You can grow your business like crazy if you know how to increase your Return-On-Ad-Spend with Facebook Ads.
Why?
Facebook is the biggest social networking platform in the entire world, with a staggering 2.07 billion users. It also has one of the best advertising platforms in the world that boasts one of the strongest targeting options.
The hardest thing with Facebook Advertising is to keep up with the trend and to know what is working. That’s what we’ll talk about.
My experience
What I learned is that it’s not so much about following what other brands are doing. It’s about understanding your customers and creating advertising that makes them buy. I know this sounds cliché, but everyone hears “videos are the best,” “images are the best,” “it’s all about retargeting,” and, I’m sorry to say, but it’s not about that.
Facebook is a tool, videos and images are tools, and the strength really lies in knowing what makes your customer avatar tick—and want to pull out their credit card. If you haven’t yet figured that out, I recommend doing that first or else Facebook will eat up a lot of your money.
Don’t worry, I’ll help. Here are ten strategies you can use to improve your ROAS with Facebook Ads.
1) Use Lookalike Audiences Instead of Cold Targeting
This is a big game changer. Once, we worked with a company that was spending $10k per month (we have a case study here) on Facebook Advertising and they hired us to improve their results.
I looked at their ad account and, without even working on their creatives, we took the highest performing ad (which wasn’t profitable) and started testing 150–200 different lookalike audiences. After two weeks, we made their advertising profitable for the first time in six years!
If you don’t know what lookalikes are, they are audiences created by Facebook based on people who took an action on your ad.
The first thing I look at is if our clients are using lookalikes. It has a huge impact on results, more than you could think.
With Facebook ads, you need to focus on two things: your targeting and your creative. Lookalikes solve the problems you might have in targeting the wrong people.
For example, if 1,000 people purchased your product from your Facebook ad, we could group these people into an audience. We could then ask Facebook to find similar people to the people who purchased your product and decide to target them.
Now, on rare occasions where it isn’t the most profitable audience, the rule is ABT: Always Be Testing with Facebook. But 95% of the time it has ended up being more profitable for us.
Try it out.
2) Target Worldwide
This is huge. I see a lot of people splitting the countries they target, but they have to understand that Facebook ads are about testing, yes, but testing efficiently. On multiple occasions, we end up being surprised to know which countries were the most profitable.
When you find your top-performing countries or even cities, you can create duplicates of your ad to only target those locations. You can trust Facebook to find that for you. It’s way cheaper and most efficient this way (Thank me later).
Now, be careful with South America, Africa, and Asia. They tend to have more fraudulent customers, but they could also be good. From our experience, those countries were never really worth it—but always be testing.
On a side note, it always surprises our clients how much testing we do. Truth is, if you think you are testing enough, you probably aren’t testing enough.
IMPORTANT: if you can’t advertise in other countries because you can only serve those in a certain area, then target the entire area you can cover, no harm done.
3) Test All Placements
I heard so many people telling me to never target the “right-hand side” or only target the “news feed”. To be honest with you, every type of business and advertising is different. Now, there are some placements that “tend” to be better for certain type of businesses, but if everybody is doing the same thing then you are in a red ocean and you better go in the blue ocean fast.
By testing all placements, you let Facebook optimize for you and you can then see which placements are the most profitable for you to keep spending on. Create duplicates and you’re in business (or maybe you already were?).
4) Test All Ages & Genders
If you want to increase your ROAS, you need to test all ages and genders—except if your advertising is clearly geared towards a certain gender or age group.
For example, if you sell bikinis, your average 35-year-old male will probably not be interested (I learned this the hard way).
I know this is contradicting what the common Facebook advertising blogger says. They all try to make you target something “laser-focused,” like having the smallest audience possible.
Listen, Facebook has a really strong AI and ad placement optimization, and trust me: you can leverage it.
By having small audiences, you drastically reduce the possibilities of testing for Facebook AI and thus don’t leverage it as much.
5) Start a Conversion and a PPE Ad at the Same Time
Facebook decides to show your ad to more people if people have had a positive experience with it. By running a Pay-Per-Engagement ad alongside your actual conversion ad, you make more people interact with your ad thus increase your positive feedback score, also called relevancy score.
VERY IMPORTANT: you need take your “post ID” and use it to create your PPE advertising so that the likes, comments, and shares will also go into the version of your ad that is currently being used as a conversion ad.
