It can be difficult to know whether or not your marketing campaigns are actually bringing in a profit. It is important to know, though, if that last $600 and all those hours you spent on your last Facebook Ads campaign was profitable or a waste of money.
For the long term success of your marketing campaigns, it is crucial to know how to track ROI on Facebook Ads.
Why It’s Important to Track ROI
If you don’t know whether your ads are producing profitable results, you’re taking a shot in the dark. You could be making money or–what seems to more often be the case– you could be losing it rapidly.
About six months ago, I actually heard someone say “there’s no such thing as ROI on Facebook Ads!” Well, technically I saw it on a forum, but I’m still not making it up.
This man, who claimed to have been running successful Facebook Ad campaigns for eight months, was actually arguing the case that there is no such thing as ROIs on Facebook Ads because “you don’t make money on Facebook.”
This is a false statement, all the way around, as I’m sure a lot of you know already. But because I’ve seen similar sentiments echoed in various dark holes across the Internet, I still want to address it.
Anytime you invest money into something (in this case, paying for the ad) and get positive results from it, you’re looking at a return on investment, also known as an ROI.
Not only that, but as we all know, you can make money advertising on Facebook—businesses wouldn’t be spending so much if they just wanted likes and fans to boost their self esteem. I would be curious to know what he defines as a “successful campaign” if he isn’t making any money off of them.
I think this man is a great example of exactly why you need to understand how to track your ROI. He had no idea if he was making money (I’m assuming he wasn’t, since he was saying you couldn’t), and when another member asked how his campaign was successful, he didn’t seem to have an answer other than it had been shown to a lot of people.
Great, your ad was shown to two thousand people, and you paid good money for it.
What does it matter if you don’t know the results? You can keep running an ad that not only isn’t making you money, but isn’t getting you any kind of results, and you would never know.
That’s why it is important to know how to track ROI on Facebook, or any social media campaign.
If you don’t, you can waste a lot of money and time running campaigns that aren’t getting you what you want, and you would never know otherwise.
If you do track your ROI, you can see what works well and what doesn’t, keeping what’s profitable and changing or omitting the areas you are losing money.
Facebook Ads can cost a lot of money. It can definitely be a worthwhile investment (we wouldn’t be here if it wasn’t), but it’s crucial to make sure that money you’re spending is coming back to you in larger quantities or in the form of great results.
It can be tricky to measure ROI on Facebook, because at a first glance, some types of campaigns may not produce obvious monetary, fiscal profit. Running campaigns to get likes on your Page, for example, don’t show immediate monetary profit. But you’re investing that money and time into long term sales, customer service opportunities, and the building of rapport. Overtime, this can and most likely will contribute to profit.
How to Track ROI on Facebook Ads
Fortunately, with the resources available to us, it’s much easier than it used to be to accurately track ROI on Facebook Ads and actually know whether or not we’re running successful, profitable campaigns.
Install Facebook’s Conversion Tracking Pixel
Facebook specifically designed their conversion tracking pixel so that we could—you can guess it from the name—track conversions and ROI generated from Facebook ads.
To create a conversion tracking pixel, you can go into Power Editor and elect “conversion tracking” on the drop down menu.
From there, you can choose what type of actions you want to optimize for and track.
Facebook will then generate a unique code, or offsite pixel, that you can install on your site.
After the code is installed, you can actually create an ad while viewing the pixel, automatically utilizing the conversion tracking in that ad.
Facebook’s conversion tracking pixel follows users from your ad that they clicked on, all the way to the actions they take on your site. This is one of the best ways to know whether your ads are working for sure, instead of just wondering whether the increase of traffic or sales was from the ad or some other factor.
This can give you definitive answers, and if you’re utilizing Facebook Ads for anything other than getting likes on Facebook, you want to install the conversion tracking pixel as soon as possible. To see more about getting the results you want, click here for more information about our ROI-boosting Facebook Ads Formula.
The conversion tracking pixel gives you great insight, allowing you to monitor your campaign’s success easier. It will tell you exactly what conversions were made, helping you evaluate whether or not your campaign was successful.
At the end of the day, you can evaluate the results, listed in an easy-to-decipher way, and see whether you’re getting back what you put into your Facebook ads.
More Tips to Track ROI on Facebook and Monitor Campaign Success
Set Goals for your Campaign
Setting measurable, trackable goals can help let you know whether your campaigns are meeting your own expectations. Sometimes monetary value isn’t necessarily the way to look at it, as a lot of Facebook marketing focuses on soft selling techniques. If you are looking for registration sign-ups, decide how many you want for how much you’re spending per campaign, and evaluate whether that will be worth the monetary value overtime for your business.
Track Your Campaigns Entirely
You need to monitor and keep track of every aspect of your campaign. How much money was spent, how much time was spent (and, if applicable, how much you spent paying someone to run them), how long the campaign ran, what your objective was, what your results were.
You need to track everything.
Facebook offers great analytics on campaigns, but I like to keep track of my individual campaigns in an excel document, where I can look at all of this information in one place. Long term, it’s important to know every factor that could affect each campaign and what the results were.
Only by factoring in every factor will you know whether or not you’re seeing positive ROIs and if your campaigns are on the right track.
As a bonus tip, if you have multiple campaigns across multiple social media platforms, excel documents make a great place to compare these results, too. Facebook vs. Twitter, anyone?
Review and Edit
Review your campaigns and make changes where they are needed, or perhaps try split testing your current ad with a new one. As always, taking what you learn to create more successful and profitable marketing campaigns is key to increasing your ROIs.
At this point, it’s also time to review and edit your ROI goals. If you didn’t reach it, examine whether or not your goal was realistic, and try to determine why you didn’t. If you flew past your goal, consider increasing your own expectations for your next campaign.