad Set or create new ads to test within the Ad Set.
We reached the end of the “Ultimate Guide To Facebook Advertising”.
This is really the start of your advertising journey.
If you want to learn even more about Facebook Advertising…
Along just about every other traffic source you can tap on to drive more traffic, sales and profits for your business…
I recommend you check out our newly launched “GrowthX” membership.
It’s an exclusive membership where top media buyers and advertisers will be sharing their best strategies and tactics on high quality traffic sources such as:
– Google Adwords
– Google Display Network
I could go on and on about the value of having professional media buyers guide you through the whole process of launching highly profitable campaigns consistently.
All the best!