The Three Layers Of a Successful Facebook Campaign
Whatever we may say impressions are no longer a KPI businesses are penchant for taking into consideration when it comes the time to determine the success of a marketing campaign. Truth be told, some branding-focused giants like Coca Cola, McDonald’s or Red Bull still need to secure their inventory slots no matter how much money returns at the end of the day but true is also that for the remaining 99% of online worldwide marketers (especially SMBs which cover most of the Facebook advertising space) the only thing the matters is ending up ROI positive at the end of the fair.
Facebook offers you different solutions for your marketing goals but most of those are just preparatory steps to keep your audience warm in order to bring some good cash in eventually.
For counting with a total population of +2B users, for the granularity of its targeting, for its unachievable organic engagement rate (an active user checks Facebook more than 10 times a day on average spending +20 minutes on the platform daily) and a sophisticated ability to track any taste or behavior a person shows and subsequently predict a buyer’s intents like no others, Facebook is the house where every business has to live.
When we launch a campaign on Facebook we are competing on an auction to get an advertising spot on a specific Facebook placement within a user’s profile. Unlike all the other Ads auctions (Google, Snapchat, Twitter etc.) based on a second-price model, the Vickrey-Clarke-Groves auction allows advertisers to win a higher percentage of spots even if their economic bid does not represent the highest monetary value on the table and sometimes pay even less than the 2nd highest value at stake.
In the extreme complexity of predicting human-based behaviors and so the likelihood of a campaign success there’s no so much room for an advertiser to operate on other than just 3 layers:
1) Budget/Bid; 2) Targeting; 3) Creative;
Wherever you may look for, the key to success is always to be found within those 3 elements. If you bid your true value; target appropriately; test, iterate, improve and refresh your creatives, your campaign will succeed.
Budget.
When you set a budget, you are telling Facebook what’s the maximum amount of money you are willing to spend on a campaign on a given time. You are not reserving any advertising space with that money as the VCG Auction awards businesses that serve relevant ads to their potential customers in order to offer a positive experience on the platform both to the advertisers and to the users and obviously to Facebook itself whose ideal mission is to create a genuine and relevant ecosystem helping advertisers find people who matter to them and helping users discover what matters to themselves. This in other words means that despite how high your budget is, if your ad is not relevant to your targeted audience it will not be shown.
Facebook gives advertisers the possibility to choose between a lifetime or a daily budget. Unless for whatever reason you are obliged to spend an even amount of money every given day there’s no need to use the daily budget feature which could actually be forced to consume your money on a given day despite the system is able to foresee more valuable opportunities in other cycles of the campaign lifespan. Whenever you establish a start and end date, the Facebook Pacing, through its probabilistic throttling, indeed makes sure to qualitatively maximize the advertiser’s budget according to the best opportunities that predict to happen along the journey. The accelerated delivery feature, on the contrary, overrides the paced system trying to win every ad auction it may encounter in the shortest time possible, alas accelerating your chances to waste your money. Unless your offer is ending in 2 hours you should never go for this delivery optimization. When using a daily budget, the predictions are calculated on a daily timeframe, which means that whatever change is made the performance will be highly impacted during the rest of day. With the daily allocation type it’s always suggested to make improvements in the initial part of the day as the system will have time to re-calculate for the best opportunities and move according to the responses the ad gradually gets. If this move is performed close to the end of the day the FB catalyst will have fewer data to analyze and will spend the due percentage of the budget to actions that are not worth-it. For the same reason, it’s also advisable to decrease the budget during the last hours of the day.
Despite increasing or decreasing the budget are not direct indicators of a performance shift, it must be taken into consideration that a gradual increase - while keeping the same set up - may generate better results as the algorithm will be able to historically get more useable data (a budget increase will also lead to an initial increase of the Cost per Result which should adjust overtime as the system gets more and more responses) in the same way as decreasing it - unless we were way over-budget - will surely lead to minor results. Mind you that while a budget shift needs 15 minutes to take place a bid change occurs immediately. In the case where both must be edited, it’s always recommended to move the budget first, pause the ad set and wait 15 minutes before changing the bid, making sure that the daily budget is constantly at least 5 times higher than the bid (20 times ideally).
