Optimizing Facebook Ad Performance: Right Campaign Objectives & Conversion Events for E-commerce
New to Facebook Ads? Not sure which Campaign Objective & Conversion Event to choose?
Even if you are running Facebook Ads for a while, but looking for potential ways to optimize & improve returns, use this posts a checklist to make sure you are applying all the best practices to get the best out of Facebook Advertising.
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Understand Campaign Objectives and Conversion Events
90% of businesses fail to get desired results from their Meta Ads, for not understanding how these 2 choices impact the performance of your advertising.
One of the most important decisions you’ll need to make when setting up your Facebook Ads campaign is choosing the right objective.
Meta has been rolling 6 Simplified Campaign Objectives lately moving from 11 Campaign Objectives in 3 Broad Categories.
What are you seeing in your Meta Ad Account? Hopefully, the 6, as shown in the below image:
- App Promotion
“Just choose the business objective that is aligned with your business goal” wish it was that simple!
Conversion Location & Conversion Events
Once you select the Campaign Objective, often you’ll be needing to select a Conversion Location & Conversion Event in the Ad Set level.
The conversion location refers to the specific place (Website, App, WhatsApp, etc) where you want your desired business outcome to take place.
Once you have determined the conversion location, you can then select the appropriate conversion event. The conversion event you select will specify the action (Content View, Add to Cart, Purchase, etc) you want your audience to take in order to achieve that desired outcome.
You can find all available conversion locations and events for each objective here. Here are the most important ones our clients often use:
|Objective||Conversion Location||Conversion Event|
|Leads||Website||Complete registration, Contact, Find location, Lead, Schedule, Search, Start trial, Submit application, Subscribe, View content.|
|Sales||Website||Add payment info, Add to cart, Add to wishlist, Complete registration, Donate, Initiate checkout, Purchase, Search, Start trial, Subscribe, View content.|
Cost & Competition vs Purchase Intent
As per Meta, whenever you are choosing a campaign objective, you are giving a signal to Meta Ads algorithm regarding:
What type of audience bucket you are after.
If you are running Meta Ads for a while, I am sure you are aware that you set the Audience in the Ad set level.
But depending on the Campaign Objective & Conversion Events (for relevant Campaign Objectives), you’ll reach different buckets of audience from the same audience pool that you select through your targeting at the Ad set level.
This is one of the most important understandings in running Ads on Meta or online advertising in general. And there are a lot of misconceptions and confusion around it.
Let’s understand this with an example.
Say, you are selling Sports Shoes in the US. And you set a target audience in the Ad Set level: Male, USA, Age: 24-50. Interested in: Nike, Adidas.
Now, consider everyone in the Meta ecosystem matching the above targeting criteria as a river or pool or water body.
As an advertiser, think of yourself as a fisherman wanting to fish from that pool.
Would you expect the fish to be uniformly distributed throughout the pool of water? No! You are going to find different qualities & quantities of fish in different buckets or different areas in that pool.
Now think that quality & quantity in terms of Purchase Intent i.e. how likely they are going to purchase your products or services or take up your offer.
Higher campaign objective (& conversion event) you choose from the above graph, you are going to show your ads to higher quality audience bucket, as per Meta’s data.
Obviously, Meta is going to charge you higher to reach a better quality audience that has the highest competition from advertisers.
Are you with me so far? Good!
Let’s start from the bottom of the above graph:
- Awareness: Lowest cost. Lowest purchase intent. Reach the maximum number of people from your audience pool within your budget. But as per Meta, they are less likely to engage, visit your website, convert to lead, or purchase.
- Engagement: Costlier but better quality, compared to Awareness. You are not going to reach as many people from your audience pool, as you could with Awareness, within your budget. But as per Meta, they are more likely to engage with your ads/brand. But less likely to visit your website, convert to lead, or purchase.
- Traffic: Costlier but more likely to visit your website.
- Lead: Costlier but more likely to convert into a lead.
- Sales (Conversion): Costliest but more likely to trigger website events like:
- Content Views
- Add to Cart
Talking in terms of KPIs, your Cost per Reach increases as you choose higher campaign objectives & associated higher conversion events. Why would you do that?
Why would you spend same money & reach fewer people?
You would do that because Meta is saying:
Though your Cost per Reach is going up 🔺, choosing higher objective and event should bring your Cost per (business objective) action down ✅
Let’s return to our above example where your business objective is selling sports shoes.
Meta is saying that choosing Campaign Objective: Sales & Conversion Event: Purchase will have the highest Cost Per Reach (i.e. you’ll reach the lowest number of audiences from your target audience pool) but the lowest Cost Per Purchase (i.e. you’ll get the highest number of purchases from your target audience pool), within your budget compared to what you could have gotten using other Campaign objectives.
It’s easy, right?
Do you want purchase? Run Sales campaign. Want leads? Run Leads campaign.
