Marketing leaders and business owners are experiencing this scenario more frequently. In Ecommerce, Meta Ads have risen to be the superstars of marketing but lately the cost may not justify the return?

What you will learn in this article

This article will serve as a backstage pass into the world of Meta/Facebook Ads, equipping you, the Ecommerce marketing leader or business owner, with the knowledge to determine if Meta Ads are the best fit for your marketing mix.  Below are 8 pitfalls, to assess if you have the resources to drive business impacting results from Meta Ads.  

A word from our Sponsor - Subkit

Here are the 8 Reasons to not invest in Facebook/Instagram Ads

1. You have not created a financial model/forecast that includes GTM activities.

The success of your Ad campaigns should be rooted in a financial forecast that's mapped to your GTM activities.  If you do not have that clearly articulated, it will be difficult to set goals for an ad campaign. Setting goals is the cornerstone of a successful Meta Ads campaign. Clear objectives guide your strategies, dictate your ad content, and provide a measure for your campaign's success. Let's delve into the most important aspects of this crucial process.

Firstly, identify your objective: Do you want to increase brand awareness, drive traffic to your site, generate leads, or boost online sales? Meta Ads Manager provides you with specific objectives that align with your business goals.

Secondly, align with your marketing funnel: Your objectives should match the stage of the customer journey you're targeting. Top-funnel goals could be about awareness, middle-funnel about consideration, and bottom-funnel about conversions.

Third, define your metrics: Once you have your objectives, identify the metrics to track these goals. These could include Click-Through Rate (CTR), Conversion Rate, or Return on Ad Spend (ROAS).

And Fourth, benchmark and adjust: Set realistic targets based on past performance or industry standards. As you progress, don't hesitate to adjust your goals as needed.

Best Practices

• Choose objectives related to Awareness (Reach), Consideration (Traffic, Email Engagement, App Installs, Messages) or Conversion (Conversions, Catalog Sales, Store Traffic).
• Choose the right objective that aligns with your overall business goal. If you want more website traffic, choose traffic objective. For sales, the conversions objective.
• You cannot change the campaign objective once the campaign is running. However, you can always create a new campaign with a different objective.
• Use industry benchmarks for metrics like CTR. A good CTR can vary widely based on the industry, audience, and type of ad, but as a rule of thumb, a CTR of 1% or above.
• Measure ROAS. ROAS stands for Return on Ad Spend. ROAS helps online businesses understand which ads are working and how they can improve future advertising efforts.

2.  Your team has not allocated resources towards optimizing targeting and personalization.

"It's about to get real for online advertising. iOS changes have already impacted attribution and targeting in Facebook ads.   Google is announcing a total phase out of third party cookies.  Google will phase those out by middle of 2024.  The only channels will be channels that you own -- community, email, website, and partnerships"

- CT Taylor, VP.Growth, Subkit

The key to a successful Meta Ads campaign lies in effectively targeting your audience and personalizing your ads to resonate with them. Here are the most critical aspects you'll need to hit when working on your target audience and personalization strategy.

Demographic Targeting: This is your first line of segmentation. You can tailor your ads based on the age, gender, location, and language of your audience. It’s a basic but crucial step in reaching the right people.

Behavioral and Interest Targeting: Meta provides data about users' behaviors, interests, and connections. Understanding these can help you target facebook users or a facebook group of users who are likely to be interested in your products or services.

Custom Audiences: You can target people who have interacted with your business, either on your website, app, or even offline. These are known as custom audiences, and they can help you reach people who already have a connection with your brand.

Lookalike Audiences: Meta allows you to target people who are similar to your current customers, known as Lookalike audiences. These people are likely to be interested in your business because they're similar to your best existing customers.

Personalization: Once you've identified your target audiences, personalize your ads to make them more relevant. This could mean creating different ad sets for different audience segments, or dynamically changing ad content based on user data.

Best Practices

• Develop a custom audience made up of your existing customers or leads. Create a custom audience via list of email addresses, phone numbers, or by using Meta Pixel data from your website or app.
• Create Lookalike audiences based on the people who like your page, have visited your website, or are part of a custom audience you've created.
• Personalize your ads in various ways, like changing the ad copy or image to match the audience segment you're targeting. Show different products to different audience segments, or adjust your messaging based on the user's stage in the buying cycle.
• Use interest targeting to reach people who have shown interest in subjects related to your competitors. For instance, if you sell athletic shoes, you could target people who have expressed an interest in running, sports, or specific athletic events.

