Tag Archive for: facebook ads

A person budget planning for digital ad spend

How We Decreased Pathstream’s CAC by 59% YoY

tuff-2022-growth-marketing-agency-landing-case-study-1

When we first started working with Pathstream – a Series A startup that offers online certification programs that help people level up their careers, they were spending nearly $1m each quarter in ad spend to hit their lead volume goals, but with a ROAS right around 1.10. They were hitting their application targets, but they were breaking even doing it. 

By restructuring ad accounts, testing creative, audience targeting, and different conversion events, we were able to help decrease Pathstream’s CAC by 59%, leading to their most efficient quarter ever and hitting their ideal LTV to CAC ratio for the first time. 

For 80% of our partners, we take a blended approach to reducing CAC – we focus on decreasing costs on ad channels to send more traffic to the site with the same amount of money, and we create a CRO strategy to improve website conversion rates. 

The exception? When development capabilities are limited or a partner has a custom CMS. That was the case for Pathstream. We weren’t able to implement robust CRO tests in order to improve CAC – we had to get creative when it came to optimizing Facebook and paid search campaigns on Google to hit those CAC targets.

Facebook

When we first partnered with Pathstream, a majority of their ad spend was dedicated to Facebook ads, but the cost per lead, cost per application and cost per enrollment were extremely high and they knew they needed to drive these costs down in order to keep investing a large majority of their paid spend into Facebook. 

With this goal in mind, our social ads team immediately started diving into the Pathstream ad accounts and analyzing the existing data to identify opportunities or “quick wins” as we call them, while also simultaneously working on a longer term strategy for driving down Facebook costs. 

Here’s a sneak peak of how we drove down their Facebook CPL by 63% year over year. 

Testing new audiences 

We tested a handful of new audiences over the past year for Pathstream from job titles, to interests, demographics and lookalikes. We found that our most successful audiences were based on interests for specific Pathstream programs (Asana, Salesforce, Digital Marketing, Data Analytics) and a lookalike of 5% based off of previous Pathstream students who have enrolled in one of their certification programs. 

Since some of the program interests we were targeting could possibly have overlap (Example: Digital Marketing and Data Analytics), we used the audience overlap tool to ensure that the overlap wasn’t greater than 40% so that our program specific audiences wouldn’t be bidding against each other.

testing audiences on Facebook

After we discovered that these were our top performing audiences, we tested a combination audience that targeted both the interest audience and the lookalike in one ad set. This ultimately did not perform as well as the two audiences segmented out into their own ad set. Based on this learning, we segmented each audience back into its own ad set and set the budget at the campaign level which allowed Facebook to allocate the daily budget to the audience with the lower cost. 

Optimizing for Higher Funnel Conversion Events

When we first launched campaigns, we were extremely focused on driving down the cost per enrollment, so all of our campaigns were optimized toward the “purchase” conversion event. We soon realized that most Pathstream students don’t immediately enroll in a program when they first find out about Pathstream. In fact, it could take weeks or even a month for someone to enroll in a Pathstream program after first expressing interest. 

This led us to switch up our optimization strategy and test out a higher funnel conversion event (submit application), which fires once someone enters their information, becomes a lead and also completes a quick application. 

By switching to a higher funnel conversion event, we were not only able to increase the total number of applicants, but we were able to drive down the cost per impression, cost per click, cost per lead and cost per enrollment by bidding on a higher funnel action –– which is less expensive and in return gives the Facebook algorithm more data to target users likely to submit an application. 

Developing new conversion-driven creative

A large part of our Facebook strategy we put together in our initial research for Pathstream included new create asset ideas based on a creative analysis we pulled together with what’s working well and what’s not resonating as well with the Pathsream audience. 

💡We create data-driven ad creative at Tuff, and have an entire blog post about how we approach that for our partners. Check it out here!

We wanted to test a mix of image and video assets that showcased Pathstream’s value props in an engaging way that would get our audience to click on the ad. We tested a combination of school-branded assets and pathstream branded assets and found that all of the assets that mentioned “100% online” and “get a project management/digital marketing/salesforce certificate” in 6 months were our top performing static ads. 

We also tested UGC style videos (like this one) and saw a 56% increase in CTR and decreased the cost per lead by 37% once we rotated those into our campaigns. 

testing creative on Facebook

Paid Search

With an ad account this large, we ended up restructuring campaigns twice since we started partnering with Pathstream.

Phase 1 Account Restructure

Initially, Pathstream had over 30 different Google Ad accounts they were running campaigns from. Pathstream partners with different universities to offer their certification programs covering curriculum on Facebook Digital Marketing, Salesforce, Tableau Data Analytics, and Asana Project Management. They had a separate ad account for almost every university + certification program combination. 

Our first step was combining the campaigns across 30 ad accounts into one to increase the amount of lead data in one ad account to make the Google algorithm work smarter for us.

Even though we culled down campaign structure significantly in phase 1 of our account restructure, we still had over 40 different search campaigns, each with minor differences. 

There’s nothing inherently wrong with this approach. Many partners have similar account structures and are certainly successful, and Pathstream was finding success early on with this approach as well. With the goal of getting CAC even lower though, we set out to restructure things again after a few months. 

Phase 2 Account Restructure

At this point, we were utilizing many automated, conversion focused aspects of Google Ads. Max Conversions bidding strategy, Data Driven Attribution, Dynamic Search Ads. With these campaign features, Google works best when there is an abundance of data, specifically conversion data flowing into each campaign. 

If campaigns are too spread out, only receiving a few conversions per month, you may be underutilizing the true power of automation. This was partially the case for Pathstream.

By condensing campaigns from 40+ to 15, we allowed more conversion data to feed into fewer campaigns, in turn making our ads more efficient. We did not limit targeting. This was not designed to decrease our volume or impression share at all. We were not looking to lighten our workload either. Instead, limiting the number of campaigns gave Google more conversion signals, gave Tuff more opportunity to experiment and learn quickly,  and also allowed for better informed expansion across channels in the future.

For starters we left our highest performing campaigns alone. The ones bringing in the most conversion volume and most search volume remained mainly untouched. The big changes were with the campaigns that had the least amount of monthly search volume. Many of them we grouped together into a catch all campaign. What was 10 separate campaigns all converting only a few times a month became one larger structure that converted much more often as a whole. 

Only 3 weeks after our account restructure we saw these results:

  • Conversion Rate increased 26%
  • Cost Per Lead decreased 38%
  • CPC dropped 21%
  • CTR increased 8%

This was only the beginning. Performance continues to improve week over week while we gather more data in a much less congested structure. From here, we can start to expand our reach by efficiently pivoting what is working best for us in the short term and beyond. 

Have a complicated Google ad account structure you could use a second set of eyes on? Or need help reducing your costs on Facebook? We’d love to help!

Why Should I Use Nextdoor Advertising?

2022 has brought a lot of surprises to the macro environment for both marketers and consumers. A new favorite game we’ve started playing across the social ads team at Tuff is “which prices increased more this week” – gas prices at our local gas station, or CPMs for our Facebook campaigns. For some of our partners, CPMs for Facebook campaigns have risen by 30%+ in the last 60 days, with no sign of slowing down as advertisers fight to get in front of their target audiences. 

