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Using Ecommerce Insights for Facebook Ad Campaigns

Why advertise on Facebook? There are over 2 billion active monthly users and over 1 billion active daily users on Facebook. With numbers like that, you can't afford not to. However, it's essential you have a clear plan for how to reach your target audience. Having too broad an audience can drain your advertising budget, so you want to narrow down your exposure to only those that might be interested in doing business with you.

Fortunately, Facebook ads can target users by a variety of layers such as demographic, age, gender, or behavior, just to name a few. This level of focus will place your ads in front of the right audience to maximize your return on ad spend (ROAS).


What is ROAS?

Return On Advertising Spending (ROAS) measures the revenue gained for every dollar spent on the corresponding advertising. ROAS measures the effectiveness of online advertising campaigns. You want this metric to be on the high end.

Return on Ad Spend (ROAS) = revenue / ad cost

For example, if you spent $200 on an ad campaign in one month, and during that time the campaign generated $1000 in revenue, your ROAS would be:

5:1 = $1000 / $200

This means that for every dollar you spent on advertising, you generated $5 in revenue.


Getting Started

If you've been following the guide, you've already identified your best customers and best full-price customers. Armed with this knowledge, you can upload your customer lists into your Facebook Ads Manager and create Lookalike Audiences. Lookalike Audiences help you create specific targeting for your ads based on traits from a custom audience (your best customers). Leveraging Facebook's massive user base will help you find people that resemble your ideal customer.


Create a Custom and Lookalike Audience


Note: You'll need at least 100 people in your CSV to create a Lookalike Audience.

You'll first need to create a Custom Audience from your previously exported customer CSVs. We recommend combining them to make the upload easier. If you're unfamiliar with creating a custom audience from a customer file, see Facebook support for more information.

Create Facebook custom audience

Note that you will only need to upload the email addresses. If you want to include more identifiers, which can improve your potential match rate, you can export your full customer list. Make sure to remove anyone not in your Best Customers or Best Full Price Customers report.

Once the list has been uploaded to your Facebook Ads Manager, Facebook will begin to create your audience. This can take a few hours depending on the size of your import. Once the audience is created, it will display as Ready along with the size of the audience.

Newly created custom Facebook audience

Now that you have an audience of your best customers, you can use it as a source to create a Lookalike Audience. If you're unfamiliar with creating a Lookalike Audience, see Facebook support for more information.

Facebook lookalike audience

Note that you can choose the audience size when creating your Lookalike Audience. The size will range from 1% to 10% of the total population in the country you choose, with 1% being those who most resembles your source (best customers).

Audience size

This is important because the smaller the percentage, the more similar the people will be to your best customers. Whereas the larger the percentage, the more potential reach you will have, but the similarity to your best customers will be reduced. Be sure to experiment to find what is right for you.

It can take up to 24 hours for your Lookalike Audience to be created. You can go ahead and create your ad campaign in the meantime.


Create an Ad Campaign

We recommend creating and installing the Facebook pixel before creating your ad campaigns. The Facebook pixel will help you track conversion rates, collect data to help optimize your ads, and much more. See our Tracking Facebook Conversions for more information.

Now that you have the audience you want to target, it's time to create an ad campaign to advertise your best products. Any of the Product Insights reports we've covered so far can yield products to focus your ad spend on. However, there are still reports that can be leveraged.

One set of Customer Insights reports we recommend reviewing are the Customer LTV (Lifetime Value) by Product reports. These reports will help you understand which products drive the highest lifetime loyalty and repeat purchase rates. These products should also be on your ad spend list.

Customer LTV by Product report

When it comes to creating ad campaigns, Facebook offers a variety of options based on your objective. The options range from increasing brand awareness to increasing app installs. In this example, your objective is to track conversions after someone has purchased one of your best products. Select Conversions as your objective and Purchase as the conversion event.

If you're unfamiliar with creating Facebook ads in Ads Manager see, Facebook support for more information.

Creating a good ad can be tricky, so we have provided some tips and best practices to get you started:

  • keep the copy simple and clear, minimize text in your images
  • give your audience a reason to buy, be unique
  • showcase high-quality photos, images should grab the viewers attention
  • create a sense of urgency by including a timeframe or time-sensitive discount

When all is said and done, your campaigns are only as good as the amount of effort you put into them. Continue to measure, optimize, and test. We've only scratched the surface so be sure to visit our Complete Guide to Advertising on Facebook located on our blog.

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