Understanding your audience and tailoring your ads to their needs, you can achieve higher engagement and conversions with your Meta Ads. It's all about delivering the right message, to the right people, at the right time.

3. You do not have dedicated resources for ad campaign creatives. 

Data provided by Emplifi eCommerce Report

Creative optimization is vital for your Meta Ads success. The design, messaging, and overall presentation of your ad or ad set can make or break its performance. Here are the most critical needs when optimizing your ad creatives:

Your ad message should be concise, clear, and communicate your value proposition effectively with simple font. Eye-catching visual can drastically improve your ad's click-through rate. Make sure your visuals are high-quality and relevant. Strong CTAs prompts the audience to take the desired action. Make it clear what you want the viewer to do next. Always test different versions of your ads to see what works best. This could be changing the image, tweaking the headline, or trying a different CTA. Use the results to refine your ads and improve their performance over time.

Best Practices

• Focus on your value proposition, keeping it concise, using simple language, and making it about the customer and their needs. 
• Make sure messaging aligns with your brand voice and communicates what makes your product or service unique.
• Experiment with different formats, such as static images, videos, or carousels, to see what resonates with your audience.
• Create a strong CTA that's action-oriented and creates a clear sense of urgency. 
• Aim for a high relevance score because it increases your ad's chances of being shown over those of your competitors and lower your costs.
• Test different elements of your ad, such as the headline, ad text, CTA, image or video, and the overall design. 
• Use A/B testing to compare different versions and see what works best.

Remember, the best ad creative is one that resonates with your audience. By focusing on these key aspects, you can create more effective Meta Ads that drive results.

4. You have not assessed if your Facebook Page is already driving great return. 

Why pay for ads if your facebook ad can accomplish most of your goals? 

Your facebook page may already drive enough return.  For example, your page may drive enough brand awareness to where investing in paid ads will not give you enough lift to justify the cost.  Understanding the strengths and utility of Facebook pages versus paid ads is critical to formulating a comprehensive strategy. While both have their unique advantages, they serve different purposes in the broader framework of online marketing. Key Considerations:

Facebook Pages: A Facebook page is a public profile created for businesses, brands, celebrities, causes, and other organizations. It is a direct medium of communication between the brand and its customers. Brands use Facebook pages to share updates, post photos or videos, link to new blog posts, or announce new products or promotions. Here are a few factors to consider:

• Long-term Relationship Building: Facebook pages are essential for long-term brand building and cultivating relationships with customers. They allow for two-way communication and engagement.

• Organic Reach: Over the years, the organic reach of Facebook pages has declined. It's increasingly difficult to reach your followers without paid promotion.

• No Direct Cost: Running a Facebook page does not entail a direct cost unless you choose to boost your posts or run ads.

• Paid Ads: Facebook ads are paid messages from businesses that aim to reach a specific audience with specific outcomes in mind. Here are some important factors to consider:

• Targeting: Facebook ads offer granular targeting options, allowing brands to reach specific audiences based on demographics, interests, and behavior.

• Quick Results: Paid ads can drive immediate results, such as website clicks, lead generation, or online sales.

• Cost: Facebook ads require an advertising budget. The cost varies based on factors like audience targeting, competition, and the objective of the campaign.

Facebook Page Example: A local bakery uses its Facebook page to share photos of their daily offerings, promote special events, and respond to customer inquiries or feedback. They build a community around their brand, but to increase their reach, they must either consistently engage with their audience or use paid promotion.

Paid Ads Example: An online clothing store launches a new collection. They use Facebook ads to reach a specific audience - women aged 18-35 who are interested in fashion. The ad leads users to the new collection on their website, driving immediate sales.

Best Practices

For Facebook Pages, monitor:

• Engagement Metrics: Likes, shares, comments, and page follows.
• Reach: The number of unique users who see your posts.
• Page Views: The number of times your page was viewed.

