Facebook has rolled out an advertising conversion measurement and optimisation system, allowing SMEs to measure the effectiveness of their ads on the social media platform.
According to Facebook, the new system allows advertisers to measure the ROI of their advertisements by counting relevant user actions that are driven by people seeing advertisements on Facebook.
“Relevant user actions” include registrations and shopping cart checkouts.
Marketers can now also use optimised CPM (cost per mille/impression) to deliver advertisements to people who are most likely to convert on their websites.
Optimised CPM allows an advertiser to prioritise their marketing goals, and then automatically delivers advertisements against those goals in the most effective way possible.
“Beta tests have shows that when conversion measurement is used with optimised CPM, ads reduced the cost per conversion by 40% when compared to CPC [cost per click] ads using the same budget,” Facebook wrote in a blog.
“This means that marketers who are interested in using Facebook ads and sponsored stories to drive specific actions on their websites can now use conversion measurement both to understand the ROI of their ad spend and to improve that ROI on future campaigns.”
Facebook said this should be “extremely valuable” for marketers in eCommerce, retail, travel, financial services and other direct-response industries that value actions taken on their websites.
Early testing of conversion measurement with optimised CPM has generated “strong results” for multiple advertisers, the company said, including online retailer Fab.com.
According to Facebook, Fab.com was able to reduce its cost per new customer acquisition by 39% when it used conversion measurement and optimisation to serve advertisements to consumers deemed most likely to convert.
Conversion measurement and optimisation can be used on all Facebook advertisements and sponsored stories, and in combination with any targeting abilities.
Facebook conversion measurement is also the only solution that can report when a user views an advertisement on one device, such as a mobile phone, but converts on another, such as a desktop computer. This is useful for cross-platform advertising campaigns.