If you’re one of the countless businesses or agencies across the world (and the metaverse), you’ve likely noticed that your reliable paid acquisition channels look a little less reliable these days. You may be wanting to see if your spend can go a little bit further on another channel. So, you ask yourself, “Why not try a new channel? I’ve heard about Nextdoor advertising. What about testing that out”?

Well, you’ve come to the right place. 

Why Use Nextdoor?

Is Nextdoor effective? Does Nextdoor advertising work? How much does Nextdoor advertising cost? As you might’ve guessed, the answer is, “it depends.” As a growth marketing agency, we work with all types of partners with a variety of needs. Many of them use Nextdoor with great success, for some, it doesn’t make sense as part of their marketing mix. 

The first of many considerations you have to make when you’re thinking about using Nextdoor is “Why?”. Maybe Simon Sinek was onto something when he said to start with “why”. The first real question you should ask yourself when considering Nextdoor isn’t “should I?”. It’s “Why should I?”.

There are a few reasons why you would consider using Nextdoor: 

  • Your target audience is there
  • Your competitors use Nextdoor advertising
  • You need to differentiate spend away from rising costs on your Facebook Ads

Regardless of your reason, there’s a why, and you should unearth that before you move on to the next step.

Can I Reach My Audience Using Nextdoor Advertising?

According to Nextdoor there are nearly 1 in 3 U.S. households already on Nextdoor. These neighbors are motivated to support local businesses.

More than that, 88% of Nextdoor users frequent a local business at least once a week and they make 90% of their purchases within 15 miles of their work or home. Nextdoor neighbors love to spread the word.

If you’re a business with a local storefront or local events, then this should be appealing to you. Understanding that every social platform has slightly different behavior, you can leverage Nextdoor’s ability to generate local behavior in a way that you can’t with Facebook or TikTok.

What Targeting Options Exist on Nextdoor Advertising? 

By default, Nextdoor will deliver your ads to all audiences within your selected locations. You can uncheck this default setting though and get access to more demographic targeting options

Overview of Nextdoor Targeting Options

As of the time of this article, Nextdoor does not have targeting that is as robust as some of the other demographic targeting platforms such as Facebook, but it does give you some pretty interesting homeownership and interest targeting options that you can leverage. 

Are Nextdoor Ads Expensive?

Nextdoor ads are comparable in cost to other paid social channels. Nextdoor works on an auction system so you’re bidding on placements in the platform based on the targeting parameters you’ve set. The platform offers you the ability to bid on a CPC basis or a CPM basis. 

The option you choose will influence how you’re charged and it will affect your costs. It is possible to run Nextdoor with relatively small budgets, but as with most platforms, it performs better given more budget to work with.

Overview of Nextdoor's Bidding Options

What Creative Placements Are Available on Nextdoor?

Nextdoor has 3 placements for you to use in their self serve ad platform: Newsfeed, Finds, and Right Rail. We have found that most advertisers opt to only use the Newsfeed placement since that is the most effective use of spend on Nextdoor. However, depending on your objective, the Finds placement and Right Rail placement could also be good for brand awareness initiatives. 

Should I Use Nextdoor Advertising? 

Nextdoor as an ad platform has a few limitations, and it’s not for everyone. It isn’t the next Facebook (Meta), TikTok or Snapchat. And it’s not trying to be. 

Nextdoor is incredibly effective for local businesses, local events, and getting the community involved. So if you have a business that has a strong localization component or wants to be seen in the community more, then absolutely give Nextdoor a try.

Want to take a new approach to paid social channel diversification, but are unsure of where to start? Let’s talk about how Tuff can help you make the most use of your paid social advertising spend with a multi-channel approach.

Browing social media

The Do’s and Don’ts of Broad Prospecting

Browing social media

In the new landscape of paid social advertising, most customer success representatives and account managers (whether they are at Meta, TikTok, or Snapchat) are pushing broad prospecting as the new “meta” – pun intended. As a growth agency, we are approached from these representatives often, and historically speaking, advice from these representatives can be super hit and miss. They can generate some good recommendations here and there, but it’s always a good idea to validate their advice and make sure it aligns with the goals you’re trying to accomplish. In the post-iOS 14 paid social ecosystem, we’ve had ample opportunity to test this new strategy, and have created a list of general “do’s and don’ts” of broad prospecting to keep in mind. 

What is broad prospecting in paid social advertising? 

Broad prospecting, as we define it for this exercise, is the intentional effort of creating minimally constructed audiences. These audiences have very few parameters on them: maybe some loose demographic targeting, and a few interests or data points to reference to. These can get up to 10m+ in size, depending on the different parameters included, and are used predominantly on social ads

Why should I use broad targeting as a part of my paid social advertising strategy? 

Casting a wide net at the top of the funnel allows you to show your products to a variety of people that might not have otherwise seen them. The running hypothesis for leaning on broad prospecting as a strategy is that the pixels associated with your ad account are much, much smarter than the advertiser running the ads.

Ironic, right? 

The theory has some merit: a pixel associated with your ad account collects thousands of data points, and is constantly learning. We equate it to cast iron: the more data it collects, the more seasoned it becomes, and the better the result. The whole premise of machine learning depends on the pixel being smarter than what we can come up with manually. Every bid, every ad placement, every conversion feeds the pixel more information. In theory, each action creates a larger data subset for the pixel to continue to optimize, and get better. 

The do’s and don’ts of broad prospecting: 

Do: 

  • Use a variety of  lookalikes
  • Test various broad prospecting techniques
  • Choose a conversion oriented objective 

Don’t: 

  • Use broad prospecting for new ad accounts
  • Optimize for in-platform events 
  • Wait too long to make a change

 

The “Do’s” of Broad Prospecting:

Use Large Lookalikes: 

Lookalike audiences are a powerful way to reach new people in your potential conversion pool. Work smarter, not harder. By using data you already have access to (think: past purchasers, people who have visited your website, people who have engaged with your accounts, etc), you can strategically build lookalikes of this data. Once you pick the source for your lookalike audience, you’re able to go a step further and select the percentage (of lookalike) you want to use, ranging from 1% to 10%. We have seen some of the strongest performance for our eCommerce partners with combining a mix of percentages – Example: Targeting a 1%, 2%, 3%, 4% and 5% lookalike audiences. By combining different levels of intent, you’re able to more broadly target potential customers and maximize your brand’s exposure in one fell swoop.

 

Test Various Targeting Techniques:

Whether you are doing light demographic guardrails, implementing various interest or behavior based targeting, or using lookalike data for your broad prospecting, we say this: move fast, test fast, learn fast. It’s the motto of David, one of our Paid Social channel experts, and I say it daily. Isolate your variables, test things in a consistent manner, and apply your learnings to your next iteration. If you have a winning strategy, isolate it into its own campaign, and continue to use the test campaign  to try  new ideas and refine your broad prospecting strategy. By isolating new techniques into a test campaign, you’re able to work around pushing all of your campaigns back into the learning phase (which can sometimes negatively affect performance).

