What determines success when it comes to sponsored Facebook ads? Here are three reporting metrics to evaluate.

Metric #1 – Return on Investment (ROI)

ROI is a great metric to have, but it does require a little work. When setting up a campaign, ensure proper tracking is in place so you can visibly see and account for every lead that came through your ad. Then you can tie this audience to revenue activity. If your ROI is 80 percent or higher, this campaign is considered extremely successful and should be repeated. If your ROI was between -50 percent and 80 percent, the campaign may still be considered a success depending on a variety of factors. For example, if this was your first ad to a group of cold leads, getting them to respond is a success even if you did not make back the cost of the campaign. Finally, if your ROI is less than -50 percent, scrap the whole campaign and try something new. Get more aggressive with your offer or try different targeting.

Metric #2 – Frequency

Frequency is a critical metric in your campaign. Knowing how many times your audience sees your ad can determine the success of the ad setup. If your audience sees your ad 10 or more times, the audience is too small or your budget is too big. Seeing the same ad this many times is considered annoying and your relevance score will likely suffer. If your ad appears eight to 10 times, you are borderline successful. Take a moment to reevaluate budget and targeting and adjust accordingly. The sweet spot for frequency is seven to eight times. This is the right frequency for brand recall, but not frequent enough to be annoying.

Metric #3 – Click Through Rate (CTR)

The final metric is CTR–how many people click on your Facebook ad. This metric greatly impacts conversion rates. If 1.5 percent or more click through, your ad is a success. The offer is enticing a large group of people to act. If the CTR is between .5 percent and 1.5 percent, the ad may be a success. This would be a great time to evaluate the offer, targeting and budget to see if a change could take this from the yellow into the green. Finally, if your CTR is less than .5 percent, the campaign should be stopped. Try a new campaign after you have reevaluated the offer, targeting and budget.

Source: DigitalMarketer.com