Facebook Ads

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Chapters:
00:00 How to run Facebook Ads
01:34 How to Make Money Online
07:59 Customer Journey
10:37 Facebook Ads Targeting

Far too often, people are led to believe that Return on Ad Spend (ROAS) is the ultimate indicator of success. However, ROAS is fundamentally flawed. It's a simple ratio – attributed revenue divided by spend – but its simplicity is misleading. The attributed revenue, the numerator, is not reliably tracked nor accurately represented. This lack of reliable data can lead to misguided business decisions. Meanwhile, the ad spend, the denominator, lacks contextual accuracy, making it challenging to assess the true value of advertising efforts. It's crucial to recognize these shortcomings and avoid relying solely on ROAS for measuring success.

Similarly, the concept of New Customer Cost per Acquisition (NCPA) is also flawed. Focusing solely on the cost to acquire a new customer overlooks the vital aspects of customer retention and lifetime value. While attracting new customers is essential, it's equally important to nurture existing customer relationships and encourage repeat purchases. Retaining loyal customers can often be more cost-effective than constantly acquiring new ones. To capture a more comprehensive view of acquisition costs, it's recommended to embrace the Blended Cost Per Acquisition (CPA) metric. This metric considers the cost to secure all transactions, not just those from new customers. By focusing on fostering profitable, long-term customer relationships, businesses can achieve sustainable growth.

Furthermore, it's essential to clarify the role of Media Efficiency Ratio (MER). MER is essentially a high-level ROAS metric that offers little actionable insight. It mainly serves to inflate the ego of marketers rather than provide meaningful information. It's important to recognize that your finance and fulfillment teams, as well as your customers, don't find MER relevant or valuable. To drive genuine, sustainable business growth, it's advisable to shift focus away from MER and instead concentrate on using reliable and meaningful metrics to define success.

The customer journey is vital, as one-time sales hinder growth. Amazon's focus on seamless experiences, in contrast to Facebook's retention approach, fosters loyalty. Customer satisfaction post-purchase outweighs traditional metrics like CPC or CTR. Poor experiences impact retention, increase Facebook CPMs, and reduce ad visibility. Prioritize customer experience for sustained success.

Understanding the customer journey is critical in any industry. Even high-value businesses recognize the importance of multiple transactions. By emulating Amazon's focus on user satisfaction and understanding touchpoints, marketing efforts can be optimized.


Relevant metrics shift to post-purchase sentiment. Unhappy customers raise costs and decrease visibility. Prioritize positive experiences to attribute any failures to the customer journey, not ad management.


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