Bid.
Facebook makes more than 80% of its total revenue from advertising, though, as said there is a limited number of advertising spots available every day as Facebook doesn't want people to only see ads. To get those spots you'll have to bid against your competitors who not only are the ones whose business is similar to yours but simply every business targeting your same audience (Ex. On Father’s day a Tie shop and an electronic store will likely end up competing in the same auction).
When you set a bid, you are telling Facebook how much you value the result you are maximizing your campaign for (impressions, video views, conversions, clicks etc.), choosing the wrong campaign objective or optimization method will drastically compromise your campaign’s goal. The suggested bid that Facebook gives you when you go manual is a very useful feature as it shows you what’s the average bid of the businesses that are targeting your same audience. As for the system it is very hard (as of right now) to calculate each one’s true value which is different from product to product and from business to business it just gives you an estimate of how much advertisers in those potential Ad Auctions will be bidding in that specific moment, mind you that while the suggested bid is hopefully a good indicator to win a reasonable number of auctions it not be good enough to end up ROAS positive. As you will hardly ever pay your maximum bid, your true value is the only thing that really permits you to stand out from your competitors and maximize your Facebook campaign at the same time.
Bid your True Value = Customer LifeTime Value - Cost of Doing Business - Desired Profit
In a nutshell, your true value is the maximum price you are willing to pay while still keeping a profitable margin. The formula above basically means that bidding less than your true value will make you lose lots of opportunities, reach a small part of your potential audience and underdeliver, while bidding a higher value will probably increase your Cost Per Result and therefore have you pay a higher amount of money for what you could have gotten at a cheaper price.
1) The Automatic Bid comes in handy especially for branding and reach objectives, broad targeting, budget constrained campaigns and for those advertisers who initially have a hard time calculating what their true value is. You basically let Facebook drive the car which will strive to grant you as many opportunities you can get at the cheapest price (which is to say not racing for the users with the highest action-intent in the market as you should never look for highly-value conversions by broad targeting).
2) For all the remaining cases (Direct Response Campaigns, High Value CA or Nested Lookalikes, Niche Interests and Behavior-based targeting) it’s time that you put back your hands on the steering wheel and go manual, bid bravely and make sure to have a competitive budget (as already said approx. a daily budget which is 20 times higher than your competitive bid).
TIP: The smaller the audience the higher the bid, if your audience is pretty big go automatic.
Bid High for Lookalikes and CAs;
Bid Mid-Range for Interests targeting;
Bid Low for Broad Targeting not to miss any opportunity;
Both bid and budget should not be changed too much as it takes time for Facebook to collect data of the users who are responding the most and try to put your ad in front of people with similar characteristics. The bigger the audience the more time it may take. Usually it is advisable to wait at least three days before making any campaign analysis and not changing the budget or the bid more than 2/3 times a week. As not being a traditional auction bidding more doesn’t change the cost (if you win the same position) but decreasing the bid is hardly ever a promising solution; even though you are paying less than what your bid is, lowering the bid will likely make you enter lower quality auctions, limit your reach and make you pay about the same. Though, due to infinite amount of Ads Auction held daily, it’s always suggested to go automatic or bid-constrained rather than budget constrained. A high bid on a constrained budget will tend to consume the money pretty fast on a couple of expensive results.