 

Choose a Conversion Oriented Objective

Don’t waste time and money optimizing for lead generation, or one of the other productive optimization strategies on Meta. For example, if you are an eCommerce store, optimize for purchases or add to carts! If there’s one thing we’ve learned, it’s that the pixel delivers ads based on the objective and the selected conversion event. 

By choosing purchasers, you’re reaching an audience that is the most likely to purchase. If you’re optimizing to add to cart, you’re reaching an audience that is most likely to add a product to the cart. If you’re broad prospecting, adding a simple guardrail of a conversion-oriented objective gives the pixel enough guidance to find the right subset of users you should be targeting in addition to your other parameters. 

 

The “Don’ts” of Broad Prospecting:

Don’t Use Broad Prospecting for New Ad Accounts and Pixels:

The whole theory behind broad prospecting is that it uses machine learning to optimize and deliver your ads. If you have a brand new ad account, or pixel, then the machine doesn’t have enough information to create accurate and insightful learnings. We’ve mentioned “guardrails” a few times in this article: those guardrails serve the purpose of pointing the pixel in the right direction. If you have a brand new pixel without much data, there aren’t enough guardrails built in to deliver your ads effectively, and you’re better off manually targeting the audience you want to deliver ads to. 

 

Don’t Optimize for In-Platform Events 

Take for instance, lead generation ads as an example of an in-platform optimized event. In some instances these ads can be successful – But typically for highly specific goals paired with pretty narrow targeting, think retargeting people who have previously engaged with one of your leads ads. While these ads can be simple and require little effort from the user, they add a step to the process of being able to maximize the potential of this purchase intent. What do I mean by that? Well, when someone fills out your lead form then this data is typically collected in the platform. Once you have that data then you need to download the leads via Ads Manager or your Facebook Page. This seems simple enough, but generally speaking, attention spans are short. If someone is ready to convert, it’s best to capture the intent as instantaneously as possible. If you keep people waiting, the interest begins to wean off and leads might fall through the crack.

 

Don’t Try to Sell to Everyone

You may be speaking to a broad audience, but that doesn’t mean you should water down your message. We recommend using compelling creative that is user-generated to tell the story of your brand and why people should care. Hone in on those value propositions of your business, and test out different messaging. If you water down your message while broad prospecting, you won’t appeal strongly enough to anyone to get valuable insights for continued optimization. Pro-tip: Not sure what type of creative works best for your audience? Check this out!

Looking for help when it comes to paid social? 

Look no further. Whether it’s a kick-ass creative strategy, a need for structured testing, or guidance on how to find your target audience on paid social, we’re here to help. Let’s talk! 

Ecommerce Store

How to Use Google Analytics to Discover Lookalike Audiences

Ecommerce Store

Do you remember where were you on the day that the digital advertising world stood still? Do you remember what you were doing when iOS14.5 loaded onto scores of devices overnight before their owners even reached onto the nightstand to grab them and open up their social media app of choice? Our growth marketing agency jumped into the brand new world of paid social advertising and have taken away a few key learnings for the post iOS14.5 world. 

The Fallout of iOS14.5 

On April 26, 2021, Apple followed through on its promise to prioritize privacy with App Tracking Transparency. This update prompted users to either “allow” or “don’t allow” apps on their iOS devices to track their activities. 

Paid social advertisers in particular felt the blow like they were brave enough to step into the ring with Mike Tyson in his prime. Much of the targeting that advertisers had become so reliant on was either gone or no longer effective. Despite Apple and Facebook (now Meta) warning for months: so many marketers were drastically affected. 

Sure with the change, you could still target Android users, and Facebook did roll out new aggregated events to limit the fallout Some damage control measures went into place, but it goes without question that Apple had delivered a near-fatal blow. So, scrappy Facebook advertisers have had to look for new ways to find their target audience online. 

From that scrappiness, new audience targeting strategies emerged that could help social ads strategists and media buyers cut through the crowd and reach their audience. At our growth agency, we’ve identified two lookalike audiences that have proven to be super valuable. Even better, they’re accessible to anyone with Google Analytics installed on their website.

The First Lookalike: Pageviews 

The first audience we’ll discuss today is a lookalike audience based on pageviews. 

Imagine you’re looking at your analytics and you see that you have 347 transactions this week for a product. For a lot of advertisers, they either stop there or ask the question, “How can I get this number higher?”  before they close the tab and move on. Scrappier advertisers take it a step further.

Looking at Google Analytics’ acquisition report we can see the traffic generated from various channels and campaigns.

If you add in a custom segment of Purchasers, you can look at the metrics based on people that have made a purchase on the website. From there we want to know the pages per session.

Pageviews for Google Analytics Purchasers

In the case of this e-commerce company, the Purchasers had a drastically different behavior than the larger pool of all users. And this is where the beauty is.

From the data, we can tell that Purchasers visited 11.47 pages per session. They were more engaged. They clicked around, they viewed a few pages, and they inevitably visited the cart followed by the checkout page. 

We can take an educated guess that a cohort of users with that same behavior pattern would be likely to purchase as well. And that’s what we’re betting on for this first lookalike.

So back in Facebook (still not used to Meta), we’ll make our way to the audiences module within the business manager. Here we’ll be creating a custom audience.

Overview of Meta's custom audience website tool

To do this follow the following steps:

  •  Choose Website as your custom audience source. 
  • Choose the pixel you want this based off of
  • Instead of selecting all website visitors, select PageView from the events dropdown. 
  • Click the Refine by dropdown below, and select frequency. We’ll leave the middle drop-down as “is greater than”….
  • Change the number to the number of pages per session the Purchasers normally have minus 10-20% (so, if it’s 10 pages, then make it 8). We’re subtracting 2 or 3 because it gives Facebook a buffer so that they can have a large enough audience to build the audience from. 
  • Click Create audience, and then create a lookalike from that audience.

The Second Lookalike: Time on Site

The second lookalike audience uses analytics as well. Remember that the Purchasers segment spent around 11 minutes on the site. So again, we can safely assume that Purchasers spend more time on the site.

So the second audience we want to create is a lookalike based on time on site. To do this, create a new custom audience. This time instead of choosing PageView from the dropdown of events, we’ll select Visitors by time spent. 

 For the percentile, start by leaving it at 25%. If the data suggests otherwise in the future, then you could always drop it to 10% or 5%.

Be warned though. As you move to higher percentiles the audience will shrink even more. Once you’ve created this custom audience, go ahead and create a lookalike based on this one too.

Overview of Meta's Site Visitors Percentile Tool

The Real Trick to Using Analytics to Build Facebook Audiences

And just like that, you have two audiences based on data that you could target using your first-party data. And this is just the beginning. There is a myriad of different audiences you could build from the data. 

You could narrow the custom audience further by switching the parameters from Include people who meet “Any Of” the following criteria to Include people who meet “All Of” the following criteria.

You could create custom events and conversions in your pixel based on events that are important to you and build an audience based on their behavior.

You could select specific web pages to narrow your time-on-site audience. 

The possibilities are vast. The important thing is learning how to use analytics to understand your audience beyond the bottom line numbers. From there, you can segment your audience in the way that makes the most sense for your business goals.

