## Independent site Facebook Drain, what metrics can measure the effectiveness of Facebook ads?

Do you want to know if your Facebook ads are effective? What key metrics should you track?

In this article, you'll learn about 7 important Facebook ad metrics to learn about, and how to find them in Ads Manager and what to do if you don't get the results you need.

**1, the return on advertising expenditure**

The Return on Advertising Expenditure (ROAS) is the amount of revenue generated for every $1 spent on advertising. In short, it's an indicator of facebook and Instagram ad results. You need to make sure that every dollar you spend on your ads will (at least) pay you $1 in revenue.

The formula for the return on advertising expenditure is simple: revenue, advertising, and ad spending.

You can determine the total revenue generated based on Facebook pixel (under the purchase conversion value column in Ads Manager) and then divide it by the total ad spend that generates that revenue.

For example, you sold 10 $27 products from your Facebook ad last week, bringing in $270 in revenue. To generate these sales, you spent $54 on Facebook ads.

Revenue , Advertising Expenditure , Return on Advertising Expenditure

270÷54 = 5

In this case, every $1 you spend on Facebook will pay you $5.

When the return on ad spending is positive (a multiple greater than 1), your ad revenue exceeds the amount you spend on advertising. That is, your ads are making money.

If your ad's return on investment is negative (less than a multiple of 1), you're spending more on your ads than you generate. That is, you are losing money.

Please note that the above calculation does not take into account other business costs, such as team expenses, tools, and software costs. We recommend that you take the remaining variable costs into account when calculating the return on advertising spend to obtain an overall return on investment (ROI).

To do this, add the total Facebook ad spend to the rest of your spending and divide it by your total revenue:

Revenue s /Ens., SEs, Expenses, Return on Investment

Monthly analysis makes it easier to analyze the cost and expense of this ad; visualize it, calculate your revenue for January, and then divide it by the sum of your january's ad spending and other expenses for the month.

Back in the previous example, you spent $54 on your ad, generating $270 in revenue. You also generate other variable costs of 73. If these numbers are replaced in the above formula, the ROI is 2.13.

270 s (54 x 73) s 2.13, which means that for every $1 you spend, you'll earn $2.13.

**2, purchase conversion value**

Facebook's Purchase ConversionS track the total value of purchases you've made through your ad campaigns.

In fact, Facebook Ads Manager shows the value of your purchase conversions, making it easy to see the total revenue generated by your ads.

You can calculate this number manually by entering your PayPal account and determining that revenue comes from this ad. However, the easiest way to calculate the value of a purchase conversion is to install Facebook pixel.

Installing pixel requires adding a small piece of code to your site to let Facebook know that the ad brings in that revenue.

To manually calculate the conversion value of your purchase, get the number of items sold and multiply it by its purchase price.

Number of goods sold x Cost of goods - Conversion value of purchase

In the previous example, you sold 10 items for $27 each, so the conversion value was $270:

10 x $27 x $270

The purchase conversion value will then be used to calculate the return on ad spending together with ad spending.

If your Facebook ad is valid and you're getting a sale, the purchase conversion value will be positive. However, if you see zero, it usually means there is a problem with your Facebook ad or the entire sales process.

**3, cost per purchase**

Cost-per-purchase (CPA) is a quick way to measure whether you are selling a single product at a profit or loss after considering advertising expenses. It tells you the total ad spend you need to sell a single product. It can also be used to quickly calculate the profit margin for a single project.

When you install Facebook pixel, Facebook automatically calculates the pixel for you under the "Cost per Purchase" bar in Ads Manager.

You can use this number and the purchase conversion value described above to determine the return on ad spend.

For example, the figure above.

Purchase Conversion Value , Cost per purchase , return on advertising spend

1735.20÷399.85 = 4.34

In addition, by subtracting the cost of each purchase from the price of the product, you can determine your profit margin:

Product price - cost per purchase - profit margin

In this example, you spent $54 on Facebook ads and sold 10 products. This means that you spend $5.40 per unit of advertising:

US$54 / 10 s US$5.40

If a product sells for $27 and you spend $5.40 on advertising, your profit margin is $21.60.

27-5.40 = 21.60

Remember to consider your variable charges so that you can see at a glance whether the cost per purchase (the cost you spend on acquiring new customers) is related to your business.

When your profit margin is positive (greater than 0), you're spending more on your ads than you spend on advertising.

When your profit margin is negative (less than $0), you spend more on advertising than you generate.

**4, sales leads**

A lead indicates that a user is interested in a product or service of their own brand, often defined as a person submitting an email address to subscribe to or choosing to receive further marketing, in relation to sales.

Each new email subscriber will be considered a lead.

On the other hand, if you're an e-commerce company that directly draws people to your sales page or online store, you may not have an email subscriber.

Each new visitor to your online store will be treated as a link click.

**5, revenue per lead**

Calculate your potential customer's revenue per earner (EPL) or per click (EPC) based on which side of the equation you are on.

The EPL is the amount of revenue generated divided by the total number of leads spent generating that revenue. If your business naturally completes the lead (or some form of subscriber or opt-in) via e-mail, you can use the EPL.