For Facebook Ads, keep track of how your business performs against benchmarks [link to Facebook conversion article]:

• Performance Metrics: Impressions, reach, and click-through rate (CTR).
• Conversion Metrics: Actions taken on your website as a result of the ad (purchases, sign-ups, etc.)
• Cost Metrics: Cost per click (CPC), cost per action (CPA), and return on ad spend (ROAS).

Source: Emplifi eCommerce Report

Both Facebook pages and paid ads are important components of a successful strategy. The former helps maintain customer relationships and foster brand loyalty, while the latter helps reach new audiences and drive immediate results. Which is best?

The key lies in where your business needs help the most -- revenue retention or new revenue.  Note it is usually more cost effective to retain a customer than acquire a new customer.  So if you have lower acquisition cost in another marketing channel, use that channel to acquire new customers and Facebook pages to retain them. 

5. You are not tracking conversions in your other marketing channels. 

It's important to know conversions in your marketing channels.  This will give you the ability to compare the conversions of your connected landing page to other channels. Also, allows you to see if paid marketing has had a positive impact on your other marketing channels. 

As the bridge between your Meta Ads and your website, landing pages play a crucial role in converting clicks into customers. Key elements of an effective landing page:

Consistent User Experience: A seamless transition from ad to landing page that matches the ad's promise. 

Focus Call-to-Action: A landing page focused on one specific action you want visitors to take. This lack of distractions can dramatically improve conversion rates.

Tailor Messaging: Align a specific audience and offer. This can enhance relevance, engagement, and conversions.

Tracking & Optimization: With a dedicated landing page, you can easily track visitors from specific ads, understand their behavior, and optimize your page and ads based on insights.

Social proof: Reviews, testimonials, or case studies can enhance credibility and convince visitors to take action.

Use analytics tools to track key metrics such as the number of visitors, conversion rate, time spent on the page, and more. This data can help you understand how well your landing page is working and where you might need to make improvements.

Best Practices
While you can, it's generally best to create unique landing pages for each ad or ad group. This allows you to tailor the landing page to the specific audience and offer of each ad, increasing relevance and conversions. Landing pages are an essential component of successful Meta Ads. By creating a seamless, focused, and engaging user experience, landing pages can significantly enhance the effectiveness of your ads and the profitability of your campaigns.

6. Are you able to determine if Meta Ads will have a positive impact on existing brand awareness metrics? 

"When you are creating demand, you aren’t marketing for conversion. You’re marketing for education & affinity. You're building a brand. So when those ICP buyers (that aren’t in buy mode right now) actually move into a buying cycle in the future, they have affinity to your company, your product, your category, and your narrative. And when they're ready to buy, they go search for YOUR BRAND."

-Chris Walker, CEO-Refine Labs 

Facebook's advertising platform, Meta, provides a unique opportunity to reach a vast audience and significantly enhance brand awareness. However, determining the effectiveness of these campaigns necessitates a keen understanding of critical metrics and factors. You should measure your brand awareness through tools like Mention.com, Brandwatch.com, etc. Here's a comprehensive overview of what you need to consider when assessing the impact of Facebook on brand awareness. Key factors to consider:

1. Reach: Reach refers to the total number of unique users who have seen your ad or post. It provides a raw estimate of the size of your audience. However, reach alone doesn’t indicate how well you're raising brand awareness. It must be analyzed in conjunction with other factors like engagement.

2. Engagement: Engagement measures the interactions on your posts or ads - likes, comments, shares, or clicks. High engagement rates often signal that your content resonates with your audience, thereby enhancing brand awareness.

3. Frequency: Frequency shows how often a user sees your ad. A higher frequency can increase brand recall, but excessive repetition might lead to ad fatigue.

4. Ad Recall Lift: This unique Facebook metric predicts the number of users who remember seeing your ad within two days. It’s a direct indicator of brand awareness.

Best Practices

Constant monitoring and evaluation of these factors ensure your brand awareness campaign is on track. Use A/B testing with different creative elements, messages, and audience segments to identify what works best for your brand.

1. Ad Recall Lift Rate: Suppose your campaign generated an ad recall lift of 10,000. This means an estimated 10,000 people would remember seeing your ad if asked within 48 hours.