Looking to leverage your existing data for your ecommerce site? Our growth agency is happy to dive in and work with you on a growth strategy. Let’s chat

Ad Creative Types That Constantly Drive Performance (Regardless of Industry)

Testing, testing, testing! As a creative team tucked inside a growth agency, we throw around that word a LOT. Especially because we partner with scaleups looking for quick, efficient (and sustainable) paths to growth. Making sure we’re clear about what we’re testing—and executing it within rock-solid social ad campaigns—ensures that on the other side of a few thousands of dollars worth of ad spend (and oftentimes even less), we can take a step back and confidently say, “here’s what worked; here’s what underperformed.” You can read all about that and get our tried-and-true templates in this blog!

How we set up an ad creative test at Tuff:

  • Most often when we begin to outline our tests for a new partner, we’re talking value props. Our question: “Which of your core messages is most likely to stop a scroll and win a click?” During this testing phase, we’re keeping the creative formatting relatively simple and getting very particular about the creative messaging. This way, we can isolate that variable and come to a cleaner, more definitive conclusion after our test period has ended. For one of our partners, Betterleap, this is what this looked like!

Betterleap Creative Example

  • After we’ve run a few tests and feel confident that we’ve honed in on our strongest message, we’ll begin to experiment with look and feel of ad creative. In this phase we’ll diversify creative type and formatting, launching a suite of creative that includes user generated content, UX animation, simple/bold copy statements, offers, and more.
  • Our goal in these subsequent phases is to hone in on what elements of creative assets drive those clicks. And THAT is what this blog is all about. Although the companies we partner with span across a wide range of industries, after publishing hundreds of creative assets and running dozens of tests, there are three main types of ad creative types that reign supreme. 

Note: while we run campaigns on a multitude of different platforms, this blog centers primarily on what we’ve found to drive the best performance on Facebook/Instagram.

The three types of ad creative that constantly drive performance:

1. Split-Screen Creative

Believe it or not, REGARDLESS of industry or company type, split-screen creative is consistently among our top performers. We’ve even pitted it against bold, colorful branded videos, 3D animations, custom illustrations…you name it. And split-screen creative still drives better performance. When we first spotted this trend (with our partner, AKKO) we scratched our heads and thought, “okay let’s create a fresh version in our next round and see if the trend holds up.” Spoiler alert: it maintained it spot at the top of our performance pyramid and hasn’t wavered since. 

If you’re over there thinking, “no way, jose! Video ALWAYS wins!” Well…that’s what we thought too before we saw the numbers!  

2. Made-On-TikTok Creative

TikTok is unequivocally the fastest-growing social platform. It’s a hotbed for sprouting new trends that permeate every other. It’s also the channel we get asked about the most by organizations looking to partner with a growth agency like Tuff. “Can you run ads on TikTok for me?” is arguably the question that we see most often in our “Let’s Talk” form fill

So, we started building a network of creators and making high-impact ad creative for TikTok! We also spotted an easy opportunity to test this creative outside of the TikTok ad platform. Our results: regardless of channel—but most clearly on Facebook/Instagram—our made-on-TikTok ad creative type drives incredibly strong performance (even when resized in 1080×1080 for in-feed placements). (Note: click the image to see the full video!)

TikTok Creative for Teachable

3. UX Animation

The third type of creative that consistently puts up strong click-through rate numbers is UX animation. This doesn’t just apply to SaaS businesses, though, when we can show what the user experience of any platform is like (even if it’s just a checkout flow or onboarding process—something the user might only experience once) we see performance inching higher.

Our hypothesis: when we can demystify the “how it works” part of the equation right out the gate at the top of the funnel, we subliminally communicate to our audience that we really care about their experience. So much so, we want to show them ALL the inner workings before they even click! Especially because the most-used sites on the internet are user obsessed, your potential customer has a low tolerance for clunky interfaces or ugly design. Positioning yourself as a winner in UX from the get-go is consistently a win! (Note: Click the image to view the full video!)

 

There you have it! While we’re always generating new ideas and hypotheses, these three ad creative types are ones you’ll consistently see within our ad creative suites. Because they work!

Have you been experimenting with creative formatting? We’d love to hear about it! Or, if you’re curious about what we could uncover about your organization and target audience through creative testing, let’s chat!

Person getting ready for a jog.

Kicking Dynamic Creative Ads to the Curb: How we Decreased CPA by 66% For Joyn

Person getting ready for a jog.

Joyn represents everything positive about the future of movement. True, we’re biased, but one of the best parts of what we do is choosing who we work with. And the truth is, our jobs are much, much easier (and more fun!) when we believe in our partners’ business. So, it goes without saying: we’re big fans of Joyn. 

Simply, Joyn is a movement app for every body. Built on the conviction that feeling the joy and freedom of movement shouldn’t be exclusive to muscular influencers in size 00, Joyn’s online library includes a wide range of videos led by instructors that are positive, warm, and inclusive—truly. At the beginning of each class, the instructor introduces themselves, shares their pronouns, and takes a moment to talk through their recommended modifications to the movement they’re about to facilitate. That way, people that might need to be seated can still have fun and participate. 

When Joyn reached out to us in late 2020, they had a well-established brand, product market fit, and a growing (and super excited) audience. But what they were looking to accomplish was replicating their positive growth across multiple channels and supercharging it with a growth marketing agency like Tuff. 

The Backstory

When we jumped in and got access to Joyn’s Facebook Business Manager, there was already quite a bit of historical data accumulated from past campaigns they had been running.

Similarly to many new Tuff clients, Joyn knew that Facebook Ads were a key tactic for scaling their subscription user base, so their in-house team jumped in, whipped up some creative, and launched ads to start getting a finger on the pulse of which combination of targeting and creative would drive the most conversions on the site. 

Truthfully, for any startup seeking product-market fit, this is the perfect approach. Get scrappy, launch some ads, glean some learnings, and when you’re established and ready to scale, call in more resources. 

When we stepped in, we did it with a pointed goal: drive down CPS. We paired with a clear game plan:

  1. Dig into the historical data 
  2. Test Non-Dynamic Creative 
  3. Get UGC Influencer Style Creative 
  4. Optimize what performs, ditch the rest

Joyn’s Facebook Dynamic Creative Ads: Were they Working?

After pulling and organizing the historical data, we realized that Joyn was relying heavily on dynamic creative ads, giving us an excellent place to jump in and uncover more insights. 

Dynamic ads require the Facebook strategist (or whomever is executing the ads strategy) to jump into the platform and upload several different types of creative along with several different headlines and body copy. Then, when the ad is published, Facebook—using its algorithm—automatically tests different combinations, eventually prioritizing the combinations that are most effective (“effectiveness” is measured based on whether you’ve chosen to run a conversion, traffic, video views, reach, brand awareness, or app install campaign). While generally, marketers can see some positive results using this approach, there are some significant drawbacks:

  • It’s a challenge to drop in creative that’s going to be cohesive no matter what combination Facebook serves
  • It’s relatively challenging to optimize on the fly with dynamic creative campaigns

So, we decided to take matters into our own hands and launch non-dynamic ads. The results speak for themselves. 

Launching Non-Dynamic Ads: a 66% Decrease in CPS

Our main goal when we launched non-dynamic ads was to first optimize spend toward the best performing asset. Although typically when we pivot to test new Facebook strategies (whether it’s a new audience, new bid type, or new ad creative) results are far from immediate—especially given Facebook’s seven-day attribution window.