EPC is the amount of revenue generated divided by the total number of site clicks spent generating that revenue. If you take people directly to your sales page or online store (rather than selling by email), you can use EPC.

To calculate your EPL or EPC, you need to do two things:

· Your purchase conversion value (indicator 2 above)

· Number of leads (or clicks) (indicator 4 above)

Divide the purchase conversion value by the total number of leads (or clicks) to get your EPL or EPC:

Purchase conversion value , number of leads (or clicks) - Revenue per lead (or click)

This amount lets you know how much value each new subscriber has to your business by signing up for your email list or entering your sales process. You can then use this information to estimate how much you should spend to get a new lead (or click), because you now understand the value of the lead to your business.

**6, cost per lead**

On the other hand, cost per lead (CPL). As shown above, if your business doesn't generate a lead, replace "lead" with "click" in your calculations.

CPL is the amount you spend to get a new lead.

To calculate the CPL, divide Facebook's total ad spend by the number of leads generated by ad spending:

Advertising Expenditures , Number of Leads , Expenses per Lead

For example, if you spend $130 to generate 100 leads, your CPL is $1.30:

130÷100 =1.30

If your EPL is 2.70 and the CPL is 1.30, every new lead entering the channel will get 1.40. Given your variable charges, you can determine the number of leads needed to meet revenue and profit targets over a specific period.

When you use Facebook pixel to convert an event, Ads Manager automatically reports this number to you under the "Cost per Lead" bar.

**7, click-through rate**

The metrics discussed above are based on the overall results of your Facebook ads and the effectiveness of your sales process. The way to effectively manipulate and optimize overall ad results and metrics is to develop effective Facebook advertising strategies.

Regardless of your overall sales process, CTR can indicate how attractive your ad copy and creatives are to the audience your Facebook ads target.

Facebook has two different click-through metrics:

· CtR (Link Click-Through) is the number of times a user who viewed an ad clicked a link.

· CTR (All) is the total number of people who interact with your ads. This can be done by liking, commenting, sharing, sliding carousel, or clicking a link.

When running a feed ad, the goal should usually be to increase the click-through rate to more than 1.5%. If the link click-through rate is less than 1.5%, it is recommended that you return and modify your ad copy and creative material.

On the other hand, right-wing ads are usually clicked less frequently than feed ads. The link click rate of the right column ad reaches 0.5% on it.

You may have heard that engagement is an important metric to track. On Facebook, your participation is your CTR( All). This is the total engagement you get from your ad release divided by the total number of appearances:

Participation , Impressions , CTR (All)

Similar to link click-through rates, you want people to interact with your ads because no clicks will result in zero sales.

#### How do I access these Facebook ad metrics in Ads Manager?

When you go to Ads Manager, if you look at the top, you'll see only 2 indicators: Link Clicks and Website Purchases.

So where can you find the remaining indicators?

Find the Columns column: Click Performance. In the drop-down menu, you'll see 13 different report views to choose from.

From delivery and video interaction to positioning and creativity, it takes some time to get familiar with each. However, because metrics are everywhere, you will not use any of these report presets. Instead, create your own custom report view.

To do this, select Customize "Columns" from the drop-down menu shown above.

The open window lists every metric Facebook allows you to track from any ad. You can scroll through everything as needed, but you can find them more easily with Search because you know the exact metrics you need.

In the search bar, start entering your ad RETURN on investment and you'll see the Purchase ROAS metric. Check the box under Total (metric #1).

When Total is selected, Facebook will automatically add this metric to the right column. If you scroll down to the bottom of the list, you'll see options that show the return on ad spend on website purchases and the return on mobile app purchases. We recommend that you uncheck both boxes unless you have a website and an application trying to track the two metrics separately.

Once your ad RETURN on investment has been processed, continue with Purchase. Enter "Purchase" in the search bar and a new option will appear. Next to Purchase, select the Value and Cost check box.

Again, these metrics appear on the right side of the window. Make sure that all check boxes under Purchases Conversion Value are unchecked.

Next your EPL. Unfortunately, because it is a manual calculation, you can't find your EPL in Ads Manager. This is your total revenue divided by the number of leads you get from your Facebook ads (using the formula in indicator 5 above).

But you may want to know how to find the number of sales generated. It's simple, just add lead metrics to your custom reports. Type Leads in the search bar and select the Total check box. Also check the Cost check box next to it to add the CPL (indicator 6).

The last thing you need to do is search for CTR. Check the CTR (All) and CTR (Link Click-Through Rate) check boxes.

Before you save the custom report view as a preset, make sure there are no check boxes in the right column.

Then, in the lower left corner of the window, select Save as Preset, and type a name. Click "Apply" in the lower right corner to apply the changes.

You'll now see all the metrics covered on the screen: return on ad spend, purchase conversion value, cost per purchase, total leads (to determine your EPL), CPL and CTR (link and all interactions) for your posts.

**This article is from WeChat Public No., cover: Instagram ideas**

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