Social media advertising is a force in the digital advertising space. Facebook’s social ads accounted for more than $6.8 billion in revenue—and that was just in Q3 of 2016.
Social ads offer an effective way to reach your customers, increase revenue, and track your ROI down to the penny. But before you start running ads, you need to identify key metrics and learn how to track them.
It’s unrealistic to think that one social ad campaign can address a year’s worth of goals for your organization, or help remedy problems in the absence of a solid strategy. That’s why you should begin any ad campaign by mapping your social goals to your business targets.
As our CEO Ryan Holmes has pointed out, it’s best to do a mix of paid and organic content on social and use your organic content as testing grounds for paid campaigns.
Just getting started with social media advertising? Check out our complete guide to social ads.
8 social media ad metrics you should be tracking
1. Cost per action
There are three ways you can pay for your ads: cost per impression (CPM), cost per click (CPC), and cost per action (CPA).
With cost per impression you pay every time your ad is viewed. This can be a costly approach that doesn’t necessarily lead to any type of conversion. Cost per click is commonly used for display ads; your ad can be viewed thousands of times but you only pay unless someone clicks on it. This is useful if you’re driving people to ungated content (content that does not require viewers to enter an email or other info to access the content).
And then there’s cost per action, in which you only pay for selected actions. For example, cost per action on Facebook includes Page likes, offer claims, mobile app installs, and link clicks—and you can select the ones that are the most relevant to your campaign. This is the best approach if you’re aiming to have the audience take an action beyond a click, for example, if you’re trying to get people to download gated content (which requires a form fill), sign up for a webinar, or redeem a code.
There are two big advantages to cost per action. First, you can drill down on and only pay for actions that are aligned with your campaign goals. Second, you can better track leads and new customers by optimizing for conversions like form fills or downloads.
A conversion is defined as a specific action that you’ve identified for your campaign such as a purchase, download, click, sign up, form fill, or a webinar.
By measuring conversions on your social ad, you can better understand the ROI of your campaign. That’s because what you’re tracking is closely linked to an action that is relevant to your goal. If your goal is webinar sign ups, that’s what you should pay for (and track), not just the number of impressions or clicks on an ad. By creating CPA ads, you’re better set up to track conversions.
How to track conversions:
If your ad is driving people to your website, a landing page, or content, you should be using UTM parameters in all your links for ads. UTM parameters will allow you to track actions, purchases, and goal completions for every piece of content that you post.
Using Google’s URL Builder, you can create UTM parameters for the links in your ads. Make sure you fill in the following:
Source: Social network the ad is on
Medium: Type of content you’re sharing
Campaign: Name of campaign or campaign keyword
Remember, you need to have Google Analytics on your website to track conversions. Check out our guide to tracking social in Google Analytics to get set up.
3. Click-through rate
If you’re running cost per click ads, you should track the ratio of people who have seen the ad versus the number of people that took action by clicking. Click-through rate (CTR) is determined by taking the number of clicks and dividing by impressions. So, for example, if you had three clicks and 1,000 impressions, your CTR would be 0.3 percent.
In addition to understanding the success of a given social ad, a better CTR will improve your quality scores and can lower your costs. The better the performance of your ad, the lower the cost.
Knowing how your social ad contribute to your overall traffic to your destination, such as your website, is important. Spikes in activity can show you how engaging your campaign was, how many unique/new visits you had, and what your conversion ratios look like. To get a better understanding of what your traffic means, you should look at it in the context of conversions, traffic sources, and leads.
How to track social traffic:
When you log into Google Analytics, there’s a general overview of your website traffic in the main dashboard. In order to monitor traffic during your actual campaign period, adjust the dates accordingly. If you’re running an annual campaign, it’s a good idea to do a year-over-year comparison of your previous campaign period.
5. Traffic sources
If you get tons of website traffic during your campaign period, that’s great. But if you don’t know where the traffic came from, then you’re going to struggle to show exactly how social contributed. You’ll also want to know which ads performed well and why, so you can replicate successful formulas. For example, if you’re running an ad campaign on Twitter, Facebook, and Instagram, and you’re driving people to the same content, then you want to know which network and ad sent people to the site.
How to track your traffic sources:
If you’re running ads across multiple channels (or running different ads across the same network), you should use UTM parameters on your URLs. This will help you track visitor numbers and identify which ads were successful.
As mentioned earlier, Google’s Campaign URL Builder will allow you to add a unique URL so that you can track your campaigns in Google Analytics. To track traffic coming from custom links, go to your Traffic Sources report in Google Analytics and click on Traffic Sources in the left menu.
6. Mobile traffic
A good chunk of people that engage with your content come from a mobile device. It’s important to know what traffic is coming from mobile devices, what their behavior is, and what social ads resonate best. That way, you can plan your social campaigns to make sure that you’re targeting the right people on the right devices. You can understand things like mobile visits, pageviews, bounce rate, traffic by source, and mobile keywords.
How to track mobile traffic:
You can create a mobile dashboard in Google Analytics. This will allow you to view things like mobile traffic, bounce rate, visit duration, and organic keywords. To view your mobile traffic, navigate to Audience, select Mobile, and choose Overview. Then, select a date range and select the data you’d like to compare.
7. Cost to acquire a lead
In order to report on the return on investment of any given social ad campaign, you need to calculate the cost to acquire a lead (CAL). To determine CAL, simply divide your ad spend by the number of leads generated during the campaign period. Your most successful campaigns will acquire high quality leads at the lowest cost.
How to track leads:
A simple way to track leads for a social campaign is to use your social ad to drive people to content that requires a form fill or run events that require sign ups. If you’re sending people to your website or landing page, make sure you use UTM parameters so that you can identify if leads have come from your campaign.
If you’re wondering how your social ads impact ‘offline leads’ like store visits, Facebook has introduced new measurement tools that will allow businesses with brick and mortar locations to see how many people visited the store after they saw a Facebook campaign ad.
8. Customer conversion ratio
If you want to go one step beyond tracking leads, you can track the number of leads from your social ads that convert into customers. This will extend beyond the social ads themselves, and will help you identify where your customers are dropping off and/or where they’re converting.
How to track conversion ratio:
By creating and implementing a Facebook Pixel to your website, you can track conversions without changing any of your website’s code. Facebook’s Pixel guide will give you all the steps to get started, and will allow you to define conversions.
Google Analytics will also let you add conversion tracking tags to your campaigns to monitor what people do after they click on your ad. If you set up and define goals in Google Analytics for your website, you can measure how often people complete specific actions.
Track your social ad performance
By setting clear goals and knowing which metrics are important to your campaign, you’ll have a better grasp on what went well and how you can improve. You’ll also have more concrete data to prove the ROI of social for your business.
Manage, optimize, and track the performance of your social ads across multiple networks using Hootsuite. Ads options are available for Facebook, Instagram, Twitter, and Pinterest. Learn more and create your ad today.