But, after just $545 of spend, we saw a sharp drop of 62% and within the very first week we saw a 66% decrease in CPS. 

  • Dynamic Spend: $6,583.44 | 153 Start Trials | CPS: $43.03
  • Non-Dynamic Spend: $1,744.40 | 121 Start Trials | CPS: $14.41

faceboook cps decrease chat

True, non-dynamic ads aren’t for everyone. They necessitate a much closer eye and the oversight of someone that can spend time reallocating budget to best performing assets and manually testing creative combinations frequently. When done right, though, the results speak for themselves. 

Fresh Creative: Tapping Into Influencers

Next up on our agenda for Joyn was to deep dive into their creative assets and emerge with…

  1. A full assessment of the creative that’s historically been performing at the top of the pack
  2. Clear ideas for new types of creative we’d like to test

Here’s a peek at what that looked like.

We noted that the strongest-performing creative tended to be shorter videos that open with high energy and/or full-screen movement. Both of our best-performers featured a modified way to access the movement, and bright colors with quick, varying shots. Finally, we were immediately able to see recognizable Joyn branding. 

Strength Training Video  |   Yoga Video

So, the next steps: recommending fresh creative. Joyn’s library of body-positive movement classes is populated by a cohort of inclusive, positive, extremely personable coaches. So when we recommended testing influencer content, we were able to create fun, big-energy new creative on a few day turnaround without having to source or negotiate with influencers. 

We were able to get two raw videos back from two of Joyn’s most memorable coaches, Kanoa Greene and Anna Chapman, use Joyn’s internal team for some extra editing and text overlay, and deploy them without a hitch. 

While there are a few extra steps to take (both on the Joyn Instagram page and on the influencer’s personal page) once we began promoting the two videos, the results were extremely interesting.

  • Kanoa Greene Influencer Campaign: $643.18 | 14 Start Trials | CPS: $45
  • Best-Performing Audience: “Female Leaders” — CPS: $14.81

The name of the game for Joyn: drive a CPS of less than $20. And while our results for Anna’s influencer campaign were not quite as tight, serving Kanoa’s ad to fresh audiences, rotating in new copy, and testing new placements have us seeing results that are closer to what we’re aiming for. 

Ready to See What Works Best For You on Social?

While we have been able to deep dive into both creative strategy and rigorous optimizations with Joyn, no two brands are built the same. Have a suite of creative you think we could supercharge? 

Let us take a deep dive into your brand and develop a strategy built for your business. 

Download a Sample Growth Marketing Proposal

tuff-six-signs-its-time-to-update-your-facebook-ads

Six Signs It’s Time to Update Your Facebook Ads

Editor’s Note: This post has been updated with new links and examples for you to use! 

Has your Facebook ads performance dipped? Maybe your ads never achieved your desired outcome like increased eCommerce sales or lead generation. Facebook ads performance can drop off — or never take off at all –– for a variety of factors, but one of the most crucial is your ad creative (copy, images, and video). 

Across our clients, Tuff manages anywhere from $1,500 – $100,000 / month in Facebook ad spend. This article pulls from this experience and outlines six factors we’ve identified that can indicate it’s time to update your Facebook ads creative. 

If you don’t have the time to read these detailed explanations, here’s the tl;dr on when to know it’s time to replace your Facebook ads creative: 

  • Campaigns costs are going up / objective completion
  • Ad frequency is getting high causing dreaded ‘ad fatigue’ 
  • Facebook ‘Ad Diagnostic’ scores are ‘below average’
  • Google Analytics is telling you performance has declined 
  • Facebook makes an update to any part of the user experience
  • You’re not selling more or generating more leads despite an initial bump in performance after the campaign launch 

If your ads just didn’t perform in the first place, check your targeting. Even the best ad creative will tank if you aren’t targeting the right audience.

Before jumping into this read, please note, much of what we discuss is irrelevant if your tracking is out of whack. This article assumes that the Facebook Pixel, Google Analytics, and/or other tracking mechanisms are in place to measure your Facebook Ad performance. Unless otherwise stated, all mentions about measurement and metrics are in reference to data available in the Facebook Ads manager and Google Analytics. 

Campaign costs are going up. Is the cost for your campaign objective going up?

We typically focus on Facebook campaign objectives of traffic, leads (website conversions), or eCommerce website purchases. If you’re seeing the average costs for these objectives go up, it may be time to update your ads. For instance, if your campaign used to average $4 per website conversion, but now averages $6, it may be time for an ad refresh.  

Before you get an update underway, verify that the ad set level learning phase is complete (it takes at least 50 events to exit the learning phase, so depending on your budget and campaign objective, it could take a few weeks to exit the learning phase!), no major edits have been done to the campaign, and that there aren’t external factors at play. For instance, an eCommerce apparel brand might see spikes around the holiday shopping season but then dip at the start of the new year. Or a boot camp designed to help med students study might see huge growth at the beginning of the semester, but then taper off after a few months.

Your ad frequency is getting high (AKA ad fatigue)

Ad frequency is an average of how many times people in your target audience have seen your ads. It’s calculated by dividing the total impressions by the total reach. 

Although there’s no hard and fast rule to abide by, our team likes to evaluate ads for declines in performance at around a frequency of 2. Ad frequency is more of an art form to evaluate though, because frequencies that trigger declines in performance may vary by industry and audience. We have seen frequencies of over 10 lead to conversions in niche B2B verticals. 

High frequencies often lead to a phenomenon called ‘ad fatigue’ wherein your audience is simply tired of seeing your ad. Unlike paid search where intent is high, social ads are intrusive, and interrupt a user’s feed. High frequency and decreasing performance may mean your audience is tired of your ad, and that you should fire up new copy and creative. 

Facebook Relevance Scores are Average or Below Average

Facebook has assigned a ‘relevancy’ score on ads for years. In summer 2019, they broke out relevancy into three categories outlined below. The relevancy scores are now out of three possible ratings, above average, average, and below average. If your ads are scoring ‘below average’ especially in the ‘conversion rate ranking’ or ‘quality ranking’ category, consider a media and copy update. 

Facebook Ad Relevance Diagnostic Categories 

  • Quality Ranking – does your ad ‘fit’ within your audience’s newsfeed? Your ad will receive the worst rating of ‘below average’ if your audience feels like the ad is salesy, trashy, or spam. 
  • Engagement Rate Ranking – similar to organic post’s engagement metrics, are users liking, commenting, and sharing your ad? If your ad can make these things happen you’ll land best marks of ‘above average’ in this category.  
  • Conversion Rate Ranking – will users take the conversion action you’ve optimized your campaign for? Scoring an ‘above average’ here, means users are more likely to ‘convert’ from your ad than average Facebook ads. 

These Facebook Ad Relevance Diagnostics are scored comparatively across ads on Facebook. The ‘below average’ rating in any category will also tell you if you’re in the bottom 35%, 20%, or 10% of ads overall. Poor marks in ad diagnostics are one of the best indications your ad creative should be updated. 

What does Google Analytics reporting tell you?

