5 Valuable KPIs of Facebook Ads

D. Dixon
I'm a former rat-racer, lapsed Computer Engineer, who left the US in July 2011 (after 26+ years) and returned to my homeland Jamaica WI. There I started a farm business, became an online business entrepreneur and social media blogger. I mostly write for my social media business blog 1!SingularSensation as well as EzineArticles.com and a few other places. Recently I created a series of e-books called BackIIBasix© (aka BIIBx). Check out my growing list of E-books including Blogger Secrets: How To Create A Blog & Earn Money.
D. Dixon
D. Dixon
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KPIs of Facebook Ads

Assessing marketing results has always been about data and key performance indicators (KPIs). With Facebook Ads, it’s about looking from a more social perspective.

When I wrote my earlier article about getting exposure with Facebook ads, I had no idea it would generate such a response. That was when I decided to really don my marketing analyst cap and take a deeper look at my advertising test campaign.

My primary goal of was to get more eyes on an e-book I had written in February 2012. Users could download a free sample of the book on their e-reader before deciding to buy. On the off-chance that there would be sales, my secondary purpose was to have a trail of data that would give me an idea of who bought the book, on what device, on which days…basically link Facebook ads to sales ROI.

I’m still waiting on the publisher stats for that last part but in looking at some of the key performance indicators (KPIs), I became even more impressed with just how much data I could use. With the inherent social aspects of Facebook ads, the KPI terms took on a slightly different context:

  • Frequency – The number of times the same person saw the same ad.  A healthy balance happens  between over-saturation and being almost invisible to users who barely see your ad.  Advertisers can’t really control this KPI outright when they’re creating their ads, which is a blessing, if you think about it.
  • Social Reach – Regular reach is the number of people who saw your Facebook ads but with social reach, you’re now talking about the number of people who saw your ads with the names of friends who liked, shared, used your app or page.
  • Social CTR – The regular click through rate is calculated by dividing the number of clicks by the number of impressions. The difference with social CTR is that now we see how many of the Facebook ads with social context are shared by the users:  Social CTR (%) = Social Clicks / Social Impressions
  • Inline Fans – The number of people who clicked on the “Like” button in your advertisement.
  • Total Interactions – While this number can come from duplicated actions, when compared to another KPI like Inline Fans, you can use this metric to gauge what percentage of interactions led users to like your page or post.

Over time these and other KPIs can become baseline for future campaigns.

But what about the campaign itself? When looking at how your Facebook ads and the KPIs they produce figure into your strategy as a whole,  here are a few best practices to remember:

Know what you want the audience to do – This may seem like a no-brainer and that’s why it’s easy to miss. Do you want audiences to click on your link, like your page, use your app…? The most important thing to do here is to tell them by using a call-to-action.

Do A/B testing – This means launching multiple Facebook ads with different text, graphics, vehicles and seeing which one had better responses that fulfill your goals.

Keep an eye on your metrics – There are plenty of metrics that matter such as campaign reach and CTR, Response – is the audience responding better, worse or the same? Make sure you know which ones matter to your campaign and how they’re doing across the board.

When it comes to CPC and CPM, do a little money math – This may seem like it’s overkill because they give you the numbers in the reports but let me share with you a different perspective.  If you found out that CPC campaigns cost you more than CPM campaigns, which would you use? The answer seems obvious but the question you should ask is how do I find out? What I’m about to show you is something I found on a very cool site, and it’s definitely worth integrating in your analysis; it helped me to better understand the math of CPC and CPM.

The formula for converting CPC to CPM is:

CPC = (Total Impressions *CPM)/(1000 *Clicks)

Let’s start with the base assumption that 100,000 impressions equals 1000 clicks and the CPM for one of your Facebook ads is $12. Based on that formula you’re looking at a CPC is $1.20.

To convert CPM to CPC, we rework the formula above to show that:

CPM = (CPC*clicks*1000)/Total Impressions

Say we have a CPC campaign going where we’re spending $5 for the same impressions and clicks. Doing the math we see that our CPM cost is $50. Now based on your strategy, the CPC of $1.20 may work better for your budget OR you could be getting more interaction and engagement from spending $5 CPC. While this formula was not originally for Facebook ads, it’s the best one I’ve found that really puts things in perspective, especially your budget.

Taking the time to work with Facebook ads and understand the KPIs involved will help you to figure out how they are working (or not working) for you. 

Comments


  1. Twitter:
    Facebook ads are really great for advertiser. They can make most out of it. Nice post.
    Prakash recently posted..Best Antivirus for Android 2013My Profile


  2. Twitter:
    I was looking to use facebook ads..This post cleared up quite a few things..thank you
    Suraj recently posted..Lost Planet 3 Release delayedMy Profile


  3. Twitter:
    Advertising is always special in some manner, but when advertising is associate with Facebook, it becomes more special.Nice sharing about Facebook ads, Dixon. Thanks for sharing this with us.
    Mahendra recently posted..Upcoming movies of Aamir Khan 2013-2014My Profile

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