Every advertiser wants performance, but not every advertiser defines it the same way.
“You can’t really define performance monolithically,” Fred Leach, Meta’s VP of product management, told AdExchanger.
On Wednesday, Meta announced that it’s working on a series of AI-powered optimization updates to its ads system so advertisers can customize business objectives and measure incrementality.
Meta is also giving advertisers the ability to connect their third-party analytics tools directly to its ad platform via API. It’s already testing integrations with Google Analytics and Northbeam, with plans to add Triple Whale and Adobe Analytics soon.
These additions are part of “a longer-term journey,” Leach said.
“We’re making changes to improve the system so we can get to a place where we’re providing customized optimizations for every individual advertiser,” he said. “That’s obviously aspirational, but it’s where we ultimately want to get.”
Free to be you and me
One step on that longer-term journey is a new feature called “conversion value rules,” which is still in early testing and allows advertisers to optimize campaigns based on their definition of a valuable conversion.
“It’s surprising how much variability there is even within the same vertical in terms of how advertisers think about their business,” Leach said.
Lifetime value, for example, might be a top priority for one advertiser, while another would rather optimize for profit.
In the coming months, Meta plans to expand its testing so advertisers can apply conversion value rules to specific audiences.
Take a fashion retailer running a campaign to reach trendsetter types between the ages of 18 and 25. As the campaign progresses, different segments – maybe older, maybe younger – start to gravitate toward the brand. Rather than segmenting out those new targets and running a separate campaign, a retailer using conversion value rules could prioritize the new audiences on the fly and automatically set a higher bid to reach them.
“It’s like being able to tune how you value different conversions at different moments in time,” Leach said.
Can I give you a lift?
But although “value” may mean something a little different depending on the business, every advertiser wants incremental conversions.
Meta is planning to release a new setting in its ad platform later this year so advertisers can optimize for conversions Meta believes wouldn’t have happened without that person seeing a Facebook or Instagram ad.
But how can Meta know that? Well, it can’t, Leach said, at least not for certain.
“No one can actually know which individual conversions are incremental,” he said. “The only way you could is if you have parallel universes where you show an ad in one and not in the other and then see who bought something.”
Meta tackles this problem using conversion lift tests that look at the aggregate number of conversions across test and control groups to get a sense of which campaigns are delivering more lift.
“The system learns which features of a campaign delivered more lift, and then we optimize toward that lift outcome,” Leach said.
It’s a third-party party
Still, Meta must contend with its reputation as a liberal grader of its own homework. Advertisers need to trust that its measurement isn’t biased and also reflects the totality of their marketing.
Facebook and Instagram may be huge, but people also spend time – and convert – on other channels.
Meta’s new API integrations with third-party attribution partners, including Northbeam and Google Analytics for starters, should make advertisers feel comfortable that they’re getting a realistic picture of campaign performance, Leach said.
“At the end of the day, in terms of giving us credit or not, it’s the advertiser that ultimately makes the call,” he said. “They have systems in place to help them make decisions and allocate their advertising spend – and we’re very much acknowledging that.”
Meta is warning advertisers, though, that they may see an increase in CPMs as its ads system improves at identifying more valuable conversions.
But that’s only natural, Leach said. “CPMs are really just a proxy measure for advertising performance,” he said. “The cost per acquisition or the cost per action will actually be going down.”
Hot cuppa attribution
But higher CPMs haven’t been a problem for DTC coffee brand Javy Coffee, said Matt Faber, its head of growth.
Javy, a very heavy Meta spender, is one of the advertisers that’s been testing the new integration between Meta and Northbeam. The brand typically spends around $50,000 a day on Facebook and Instagram, and it hit a record high of nearly $400,000 in a single day across Meta apps on the Fourth of July.
“It takes a lot to get to that level of spend,” Faber said. “Once you’re over the $10,000 a day threshold on Facebook, it starts to get a little complicated because you’ve got so many ads running at once and you’re not sure which ads the sales are coming from.”
The integration with Northbeam allows Javy to share aggregated campaign information with Meta, such as the number of conversions Northbeam attributes to Meta for a given campaign compared to other channels.
But before Northbeam had a direct integration with Meta’s platform there was often a discrepancy between Meta’s platform reporting and what Javy saw in its Northbeam dashboard.
“The newer integration has really tightened things up,” Faber said. “We need to know that we’re putting our spend behind the right ads – otherwise, there’s no way to get good performance.”