Google Analytics can be a great arbiter of truth by offering an unbiased look at your Facebook Ads performance. At Tuff, we’ve made it a practice to gut check Facebook campaign reporting with Google Analytics reporting (don’t be surprised when you see that the analytics differ between the two platforms – we often find our Facebook metrics to be slightly inflated compared to Google Analytics). 

Using UTM parameters on all Facebook ads allows us to see how the campaign objective, audience and creative perform. In Google Analytics, take a look at your Facebook campaign and individual ad set’s cost per session over time. Look at goal completions. If costs are going up or conversions are going down as reported by Google Analytics, it’s a good indicator that it is time to refresh your ads. 

Facebook makes (another) update

Facebook and Instagram are constantly evolving to improve the user experience, and some of those changes call for updates to your ad creative to stay timely and relevant. For example, TikTok and Instagram Reels have changed the way people watch video. Short, vertical videos edited in a style that matches a particular sound are killing it right now. 

When an update like this happens, it might be time to update your antiquated video creative to stay relevant. Remember, social ads interrupt a user’s feed – make sure you’re interrupting it with content that makes sense. 

How’s your bottom line looking?

Facebook and Google Analytics tracking isn’t perfect for a variety of reasons, so at the end of the day, it’s important to evaluate your own balance sheet. Are more or fewer customers becoming leads or making purchases online? Have increases to Facebook campaigns correlated with upticks in business? 

Because of differences in attribution between the two platforms, we often see goal increases in organic and direct site traffic that correlate with an increase in Facebook spend, even though Facebook has a seemingly negative ROAS. 

Is that uptick starting to wane? Use common sense, if you launched a $10,000/month Facebook campaign and saw an uptick in business, the campaign is likely playing a role. When performance declines, it’s time to reset.

Conclusion

Facebook thrives on novelty. People are on Facebook for a number of reasons, but when they’re in the app or on Facebook.com, it’s rare they’re looking for an advertiser’s product or service specifically. Ads should be optimized to stop someone’s scroll and get them to take action. 

As a rule, it’s often good to start planning your next round of Facebook ads before performance ever dips. This way, you’re not caught on your heels when one of the above factors causes a dip in performance. Though great ads paired with ideal audiences can have a tenure of several months, we like to plan for new Facebook Ads creative every 4-6 weeks.

Facebook mobile.

[Case Study] Facebook and Instagram Ads: How to go from $0 to $43,000/day Ad Spend on Facebook in 60 Days

Facebook ads for mobile apps.

Crunch time. An App partner (iOS & Android) needed to get a massive volume of installs ASAP to support a critical holiday important for their annual revenue and new customer acquisition. 

Over 60 days we went from $0 to $43,000 per day ad spend on Facebook & Instagram. Along the way we helped the app achieve its best revenue day ever, tripled their Instagram following (a positive side effect of the massive spend, and engaging ad creative), and brought in millions in lifetime value (LTV), all while keeping cost per install (CPI) on target. 

We’ll be using “CPI” a lot in this article, so take a moment to sear its meaning into your brain before you read on. Say it with me: “CPI = Cost per Install” 

Here’s what’s included:

  • Overview
  • Campaign Setup and Results Summary
  • Days 1-30: Testing to Find Facebook Ads, Audiences, and Settings that Scale
    • Creative that Scale 
    • Audiences that Scale
    • Ads Settings that Scale
    • Tracking Troubleshooting
  • Days 31-60 The Ramp Up and Final Push
    • More testing; audiences, creative, and settings 
    • Push Budgets to Winners  
    • Event Specific Creative Push 
    • Emergency! Account Spend Limit Hit & Workaround 
    • Emergency! App Stability 
    • Final Push and Rising CPI
  • Summary 
    • Top Ads
    • Performance 
    • Final Assessment and Key Takeaways

Campaign Setup and Results Summary: 

App install campaign data from Facebook Ads.

  • The Client: iOS and Android App with in-App Purchases 
  • Primary Channel: Facebook and Instagram App Install Ads
  • Supporting Channels:
    • iOS App Store Ads 
    • Google App Install Ads 
    • Pinterest App Install Ads 
    • Email (To drive in-app purchases and user-adoption post install) 
  • The Geo: 🇺🇸
  • The Results:
    • 60 Days
    • $263,000 Spend 
    • 97,975 Installs 
    • $2.68 Cost per Install (CPI) 
    • 9.2m Facebook Reach 
    • 26.8m Facebook Impressions 
  • Best revenue day in company history 
    • Bonus Performance Metrics
      • 2.1m video views 
      • 54,000 post reactions 
      • 11,000 post shares 
      • 6,000 New Instagram followers
      • Multiple ad variations went viral 
      • Featured in the App Store

Days 1-30: Identify Facebook Audiences, Creative, and Settings that Will Scale 

After an initial planning, strategy, and goal alignment phase we jumped in. In order to protect costs and efficiency, we spent the first 30 days testing creative concepts including layout variations, and ad copy; we tested 68 audiences, and different bid optimization strategies. This section will get into what and how we tested in the first 30 days. 

Finding Creative the Scales

We went through years of creative in the Facebook Ads Manager and identified ad variations and their attributes of top past performers. We looked at metrics like click through rate (CTR), cost per install (CPI), ad quality metrics and more to identify top ads. We looked at the ads copy, creative, CTAs, and ad formats (single image, carousel, and video). 

This research revealed: 

  • Top formats: Carousel, Single Image, Video 
  • Top creative: was explanatory or had humor 
  • Top Audiences were list and event based lookalikes 

The research resulted in 12 ad concepts to be paired with the different ad formats and creative. We used existing client creative, and worked with their design team on new creative options. 

Creative testing leaned on Facebook’s algorithm to serve the ad variation that would work best. Ad sets typically had 2-6 creative variations, and the Facebook algorithm would move budget to top performers, but the Facebook Algorithm didn’t work alone. 

The Tuff team would monitor ads daily, and turn off any ad variations or ad sets that had high CPI. This would force Facebook to spend more on the other variations, which sometimes would go on to become winners.  

Audience Research

The audience investigation was similar. What audiences had the best performance metrics? Were they segmented by age, gender, or geography? Were there exclusions (users specified not to receive an ad, e.g., existing app users?) 

Though we had initial ideas on what audiences would perform well, seeing historical audience performance, gave us a running start on audience development. 

Audience targeting results on Facebook.

For early learnings we looked at Facebook Demographic reporting in the Ad Account Overview. By Looking at Mobile App Installs compared to Amount Spent, we were able to identify which demographics were likely to have the best performance. In this instance we’re looking at the ratio of mobile app installs to amount spent by age group. To note, this trend didn’t hold through the 60 day push, so it is important to continue to target all ages so opportunities for installs aren’t missed. 

Note: Audiences are selected at the Ad Set level in the Facebook Ads Manager. At times in this Facebook case study, you may hear audiences and ad sets used interchangeably. 

Generally, the Facebook campaign structure is as follows: 

Facebook ads campaign structure diagram.

In the first 30 days we tested 63 audiences, paired with a mix of creative. For our tests, we’d typically have 4-8 ad sets per campaign, and 2-6 ad variations per ad set. Over the course of the test period we would turn off underperforming ads and ad sets to push more spend to winning mixes of audiences and creative variations. 

