While the above benchmarks are helpful, keep in mind that what is a good Facebook ad ROAS for one business could be very different from what is a good Facebook ad ROAS for another business. This can be due to a variety of reasons, such as average profit margins, return rates, and other key variables.
Calculating the average ROAS on advertising campaigns
ROAS is not the definitive marketing metric for determining the success of your paid marketing efforts. However, for this article I will focus solely on ROAS rather than a broader view of total revenue phone number database versus total spend. This is because ROAS continues to be one of the most important metrics for any ecommerce store, and it is the one you have the most control over. Calculating ROAS is simple:
ROAS Calculation = Revenue Generated by Ads / Advertising Spend
Let’s say, for example, that your Facebook ad budget for the month is $10,000. You spend that entire budget and see that the revenue from that spend is $20,000. At the most basic level, this means that your ROAS is 2.0. In other words, for every dollar you spend, you generate $1 in gross revenue. This is the most basic and common way that people calculate return on ad spend.
There are other factors you can (and I would argue should) include to get a more realistic view of your Facebook advertising ROI (for example, factoring in return rates, profit margins, or the halo effect of your total ad spend revenue). But for now, let’s stick with this more common definition of ROAS.
to Increase ROAS and Campaign Performance for Facebook Ads
In general, to increase ROAS and improve campaign performance, you need to increase the numerator (revenue) or decrease the denominator (ad spend)…or both. The strategies in this guide focus on three main approaches to do this:
-
Lowering Cost Per Click (CPC): The first way to improve your ROAS for Facebook ads is to lower the cost per click for each visitor that comes to your site. There are many ways to tips for digital marketing during economic downturns try to lower this cost, but that’s a topic for another day.
-
Increase Conversion Rates: The next way to improve your ROAS for Facebook ads is to increase the percentage of visitors who come to your site through Facebook ads and buy fresh list something. You should monitor your conversion rate data regularly and have clear and reasonable goals for your conversion rates. Facebook makes it easy to track conversions, and if you need help, you can quickly get help from a freelancer.
-
How to Increase Average Order Value (AOV): Finally, you can increase the amount of money each person spends when they buy something.