The third eBook in the Paid Growth and Campaigns category. It assumes you've read Paid Ads for Small Businesses and decided that a discovery-led channel fits your business better than search. From here it goes deep on the specifics of Facebook and Instagram ads for a small budget: audiences, creative, offers, retargeting and the monthly review that keeps spend honest.
Members ebook·7 chapters· 35 minute read
Chapter 6
Reading Campaign Results
The four numbers that tell you whether the campaign is working, the dozen vanity numbers that don't and a simple monthly review that takes thirty minutes.
The single biggest reason small business owners conclude that Facebook and Instagram ads don't work is that they were looking at the wrong numbers. The platforms surface dozens of metrics by default - impressions, reach, engagement, click-through rate, post saves, link clicks, video three-second views, video thirty-second views - and almost all of them are interesting and almost none of them tell you whether the campaign is paying back. Owners who track those numbers feel busy and informed. They also tend to make decisions that quietly cost them money.
The truth about whether a campaign is working sits in four numbers. They're calculable from the platform's data with about ten minutes of work a month. They're the same four numbers we used in the earlier eBook Paid Ads for Small Businesses and the earlier eBook Marketing Budgets and ROI - because the maths of paid acquisition doesn't change between channels.
This chapter is about those four numbers. By the end you'll have a simple monthly review you can do in half an hour, a clear rule for when a campaign is paying back and when it isn't, and the discipline to ignore the comforting numbers that don't change anything if you act on them.
The full chapter walks through the four numbers that matter, the simple monthly review that uses them, the rule for deciding whether to keep, scale or pause a campaign and the vanity metrics to ignore.
The four numbers
Cost per result. Whatever you optimised the campaign for - lead, purchase, page view of the offer page - the cost per one of those events. The platform calculates this for you. It's the cleanest signal of whether the ads are doing the job at all.
Conversion rate from result to customer. The number of those results that turn into actual paying customers. The platform doesn't know this. You count it from your own records. If you got fifty leads and sold to four of them, your rate is eight per cent.
Cost per customer. Total spend divided by the number of customers won from that spend. This is the only number that matters in absolute terms. Everything else is a step toward this.
Average customer value. What an average customer is worth to you in their first ninety days. Cost per customer needs to be meaningfully less than this, with enough margin left to cover everything else the business has to pay for.
The thirty-minute monthly review
Once a month, sit down with the campaign data and the customer records and walk through five steps. It takes thirty minutes if your records are tidy, an hour if they aren't and the time spent tidying them is the second-best return on attention available to a small business owner this year.
The thirty-minute monthly review
01Open the campaign report. Note the total spend and the total number of results for the month.
02Open your customer records and find every customer won in the month who came from the campaign. Count them.
03Calculate cost per customer (spend divided by customers) and conversion rate from result to customer.
04Compare cost per customer with average customer value. If it's less than half of average customer value, you have headroom to scale. If it's more than average customer value, something is broken.
05Write down one change for next month - new creative, new audience, paused ad set, increased budget on the best-performing one. Just one.
The keep, scale or pause rule
After at least sixty days of running, look at cost per customer against average customer value. Three rules cover most decisions. If cost per customer is less than half of average value, you can responsibly scale - increase the budget on the best-performing ad set by twenty to thirty per cent and run another month. If cost per customer is between half and full average value, keep running and refresh creative - it's working but it's not got headroom to scale yet. If cost per customer is above average value after sixty days of honest running, pause and rebuild from the offer outward - more spend won't fix it.
Don't make these decisions before sixty days. The platform doesn't have enough data and neither do you. Owners who decide on day fourteen are deciding on noise.
Vanity metrics to ignore
Numbers to ignore on a small budget
Reach and impressions - they tell you what you spent on, not what you got
Three-second video views - everyone scrolls past three-second mark
Click-through rate without a corresponding conversion rate - clicks aren't customers
Cost per click in isolation - useful only relative to conversion rate
When the numbers contradict your gut
Sometimes the numbers say a campaign is working and it doesn't feel like it. The monthly review will save you from switching off something profitable just because it didn't feel busy. Sometimes the numbers say it isn't working and it feels like it is - the page got plenty of traffic, the inbox felt active, but the customer count came out low. Trust the numbers. Feelings about a campaign are usually a measure of how interesting the creative felt to make, not whether it brought in customers.
What to do this week
Build the monthly review template now, before you need it. A simple spreadsheet with the four numbers and a column for the one change you'll make next month is enough. Set a calendar reminder for the same day each month. The discipline of doing the review the same way every month is what separates an account that quietly improves from one that drifts.
Recurring principle: review results and improve the system. The four-number review is the practical version. The earlier eBook Marketing Budgets and ROI is the deeper version of the same idea applied across all channels.
The rest of this chapter walks through the practical steps, the templates and the checklists you need to put it into action. It includes worked examples, copy frameworks and the small decisions that make the difference between a plan that sits in a drive and one that gets used.
Inside you'll find a step-by-step playbook, a downloadable template, a checklist you can run this week and a short list of common mistakes to avoid before you start.
The full action plan, broken into weekly steps.
Ready-to-use scripts, templates and checklists.
Worked examples for different sized businesses.
Common mistakes and how to avoid them.
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