2. Engagement Rates: If your organic post reaches 1,000 people and receives 100 engagements (likes, comments, shares), your engagement rate is 10%. A high engagement rate suggests strong brand relevance and awareness.

3. Reach and Frequency: A campaign that reaches 20,000 unique users with an average frequency of 3 indicates your ad was displayed approximately 60,000 times. But remember, balance is key. Over saturating users can lead to negative perceptions.

Consider the case of fashion retailer ZARA. They regularly use Facebook carousel ads showcasing multiple product styles. This strategy has increased their brand awareness by reaching millions of users, coupled with high engagement rates reflecting the interest of their target audience.

Facebook can significantly impact brand awareness. However, it’s crucial to keep track of relevant metrics and adapt your strategy based on data-driven insights.

7. You have not attributed the financial impact of each Ad Set and Campaign. 

Understanding the financial effectiveness of ad sets and campaigns is crucial. The comprehensive analytics provided by Facebook Ad Manager can be valuable if you have a clear understanding of what to track and why.  You can gain invaluable insights into your advertising performance. Here's what to focus on. Key factors and metrics to track: 

• Click-Through Rate (CTR): CTR measures the percentage of users who clicked on your ad after viewing it. A high CTR typically indicates that your ad is resonating with your target audience.
• Conversion Rate: Conversions occur when a user completes a desired action, like making a purchase or filling out a form. A high conversion rate is a strong indicator that your ad effectively encourages users to take action.
• Return on Ad Spend (ROAS): This is the amount of revenue generated for every dollar spent on advertising. ROAS provides a clear picture of the profitability of your campaign.
• Cost per Action (CPA): CPA measures the average cost of a single conversion. This key metric allows you to understand the financial feasibility of your campaign.
• Frequency: Frequency tells you how often a user sees your ad. Overexposure can lead to ad fatigue, decreasing engagement and increasing costs.

Understanding the key factors and metrics to evaluate the effectiveness of your ad sets and campaigns will help you refine your strategy and ensure your advertising spend yields maximum returns.

8. Your ad types are not diversified

"Ecommerce tip to pump thousands worth of sales revenue in single day -- test multiple products in ads and give your customers options alloing them to choose the best product that fits their needs"

- Ruslan Galba, CEO-Tegra

Facebook's advertising platform, Meta, offers a range of ad formats to cater to various business needs. As of now, the platform comprises six main types of ads: Image ads, Video ads, Carousel ads, Slideshow ads, Collection ads, and Instant Experiences.

Image Ads are the simplest and most common type, known for their ease of creation and ability to tell a story through a single image. According to a study by SocialBakers, image ads account for about 27% of ad spend.

Video Ads can appear in the news feed and stories or as in-stream ads in longer Facebook videos. Given that 54% of consumers want to see more video content from businesses they support, it's no surprise that video ads make up around 14% of ad spend.

Carousel Ads enable brands to showcase up to 10 images or videos within a single ad, each with its own link. These ads drive a 30-50% lower cost-per-conversion and 20-30% lower cost-per-click than single-image ads.

Slideshow Ads offer an easy way to create short video ads from a collection of still photos, text, or existing video clips.

Collection Ads allow businesses to showcase a variety of products and lead the audience directly to a mobile shopping experience.

Instant Experiences are fullscreen experiences that open after someone interacts with your ad on a mobile device.

Best Practices

• Understand your audience: Knowing who your target audience is allows you to create ads that resonate with them.
• Choose the right ad type: Depending on your campaign objective and audience, select the ad format that will perform the best.
• Create compelling visuals: High-quality and relevant images or videos can grab attention and boost engagement.
• Craft a strong headline and description: Your headline should be catchy and your description should clearly convey your offer's value.
• Include a clear call-to-action (CTA): A CTA guides your audience on what to do next.

In conclusion, several reports and suggests a general trend of increasing costs and decreasing organic reach in Facebook advertising. This is due to various factors such as increased competition in the advertising space, changes in Facebook's algorithm to prioritize content from friends and family over businesses, privacy changes, and ad fatigue among users. As a result, many businesses are finding that they have to spend more on Facebook ads to achieve the same results, leading to diminishing returns.