Conversion optimisation is a nice feature in Facebook Ads. It sounds like a dream: Facebook will deliver your ad to users who are more likely to convert. The reality is usually more complicated. Let’s take a look how it works.
Conversion optimisation is connected with 3 campaign objectives:
- Website conversions
- App Engagement
- Product Catalog Sales (Dynamic ads)
But its principle is used even in Website clicks, Lead Ads or App Install campaigns. For the purpose of this article, let’s think about Website conversion campaign. You will use this objective when the goal of your campaign is to deliver specific action on your website. It can be a purchase, contact form submission or view of a key page.
To be able to use conversion optimisation you can use either events from Facebook pixel (be it ViewContent, AddToCart, Purchase or e.g. Lead) or Custom Conversion. In CC you can select any URL of your website as a target page and every view of this URL will be counted as a conversion. Later on, when you’re creating a campaign with Website conversion objective, you will select this event or CC on Ad Set level.
This option will determine to what audience Facebook should deliver your ad. What does it mean? Let’s say we’re creating Ad Set targeting audience of 100,000 users. Facebook’s delivery algorithms want to make sure that only most relevant users from those 100,000 will see your ad. It will try to primarily serve your ad to those users where it expects taking the action you required in Ad Set settings.
To make those algorithms work you need to feed them with good amount of data. It is recommended to use conversion optimisation only if you can have at least 15 conversions per ad set per week. Facebook says the optimal ammount of conversions is 50-100 per week per ad set. And of course, the more the better.
When you selected Purchase as your desired conversion, Facebook will try to use all the signals to find right users in the right place where they will not only click on your ad but also complete the transaction.
As you might know, there are two parts of bidding settings. Optimisation and billing event. We already explained Optimisation event (how FB should optimise the delivery), billing event determines what action you’ll be actually charged for. If you’re using Conversion optimisation, the only billing option is per impressions. This means: Facebook will try to optimise your delivery but you will still pay per each impression of your ad. This bidding type is called oCPM (optimised cost per impression).
You can either enter a manual bid or select automatic one. By selecting auto bid you’re asking Facebook to deliver “as much as conversions possible from selected daily budget“. The engine has the option to bid as it thinks it is the best. When you select let’s say $30 manual bid, you’re saying to Facebook “I want to pay $30 per one conversion” (conversion = action selected in Ad Set detail). FB will use your number and calculate how much it should bid per each impression. This calculation is based on past performance and algorithm’s prediction so it’s important to be realistic. Everybody would like to have conversion for $0.5 but if you’ve been achieving CPA $20 so far, don’t expect that just oCPM bidding will do some magic and drop your CPA by 500%.
You can even select if the bid value is your “maximum” or “average” you are willing to pay. When selecting average you’re basically saying “I don’t mind if some conversions are more expensive but overall, I want to achieve this CPA”. With maximum bid you are limiting each conversion’s CPA to be under your selected value. Using average bid should help you to increase your delivery and capture more conversions comparing to maximum bid option.
Last option to set up is attribution window. You may know that Facebook is using various attribution windows in reporting and the same applies to bidding. When selecting $30 bid per conversion you should say to Facebook which attribution window you want to use for calculating CPA. Of course, it will be different when your preferred attribution window is 1 day after click comparing to 7 days after click. It is highly recommended to use the same window you use for reporting.
How to tackle low delivery of oCPM ad set?
As you already know, oCPM means that Facebook will optimise delivery of your ad set to your most valuable users. It naturally means that the reach won’t be maximum you could get with CPC or CPM bidding. Sometimes, clients even have problems to kick-off oCPM campaign as it is hardly delivering. These are the most common reasons:
1) Low number of conversions
I already mentioned that you should have at least 15 conversions per Ad Set per week (based on the same attribution window as the one selected in ad set settings) to feed FB algorithm with enough data. Facebook stated that 50-100 conversion would be the optimal number to make sure the engine will have enough learning and will be able to deliver your ad with results you want. When you don’t have enough conversions, e.g. purchases, you’ve got 2 options:
- Select another event you will optimise for, e.g. add to cart should have more traffic while it still shows the user’s purchasing intent. This applies as well when your conversion is usually very expensive (e.g. car or property sale) – if you pay more than $1,000 per conversion, use different optimisation event.
- Use another bidding type (probably CPC) to drive traffic to your website and increase no. of conversions, then you’ll be able to use oCPM.
2) Small budget
You want to pay $30 per conversion but your daily budget is $20? How should Facebook deliver such a conversion? And how you want to achieve at least 15 conversions per week? Always use meaningful budget and give enough room to Facebook to learn and optimise. If you don’t want to start with high budgets, you might consider using Seed-strategy.
3) Not enough time, frequent changes
When using oCPM you should be more patient. This bidding type is more suitable for always-on campaigns than few days push promotions. Why? Because the engine needs to learn purchasing behavior of your users and find patterns in it. During first 2-3 days after launching the campaign, it will try to get data and learn how to effectively deliver the ad. If you’re not patient enough, you might kill some campaign which was about to be a star.
Another problem is when you change bid or budget settings to frequently. When FB learns how to deliver your ad with CPA $30 you shouldn’t change it every day as you are in different mood.
I see oCPM as great feature which can help advertisers to improve their real results. But you have to understand how it really works and you need to have enough data for FB algorithm to learn. Then it can work for you. Feel free to share your experience or troubles with oCPM in the comments bellow.
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