Ah! I wish it was this simple! 😭
Going after the costliest & most competitive audience buckets works as long as they convert and the Cost per (business objective) action is within desired/acceptable range. What if they do not convert or Cost per (business objective) action is not good enough? 🤯
What if the outcome is not worth paying top dollar for?
Meta Ad Targeting Dilemma – Quality Traffic vs Wider Audience
This is what drives advertisers mad! 😖
Should we go after Quality Traffic or reach a Wider Audience?
Say, you are an eCommerce brand & you are going after the quality traffic running Conversion(Sales) Campaign with a ‘Purchase’ conversion event. If it works, awesome!
What if it doesn’t? What if you get no/low sales? Low ROAS & High Cost per Purchase – that’s unsustainable.
So you’ve shown your ads to a very costly limited bucket from your target audience and didn’t get the results you hoped for.
You could have reached more people, getting more traffic to your site from your target audience, with the same ad spent, if you’ve chosen a lower campaign objective and/or conversion event.
What if those Meta didn’t consider a ‘quality audience’, and could have bought your products?
Now think about the opposite strategy. This is more similar to traditional offline advertising.
You decide to go after a wider audience with a Traffic Campaign. For the same budget, you are able to drive much more targeted website traffic to your eCommerce store, compared to what you could have done with a sales campaign.
If the conversion rate is brilliant, you get enough purchases to hit your target ROAS / Cost per Purchase.
What if that doesn’t happen? Though you get a lot of website traffic from your target audience, they keep dropping off throughout Content Views > Add to Cart> Checkout > Purchase. And the ROAS / CPP isn’t good enough.
If you have already experienced this, you know the pain & frustration. 😓
If you are hearing this for the first time, you must be confused, right?
Let me tell you a bitter truth
For any business owner, the idea of advertising and marketing is attractive – the thought of reaching out to more potential customers and boosting sales is appealing.
However, it is not as simple as it may seem.
Running successful ad campaigns can be incredibly difficult, and with each passing day, ad platforms are becoming increasingly competitive.
Getting profitable results is becoming more challenging than ever before.
With so many people promising overnight success, it’s easy to fall into the trap of thinking that success is just around the corner.
However, this is not always the case. Running ads and getting profitable results is incredibly difficult, especially for smaller businesses with limited budgets.
So what’s the solution?
There is NO Easy Solution.
It’s essential to test and find what works for your business, depending on your budget, products and services, market, and niche. Testing can take months and a lot of budget before you figure out what works for your business.
It’s crucial to have a testing budget, realistic expectations, and a timeline.
It’s also vital to understand that
what works for your business today may not work for your business tomorrow or next year.
Ad platforms, social media platforms, the market, the economy, technology, and consumer behavior are changing rapidly.
Therefore, as a business owner, it’s crucial to keep testing.
Many businesses give up on ads, saying they don’t work. The key is to keep testing, and it’s essential to be prepared for the challenge.
If you’re prepared to take up the challenge, then advertising is for you.
However, if you can generate profitable sales through other channels, there’s no harm in exploring those avenues.
Most businesses complaining ‘Ads are not working’, unfortunately, do not have any other channels driving profitable business results either. The problem then is highly likely beyond advertising or marketing in general. But that’s a topic for another day.
If you do not have other channels driving profitable business results for you, I sincerely wish that you have patience & realistic expectations from Advertising.
Here is a very popular quote among advertisers:
If you really want to get the best out of your advertising budget, you have to be willing to spend a lot of time & money first in testing & figuring out what works for you.
If you haven’t already left by now, searching for an easier/simpler/faster solution, congratulations. You’ll survive & hopefully thrive in this game.
And here are
based on our practical experience working with advertisers from 60+ countries.
These are not ‘false promises’ wrapped with ‘hollow guarantees’. Rather, consider these as ideas for you to start testing or nudge you in the right direction.
Start from the bottom if
- Ad budget < $100/day OR
- Pixel is new OR
- Business is new
Start testing from the bottom & then move upward if things do not work out.
- If your desired business result (store visit, call, message, brand awareness, etc) doesn’t take place on your website/landing page, start from Awareness.
- If your desired business result (lead, add to cart, purchase, etc) takes place on your website/landing page, start from Traffic. Similarly, while running Conversion(Sales) campaign, start from the ‘Content View’ event.
Start from the top if
- Ad budget > $100/day OR
- Pixel has enough Purchase events
- Mature Business
Start testing from top (Sales – Purchase) & then move downward if things do not work out or to test possibility of getting better ROAS or CPP.
Pixel Less Funnel
This is an interesting strategy, that you might find useful, either you have a limited ad budget or you want to run more targeted retargeting ads for each of your products.
Our Agency has been testing this for many of our clients for a while. But I heard this specific term from Depesh Mandalia on the Podcast below:
[If you really want to dig deeper into Profitable Meta Ads, I strongly recommend Depesh’s program – 7 Figure Meta Ads Playbook.]
This strategy tackles the following problems:
- With a limited budget, your prospecting / COLD campaign can reach a wider audience with ‘Video Views’ (Engagement) Campaign Objective, especially when you are not getting sales running a Traffic or Conversion (Sales) campaign for the same purpose.