Facebook campaign structure.

As Facebook Ads performance data came in ads and ad sets we’re turned off, signified in the chart above by “🙅‍♀️”. Only about ¼ of our ad sets survived month 1 testing, and 3 creative variations (of 12) rose as top performers. 

Days 1-30 Summary

TESTED

  • 21 Campaigns 
  • 63 Ad Sets
  • 12 Ad Variations 

RESULTS 

  • $9,821 Spend
  • 7044 Installs 
  • $1.39 CPI 
  • Three top creative variations identified 
  • 15 core audiences identified 
  • Cost-cap bid strategy identified as effective at this scale…
    …but would it last? 

Days 31-60 The Ramp Up

With top audiences, creative, and bid-strategies identified we were prepared to ramp up spend. On day 31 we had 3 campaigns live, 5 audiences, and the top three ad variations running. We spent $950 that day. From there we inched up budget at the ad set level daily, and by day 45 we hit the $2,000/day mark. 

More testing; audiences, creative, and settings

Although some audiences didn’t succeed in the 30 days, there was a chance it was due to the creative and ad settings mix. We ensured these previously tested audiences were given a chance to be paired with top creative and ad settings. 

During this period the client continued to develop new creative, and that was tested as well using the assistance of the Facebook algorithm. We also isolated some creative to guarantee Facebook spend. 

A big driving force behind this rapid Facebook Ads ad spend ramp up was a holiday important to our client’s business, and we wanted to ensure that creative specific to the holiday was served. We tested 10 holiday ad variations, and only one version took off. It would become one of our best ads for the entire 60 period, though it underperformed two non-holiday specific top ads. 

An interesting take away from the top three ads is that the event specific creative didn’t perform as well as more general app functionality ads. This may be due the holiday not being applicable to everyone who sees it. 

Facebook ad example.

Here is the top event-specific ad. It was a carousel and showcased the product offering. More on how they ad variation performed in the results and summary section. 

With top audiences and creative identified we were ready push spend way up leading up to the holiday, however, the the path to spend ramp up we encountered two speed bumps.

$5,000 Ad Account Spend Cap Hit & Workaround

Did you know Facebook has a default $5,000 ad spend cap per ad account, even on established ad accounts? That’s right! This spend cap is different from the ‘spend limit’, and can only be increased by Facebook Support. Unfortunately, support can have a several day turn around, which would be after our peak push. 

In this instance, we were able to find an immediate workaround that allowed us to keep advertising. We created new ad accounts. With each ad account having a $5,000 cap, we created 6 additional ad accounts that would take us up to the $35,000 per day in spend.

We did finally hear back from Facebook Support and get the spend limit increased, but this was a good stop gap measure to keep ads rolling. 

App Stability Issues

With this massive ramp up underway the app encountered some stability issues due to the influx of new users. This led to a temporary pause on campaigns while app capacity was addressed. 

The takeaway from this experience is that if you are undertaking a massive app install or web traffic push, have the app and website stability on your radar. How many users can your app support? Who and how will stability be addressed if there’s a crash?  

Thanks to the app’s solid team of developers, app stability issues were resolved quickly and the ramp up would continue. 

Final Push and Rising CPI

The final push up to $43,000 was made possible by attention to detail and willingness to sacrifice CPI for more spend around the important holiday.

Facebook CPI results for app installs.

As we spent more in the final days of the campaign, CPI rose as well. We followed our earlier approach of pushing budget to top ad sets and creative variations, and some of these groupings had literally hit their limit (See $5,000 account cap section above). 

The cost cap bid optimized campaigns also weren’t spending their full daily amount as Facebook struggled to find users at the cost and volume we had set forth, so most campaigns were switched to a lowest cost bid strategy, which contributed to rising CPI. Low cost bid optimization, however, increased volume and ensured campaigns would spend their set amount daily. 

Fortunately the increased CPI in this final push was acceptable because the volume of installs, and subsequent LTV supported the costs. 

Summary 

Top Three Ads:

Facebook ad results from installs.

Our top ad was a carousel. Carousels are known to do well on mobile devices, because they can be used to convey information without the bandwidth of video. This particular ad was also highly engaging and received thousands of reactions and 100s of shares over the course of the campaign. 

Facebook ad results from installs.

Our second best ad was an informal video shot on an iPhone, that shows the end product of the app (a physical card and gift). This video was paired with concise text and a headline on what the app does. The informal nature of the video may have been what made it resonate with people. 

Facebook ad results from installs.

The third best ad was event-specific, and also in the carousel format. It showcased end-products of the app, and also had the clear concise message about what the app does. Because it was event-specific, costs may have been higher, as it wasn’t relevant to everyone who saw it. All this said it was our third best ad of dozens of ad variations run over the 60 day campaign period. 

Results 

Facebook ad results for install campaigns.

Getting to $45,000/day didn’t happen right away. There was little visible activity in the first 30 days while the hard work of research, audience, and creative testing was executed. Increasing spend was only possible because of this critical foundation established early on. 

Spend peaked several days before the event this campaign was based around, after which we settled in at $1,000 – $2,000 / day spend. 

Facebook ad results for install campaigns.

Installs tracked closely with spend. This consistency was the key to our confidence as we pushed budgets up. 

Facebook ad results for install campaigns.

CPI was initially very high. To note the budgets on these learning days was very small. And CPI dropped considerably and stayed low once initial learning was complete. 

Key Takeaways to Ramp Up Spend Quickly on Facebook 

  • Test to identify top audiences, creative and settings 
  • When an audience fails, try new creative 
  • Be considerate of technical issues 
    • Is your site or app capable of the increased traffic from this kind of ramp up? 
    • Have you requested that the default $5,000/day ad spend cost cap be lifted on your Facebook ad account? 

Finally, with these principles in place, don’t be scared to push up ad spend.

Facebook has a propensity to spend what you give it especially with low cost bidding, but this spend isn’t always paired with the desired results. In this case, however, through the approach of finding audiences, creative, and ad settings that would scale, we were able to achieve a massive spend and results ramp up in a 60 day period. 

Facebook shops.

Facebook Just Shook Up Your ECommerce Strategy With Facebook Shops

How to setup Facebooks Shops and Instagram shopping.

Instagram Shopping and Facebook Shops are here, and they allow businesses to sell physical products directly through the Facebook and Instagram apps. The game-changing aspect is that there is check-out functionality so users can buy after a click on tagged product without ever leaving the apps.

In this article, I’m going to share details on how it works, how to set it up, and pros and cons of this new service. 

Here’s what’s included:  

  • What is Instagram Shopping and Facebook Shops? 
  • Purchase Flow From Post to Check-out
  • How to Set-up Instagram Shopping  
  • How to run a Facebook Ad that Includes a tagged product or catalog. 
  • Strategic Implications for ECommerce Brands 

What is Facebook Shops and Instagram Shopping? 

On May 19th Facebook announced a new service, Facebook Shops to “…make it easy for businesses to set up a single online store for customers to access on both Facebook and Instagram.” Importantly, they also said, “We’re starting to roll out Facebook Shops today [May 19th, 2020], and it will be more widely available in the coming months.” So if you’re reading this in early summer 2020, there’s a chance this feature hasn’t been enabled for your Facebook Business Manager account yet. 

