Audience, Targeting and Bid Strategies
Identifying when to diversify the channel mix and what to look for. Diversification is a big undertaking. When experiencing law of diminishing returns and audience saturation, exhaust all potential audience strategies and bid strategies and continue monitoring key metrics. When scaling, the intention is to reach more people.
Audience Strategies
- Broad campaigns
- Lookalike audiences (1-10%)
- Interest audiences
- Audience stacking
Bidding Strategies
- Cost cap
- Bid cap
Key Metrics Trends
- CPM is increasing
- CPR is increasing
- CTR is decreasing
Facebook ad set inspect tool allows the opportunity explore the relationship between ad spend and cost per result, and first time impression ratio, etc. Another helpful tool is Facebook’s ad frequency tool which helps to recognize the relationship of how frequency is driving costs over time. More frequency tends to increase cost per result. The audience saturation tool establishes the relationship between cost per result and first time impression ratio. First time impression ratio is how many times people are seeing the ad for the first time. 100% first time impression ratio means 100% of the audience is seeing the ad for the first time. As you start to penetrate audiences over time, the first time impression ratio will decrease. Ad platforms have a tendency to show ads to people with a high likelihood to convert at the beginning of the campaign. Over time ads will be shown to people with a lower likelihood to convert. As a result, driving that type of impression volume will increase costs.
Cross Channel Attribution
Find an attribution platform and model that works for you. Setting up cross channel tracking is key. In platform reporting tend to be inaccurate and data may be underreported so rely on a 3rd party objective platform for marketing campaigns and results. Also consider the type of attribution model to give proper credit to the ad platforms that are contributing to the purchase journey. So if using 1 channel, likely use last-click attribution model. If rolling out multiple channels, decide how much credit you want to give credit based on first touchpoint and last click.
Cost vs Conversion Rate
Sale cycle is long for lead generation type offers. In some instances it can take days or weeks to convert. The big challenge is how to track and connect conversion channel to the actual purchase. Set up proper tracking to get valuable insight on how that channel is impacting actual purchases.
Case Study Diversifying Traffic Channels
Facebook CPL: $29
Facebook CR: 3.25%
Google Search CPL: $79
Google Search CR: 15.8%
YouTube CPL: $36
YouTube CR: 4.8%
Performance Max CPL: $21
Performance Max CR: 2.3%
TikTok CPL: $26
TikTok CR: 1.2%
Look at the connection between cost and conversion rate to make informed decisions. If making a decision to stop a channel based on single channel data, there could be downstream ramifications like losing high conversion rate or losing top of the funnel cold audience impressions.