6) Improve Your “Positive Feedback” Score
Well, I could definitely write an entire article on this topic. Essentially, the better your “positive feedback” score, the more Facebook increases your visibility. This means you’ll pay less to reach more people. It will decrease the cost of your conversions, which will increase your ROAS.
Does that make sense? I made it complicated for no reason. To put it simply: you give more content to Facebook that their users like and they will reward you with more money in your pocket. Isn’t that how business works? Win-win situations.
7) Only Keep the Profitable Ads
That almost seems too stupid to be said, but it isn’t. When you test, you always have this thing going in your head: when should I turn off this ad? Have I spent enough?
When should you turn off your ad? Well, unless you have $5M to spend per month on Facebook ads (call me if you do), there is no point in spending your money on ten different ads if one is more successful.
The question is: are you satisfied with your ROAS? If yes, then you should scale and focus on what’s working. If you want better results and are ready to take the risk then keep testing.
I’m saying risk because if you test new creatives, you will lose more money at the beginning, but if you do it right, you should find something that gives you cheaper conversions fast enough.
The reality is you could also never find something as profitable as your best converting creative and lose $5,000 in testing. Just be smart, okay? I trust you.
8) Create Stronger Retargeting
Retargeting is my area of expertise. I love retargeting and you probably know why. It just gives such amazing results. We usually get eight times better results from retargeting than from cold ads. Now, everyone flatters themselves with their eight-fold returns, but what if I told you they were actually missing out on a big opportunity?
You have to see Facebook as a big machine where you spend money to acquire audiences. Most companies don’t make money targeting cold audiences, meaning audiences that haven’t seen them before. They make money by retargeting those who have engaged with their brands.
Now, the cool part with Facebook is you have so many options to create audiences. You can even retarget the people who have visited your website in the past seven days, 7–14 days, 14–28 days, etc. It’s based on time and action taken, which means this article can’t even begin explaining how deep I went into the subject of creating well crafted retargeting campaigns.
One word of advice, if you are getting 8–9x results, you can do better. Never settle! Okay? Never ever ever ever settle for less than what you can accomplish. I’m kidding, you can sometimes, I won’t judge you.
9) Improve Your Landing Page Design
Again, we’re not going to write another article inside an article (article-ception), but I’ll give you a few pointers as to how you can increase the conversion rate of your landing page.
First thing is to make it beautiful. I know, I know, not the most precise advice, but 99% of websites and landing pages lack design.
My advice: try to have a congruent style that people can follow throughout the website. Second thing: test and track data. Set up Google Analytics and track the changes you made to your website (this is one of my favorite activities—I love knowing what works best).
10) Understand the ABT of Facebook Ads
Facebook Advertising is essentially just a platform that enables you to test your marketing creatives. As you’ll realize, your ability to create good advertising depends on your ability to know what your audience likes and that, my friend, takes time and discipline.
ABT stands for Always Be Testing because tests give you data and that’s the best way to keep improving what you’ve already found. So the more you spend, the better your advertising will be.
If I had $120,000 to spend on Facebook Ads within a year, I would spend $7,000 a month and test consistently, but I would also wait until I find something that gives me satisfying (profitable) results to spend the rest.
I see a lot of commonalities between Facebook Advertising and the stock market. There are times to buy, times to hold, times to sell out. If your results aren’t too great for two to three months, why not stop and change strategy entirely before getting back into it?
A big game with Facebook is managing your budget, which is a topic for another article. To know when to spend and when to not spend is the ultimate philosophical question of Facebook ads.
Final Words on Improving Your ROAS
While increasing your ROAS seems like it’s the ultimate goal of using Facebook Advertising, don’t forget to deliver an amazing experience to your customers.
The cost to acquire a customer will always be bigger than keeping a customer. I’ve heard that too many times, but I’ve also made the mistake too many times.
Focusing on acquisition rather than retention is literally like working all day on meeting new people but not taking care of your close friends. If you’re not making new friends, you have none.
It’s us humans, always wanting more, but the biggest businesses spend 95% of their time on their customers and 5% on acquisition. That is definitely saying something.
Hope this helped, and let us know if you know other ways that weren’t mentioned above that could increase our own ROAS in the future.