For people who have been in eCommerce and managed a catalog on Facebook this announcement was a long time coming since Facebook rolled out a Buy on Instagram beta this time last year to brands like Adidas, Uniqlo, Pottery Barn and other major retailers.

Key Features of Facebook Shops 

  • Tag products and collections in posts, stories, and live feeds  
  • ‘View Shop’ button on Instagram Profile 
  • Shop tab on Facebook Profile 
  • Facebook and Instagram Check-out (Requires a Facebook Commerce Manager account) 

From Post to Check-out; Instagram Shop Purchase Flow: 

Posts with products tagged from Facebook Shops will show a small briefcase. 

Example of a post with products tagged from Facebook Shops.

A white dot and view product overlay appears on the post when opened. 

Example post with products tagged from Facebook Shops

When the image is clicked the product name and price appear. Click again and product details open. 

Example post with products tagged from Facebook Shops.

Similar to an eCommerce checkout flow, a click on “Add to Bag”, transitions the user to the shopping cart with the option to proceed to checkout. 

Example of Facebook Shops user flow.
Checkout functions as you would expect on an eCommerce website or Amazon, but here’s where it gets weird: you’ve never left Instagram.

This checkout on Facebook and Instagram approach comes with two downsides.

  • A 5% fee paid to Facebook (Be sure to confirm this amount in the Facebook Commerce Manager in case the fee has changed since this article was published). The 5% transaction fee is considerably lower than Amazon’s 14-17% fee for apparel, though it’s likely Facebook is keeping this fee low to entice sellers to join.
  • Instagram Checkout makes it so users don’t visit your website, which may cause you to lose valuable analytics audience data, and the ability to retarget to users who start, but don’t complete checkout.  

The implications for Facebook and Instagram checkout are profound. Facebook is essentially becoming its own eCommerce platform. It’s likely they have ambitions for Amazon and Shopify’s new Shop app. Layer this eCommerce ambition with Facebook’s own Libra currency, and we could see a day when people around the world are pushed to use Libra rather than their own currency to transact in this environment, but this level of functionality is likely years in the future.

For those who don’t want check-out to take place in Facebook or Instagram either because of web traffic concerns or the Facebook transaction fees, there was an option to list products in Facebook Shops, but with a redirect back to a website as seen below. 

From Dan at Facebook Support, We have updated our checkout experience in order to create a more seamless and safe end-to-end shopping experience on Facebook.

This new feature will no longer allow users to be redirected to a third-party website. The checkout method available has been established within the Facebook site, and it can be managed through your Commerce Manager.

Moreover, you can still create posts promoting your products and your website and redirect users to your website using a URL link…

… the product that has been tagged in your Instagram Shopping will have an ability to redirect to your website, as long as your account has been approved for the Instagram Shopping feature.

Also, you can still tag the products and let the user redirect to your website.

The implication of this statement is that Instagram Posts like the one below will continue to have a ‘View on Website’ option as long as they want it, thus bypassing check-out in Instagram (or Facebook). 

Instagram shopping example.

The Three Steps to Set-up Your Instagram Storefront

Official Facebook Business Instagram Storefront Guide

1. Determine Eligibility (Must answer yes to all five questions)

    • Are you in an eligible market?  
    • Do you sell physical goods? (Facebook has hinted service offering will be available at a later date)
    • Can you comply with commerce policies? You’ll want to review Facebook’s 25 prohibited product categories. 
    • Is your Instagram Account setup as a Business Account? 
      • How to check: go to your Instagram settings, if there’s a settings option that says: “Switch to a Professional Account” then your profile is still a personal account.
    • Is there a Facebook Page connected to your Instagram Account? 

2. Get a Catalog Connected 

  • Option 1: Use the catalogs feature in your Facebook Business Manager account, which includes connecting to an existing catalog.
  • Option 2: Us a partner integration. Instagram Storefront catalog partners include: 

eCommerce integrations with Facebook.

3. Signup in the Instagram App.

  • Go to your business settings and tap ‘Business’ then tap ‘Instagram Shopping. Follow the prompts to set-up your Instagram Shop. 

That’s it! After step three there is an eligibility review period which will likely take 2-7 days depending on Facebook’s review bandwidth. Once approved you may begin product tagging within posts and stories (image only at this time, but additional placements including live feeds are in the works) on Instagram and Facebook. You’ll also have a ‘Instagram Store’ button on your profile.

How to run Instagram Ads with tagged products

Currently, there is no way to tag products when creating an ad in the Facebook Ads manager. What you can do however is use an organic post for your ad. 

When creating an ad in your Facebook Ad Account, use the “Use Existing Post” option. Select an Instagram or Facebook post with a tagged product or collection. 

Steps on how to run Instagram Ads with tagged products

If your account has had shopping enabled, the post will have a ‘Checkout’ toggle. 

Steps on how to run Instagram Ads with tagged products

Turning it on, will allow you to include the tagged product and a check-out in app. 

Strategic Implications and Considerations for ECommerce Stores Determining if They Should Use Instagram Shopping 

The huge pro for eCommerce retailers moving forward with Instagram Shopping is the ability to reduce friction for shoppers. Clicking a post with a tagged product to ordering it can be done in under a minute. Facebook and Instagram store user billing and shipping info (You’ll now see this info in your own personal Instagram App settings), so there’s no need to add it on a seller’s website. In fact, there’s no need to visit a website at all, which in its current flow, will typically require users add the products to a cart, go to the cart, and check out. 

Another benefit is your listings can be on the Facebook Marketplace. Prior, the Marketplace was more like Facebook’s version of Craigslist for people to sell second hand items locally. The Facebook Marketplace is evolving to include product listings, and promoting products there both organically and in a promoted capacity could increase sales. 

For people interested in attribution, Instagram Shopping is huge. With actual transactions relayed through the Facebook Commerce Manager, there should be no question as to if a sale should be attributed to Facebook. This is huge for advertisers who grapple with website analytics not matching what’s reported by Facebook. 

There are downsides to Instagram Shopping. Facebook will be collecting a 5% transaction fee. This fee will likely rise overtime. There are lost analytics as users no longer interact with your website. This means there’s not an opportunity to build retargeting segments based on how far a user progressed with checkout. Should a company become too dependent on Instagram Shopping as a sales platform, they could face issues with changes to functionality and policies to the platform as is often seen with Amazon. Here’s one example of this (on Amazon) from a seller policy change last year.

As a brand new feature it’s also likely there will be bugs and hiccups along the way. Right now for example, it’s not clear how data from behavior in Instagram Shopping and Facebook Shops will be shared with the Facebook Ads manager data that’s often critical for Facebook Ads optimization. 

There are 120 million Instagram users in the US alone, and one billion users worldwide*. Facebook, Whatsapp, and Oculus have billions more, so leaning into this and allowing users to transact easily will make sense for many brands despite the downsides. 

I’d love to check out your account and see what’s possible for your eCommerce company. If you want to schedule a 30-minute strategy session to learn more, please do!