Bid Types. CPM, CPC, OCPM, CPA
CpM = Good for: Branding; Recommended Audience Size: 0-1M
CpC = Good for: Traffic and Engagement; Recommended Audience Size: 50k-1M
OCpM = Good for: Conversions Recommended Audience Size: +150k
CpA = Good for: App Installs; Recommended Audience Size: +150k
Take into consideration that CPM optimizes towards impressions (the highest number of impressions at the cheapest price) while all the other bid types will reduce your total reach by only looking for the Facebook users who are most likely to take the action you want (a click; a purchase or an app install). This means that whenever you have a relatively small, exclusive and high-value audience who has already heard about you or showed an interest for your products (Ex. High Value WCA or Retargeting list) it would not be convenient for you to go for more expensive bid types.
Whether you bid CPM, CPA or CPC you can still be charged for the action you think could be the real deal for you. This is a crucial factor that most of the times is not enough considered as some advertisers tend to think they always pay what they optimize for. My suggestion is to pay for what you are bidding for. (If you optimize for clicks you’d better not pay for impressions as it’s thinkable that Facebook also wants to maximize its revenue... a little bit of A/B Testing here can help you make the best decision and compare the number of impressions served).
Targeting and Creative.
As seen, if your bid is not the highest on the table you may still have enough chances to win the Ads Auction, if your creative isn’t the catchiest your most loyal customers may still click and buy but if you show a bra Ad to men-only your chances to succeed are equals to zero (unless it’s Feb 13rd and it would not be a great present whatsoever). Therefore, putting your ad in front of the right people is probably the most important of the 3 layers mentioned above.
When it comes to targeting Facebook offers you an open-wide ocean of possibilities, while this is a big advantage it’s also a very difficult challenge as using the wrong one may totally compromise an excellent set up. Both the audience insight platform and the audience estimate indicator are tools way more useful than what you may think. When setting up a campaign always have a look at your daily reach on the right column, make a generous average of it and divide it by the daily total reach, this can help you understand what should be the length of your campaign if you want to reach your full audience while succeeding in keeping a low frequency; if it takes too much time to serve all your audience you should drive your budget way up. For DR campaigns with core-targeting you should aim to reach the most valuable 10% to 20% of your total audience.
It is extremely important that you will not have your campaign underdeliver which meaning you don’t leave a good part of your budget on the table. This is always related to setting too many constraints to your delivery, targeting-wise the most frequent mistakes are:
1) You are targeting the same audiences in different campaigns/ad sets. If you target the same people with different ad sets, they may end competing up in the same auction, while the best one will get delivery the other one will be brought down and have a limited reach or not perform at all. (Check the audience overlapping tool in the Ads Manager and make sure it never passes a 15% overlap with smaller audiences or 25% with bigger ones). If it’s over that percentage it shouldn’t be difficult to consolidate different ad sets into the same one, otherwise try to use exclusion targeting (CA or LA from other ad sets). Remember that your page fans can see your ads max 4 times a day while a non-fan can see your ad maximum 2 times a day, by using the same targeting it will be hardly possible to have multiple campaigns/ad sets delivering in full force.
2) Trying to be too selective without realizing to be narrowing the audience too much.Take into consideration of not launching a core-targeting OCPM campaign with a total potential reach of less than 150k and a branding campaign with a potential reach of less than 5k daily users to say the least.
TIP. Use broad audiences for branding campaigns, use quality and limited audiences for DR objectives.
3) Increasing the budget on an ad-set should not impact the delivery, though having a large potential audience without a competitive budget (Ex. it would takes 1 year to reach your estimated audience) can be a blocker on the long run.