- Post iOS14, Pixel-based custom audiences have become a lot less reliable. As the Video View action is happening right within the Meta Platform, ‘Video Viewers’ custom audiences are generally much more reliable to retarget.
- If you have multiple products, this strategy can help you retarget audiences interested in specific products or product categories.
But then again, like every strategy, it works for some brands and not for others. Test & find if it does for yours.
Recommended Audience Targeting, Copy & Creative based on Campaign Objectives & Conversion Events
When you are choosing Higher Campaign Objective (e.g. ‘Sales’) & Conversion Event (e.g. ‘Purchase’) understand that you are trusting Meta Algorithm to find the right audience for you.
To be able to do that, Meta requires a larger audience, as large as possible while staying relevant for your offering.
That’s why it’s recommended to try broader audiences. That can mean different things though:
- If you have been narrowing your target audience down with ‘Must Also Match’ (e.g. Interest: Nike, Adidas. Must Also Match: Behavior: Engaged Shopper), you can go broader removing the ‘Must also match’.
- If you have been trying Interest & behaviour-based audiences (e.g. Male, 24-50, Interest: Nike: Adidas. Location: USA) try providing just the demographic without any interest or behavior. (e.g. Male, 24-50 Location: USA
Instead of creating different audiences for different buyer personas from your target audience, test targeted copy & creative combinations to connect & convert different buyer personas.
When you are choosing Lower Campaign Objective (e.g. ‘Engagement’ ‘Traffic’) or Conversion Event (e.g. ‘Content View’), understand that Meta is not going to find those who are more likely to convert.
Make sure your audience definition on Ad set level is as narrow & specific as possible.
Otherwise, you are going to attract a lot of junk engagement & traffic, that are less likely to convert.
As you are not filtering your target audience through Meta Algorithm, it’s incredibly crucial that you have a good converting funnel & smooth purchase journey to guide the potential buyers to your end goal.
Meta Advantage+: Give AI & Machine Learning a Chance
Test Meta Advantage/Advantage+ products but do not trust them blindly.
- Advantage+ Campaign Budget ( or ‘Campaign Budget Optimisation’ / ‘CBO’) works best with tested & top performing Ad sets & Ads.
- Advantage+ Placements (or ’Auto’ placements) work best for most, especially with Square creatives.
- Advantage+ Creative Optimisations can do wonders when you have limited creative resources and less strict brand guidelines.
If you can take only 1 advice from this entire piece, please take this one!
Do not spread your budget too thin ⚠️
If you are starting with less than $100/day, it’s okay to start with just 1 Campaign, 1 Ad set & 1 Ad.
Even advertisers with a higher budget, are shifting to a Simplified Account Structure with the least possible active campaigns, ad sets & ads to achieve their goals.
I strongly recommend checking Power5 if you haven’t already.
Setup Pixel & Conversion API (CAPI) Properly
If you are running Conversion Campaigns without proper Pixel & CAPI setup, highly likely you are wasting ad budget.
Meta has published 2 really easy-to-follow guides (from Desktop) on:
- Meta Pixel Installation Guide
- Meta Pixel Optimisation Guide (Includes instructions for CAPI)
We’ve found official Meta integrations for Shopify & WIX quite good. But for WooCommerce, Pixel Your Site plugin works better than the official Meta integration.
If you are running an eCommerce store but not running Catalog Ads, you are really missing out on great potential.
Especially if you have a large number of unique products.
Creating ads for each of your individual products manually can be very resource intensive yet ineffective. While guessing which products are more likely to perform on Meta Ads, can lead to a significant loss of opportunity as well.
Connecting your website catalog with Meta can open doors to many possibilities & opportunities.
Here is a detailed PDF from Meta to help you setup your catalog right.
Once your Catalog is setup, here are the top things to try:
Catalog Sales Campaign
Just keep in mind that when choosing this Campaign type, you’ll not be able to run static ads within this campaign.
You are going to see the following Catalog related options in the Ad set level:
You can choose to advertise all products from your Catalog or specific sets of products.
You can choose Audience for Prospecting or Retargeting.
If you choose Retargeting, you are going to get the following options:
Ad Creation Process is fast & intuitive!
💡 If you are running an eCommerce store, within 30 minutes you can launch 1 Catalog Sales Campaign with 1 Prospecting Ad set & 1 Retargeting Ad set without worrying about creatives!
Isn’t that helpful?
If you do not have the budget or don’t want to run a dedicated Catalog Sales Campaign, remember that you can choose to run Catalog Ads within normal Campaign & Ad sets as well.
So within a single ad set, you can test Catalog ads against your normal ads.
If you haven’t played with Catalog Ads, I will highly recommend doing so.
That’s all for today.
Hope this blog post helped you to understand Campaign Objectives & Conversion Events better, get a more realistic expectation from Advertising & a lot of ideas to start testing.
Don’t forget to let me know what worked and what didn’t for you.