4) You didn’t select flexible placements to increase your delivery. Though, remind yourself that you are talking to a computer and subjective recognition is not taking into consideration. Flexible placements is a good idea, using placements that are useless for you is a bad idea. If you tell Facebook you want to show your Ads on FB, IG and AN at the same time just to extend your reach and decrease your CpR, do not complain then if 99% of your results happen on IG as the system tries to deliver your Ads where the lower cost per result is and where it’s easier for you to win the ad auctions and have visibility. Try to reach your audience when they are most likely to take the action you want; different actions may belong to different placements as they may belong stages in the funnel. Messenger and especially the Right Hand Column are great tools for retargeting while would not work for branding (they are no longer eligible for these objectives indeed). The Suggested Video placement is your placement if you want people to carefully see your video and have a high Ad recall lift. In IG you can find a type of audience who is more active and ready-to-buy for specific verticals such as retails, e-coms and gaming while it may be more complicated to collect leads for retirement plan packages in a platform overpopulated by millennials. The last updates on Audience Network Ads are awesome (Interstitial ads, In-Stream Videos) but be mindful that depending on the format they can be at the same time extremely easy to click or hardly viewable (banner Ads), CtR or Impressions aren’t yet the most reliable KPIs for this placement.
5) Customize your Dashboard columns in the Ads Manager and have a look at the feedbacks of your creative. If you are experiencing low positive feedbacks try to understand why you haven’t been relevant. The ideal condition is when you see high positive feedbacks and a low amount of negatives. Keep in mind that a negative feedback (people hiding or x-ing out your ads, a high bounce rate, too much text in the image and other factors that will limit your competitiveness) weigh way more than positive feedbacks in the relevance scale, so even if they are both on medium or high you should not be happy. The relevance score on the ad level is a prediction of how well your ad will be doing in the next ad auctions and it updates every 500 impressions. If it’s 6 for instance it means that your creative will probably win 6 auctions out of 10, if it’s been stuck at +7 for a while it’s high time you increase your budget and bid and enter more valuable ad auctions. Creative can influence both CTR and CVR just as much as targeting does, the higher the relevance the cheaper the price. Use a compelling creative with an explicit message and a clear call to action button, try showing different ads targeting the same audience, or the same ad targeting different audiences. Use 3 to 6 ads (depending on the audience size) per each ad set and do not create more than 8 ad sets per campaign. Your ad should be customized to the people you serve and the objective you chose (Lead Campaign > Lead Ad, Branding Campaign > Rich Media, Video or Slideshow DR > Carousel Ads Link and Dynamic Ads - Carousels have statistically a 30–50% lower cost per action and a 20-30% lower cost per click - Canvas and Collection Ads are good for everything but do not excel in anything). Ensure the Frequency of your creative isn’t too high. Unless you are experiencing unbelievable results avoid Ads fatigue, frequency should never be higher than 3, passed that number refresh the creatives otherwise the eCTR/eCVR will drop along with the relevance and therefore the delivery and subsequently the cost will rise. Use Daily Unique Reach for branding campaigns and when frequency spikes while targeting small audiences. A high frequency basically means two things: 1) The audience may be too small 2) Your audience is not responding to the action you want and so they’re shown the ad again and again; this means that your target needs a complete overhaul.
At the end of it all, it’s important to understand that there’s no one-size-fits all approach. The ad auction is a dynamic marketplace and the behavior of the users and the competition in a specific moment can be predicted to a limited extent. A creative that worked last year, last month or even last week not necessarily will work again now and probably has even fewer chances as your audience has already been exposed to it. Facebook Marketing mastery requires much more practice than theory.
As long as you’re having good results there’s no need to apply any change to your campaign, start working on those three layers just on two occasions:
1) When setting up your initial strategy;
2) When experiencing a performance decrease or results are not as good as expected;
The best campaign performance and delivery requires testing and iteration, an in-depth strategy and customized analysis which can vary from case to case, from one type of audience to a different one and from one business goal to another.
Dario was an Account Manager for Facebook for almost 2 years guiding EMEA SMBs to establish successful Facebook strategies and increase their ROI. He then worked as Account Strategist at AdGlow - a Facebook, Twitter, Amazon, Snapchat and Pinterest Marketing Partner - scaling the online advertising activity of big brands and media agencies mostly on Facebook, Instagram and Snapchat. He then founded TechSounds where he currently helps various businesses globally to make their brands resonate on social media platforms through online advertising.