5 Social Media Advertising Metrics You Need To Measure [Guide]
In the last decade, social media has become an advertising powerhouse. Australian businesses spent $2.51 billion dollars last year on advertising through social media,2 trying to entice people to their products and services. However, a lot of businesses still struggle to effectively use the right social media advertising metrics to measure the success of their campaigns.
Those who know how to craft and measure effective social adverts can see a massive return on their investment—astonishing figures such as 80 times the initial investment, in some cases.3 But for those lacking this knowledge, it can quickly become an expensive exercise.
In this article, we’ll explore the most important social advertisement metrics for your business’ bottom line, so that you can truly understand how well your adverts are performing, and how to make them more potent. These metrics are relevant for the big three social networks: Facebook, Instagram, and LinkedIn.
To keep things simple, we’ll stick to the metrics for “traditional” social adverts, and not other types like boosted Facebook posts. If you’d like to learn more about those, check out our article on How To Boost A Post On Facebook.
The best social media advertising metrics
1. CPM (cost per 1,000 impressions)
Facebook CPM report
CPM stands for “cost per mille,” which is the price you pay for 1,000 advert impressions (mille means 1,000 in Latin). Impressions are the number of times your content has been shown, so understanding how much you pay for them is important.
A reasonable CPM is somewhere between $1 and $1.40,1 although this varies depending on your industry. This means it’ll cost you between $10 to $14 to get your advert in front of 10,000 people, which is why social media is such a powerful advertising tool.
Provided you’re within the expected CPM range, you should keep an eye on its stability to ensure it isn’t becoming too expensive. If it’s breached $1.40 and is driving up your total ad spend, you should try to reduce it before the campaign goes over budget.
You can try to lower your CPM in a number of ways:
- Refine your audience targeting. This may be going narrower or broader
- Improve the advert’s relevance score
- A/B test your adverts, and pick a winner
- Try changing the bidding type
Keeping your CPM low frees up budget for the campaign, which can be used to advertise to even more people. A high CPM, on the other hand, can quickly eat away at your budget, and you won’t be advertising to as many people as you could be. On the other hand, CPM also increases when you fine-tune your audience targeting, which is ok provided you’re achieving a good return on ad spend (also known as ROAS, more on this later).
If you’re interested in learning more about budgets, check out our article on the importance of a marketing budget for your business.
2. CTR
Facebook CTR report
Click-through rate is the percentage of people who clicked on your advert. It’s calculated by dividing the number of impressions by clicks, and is an excellent indicator for how relevant, engaging and persuasive your advert is. It measures whether your audience is responding to your advert, and can also help to reveal whether you’re targeting the right audience.
As with cost-per-mille, average click-through rates change depending on industry, so it’s important to identify the CTR for yours. Once you have this information, you will have a good idea of whether your advert is encouraging enough clicks, and make changes if needed.
If your CTR is low, you can improve it in the following ways:
- Ensure the advert is focused on a single, clear idea, with a good value proposition
- Try experimenting with the advert’s position (e.g. desktop news feed, desktop right column)
- Ensure you’re talking the language of your target audience. It has to resonate with them
- Use a relevant, eye-catching image
- A/B test different text and images, and pick the winner
- Improve the advert’s targeting
3. Average % of video viewed
For video ads, this metric tells you how much of the video is watched on average, and as with CTR, is a measurement of how engaging and relevant it is. If at least 75% of your video is watched on average, you can safely say that people are finding it engaging, and should stick to the same formula for future videos (until the stats say otherwise).
For more info on creating high-performing social videos, check out this awesome article from video producer BreadnBeyond.
4. Goal conversions
Every advert needs a goal, with the most common being:
- Generating leads (and ultimately sales)
- Selling products
- Collecting email addresses
Goal completions are a critical measurement of the advert’s success. If the advert is generating leads for your business, and your return on ad spend (ROAS, see the section below) is positive and worthwhile, you’re on the right track.
For Facebook and Instagram ads, goals can be tracked by setting up their conversion tracking pixel. When setting this up, you’ll define your goal type (leads, product sales, or registrations), and will see the relevant stats in Ads Manager. Conversion tracking can also be set up separately for LinkedIn.
To get a better understanding of exactly what you can measure through Facebook, you can view the specifications for their tracking pixel.
5. ROAS (return on ad spend)
Return on investment is the ultimate yardstick of business performance, and in the world of online advertising, it’s called return on ad spend (ROAS).
ROAS is calculated by dividing the revenue generated from the adverts, by the advert spend. For example, if your advert has generated $1,000 at a cost of $500, your ROAS is 2 (1000 / 500). This means that this advert is generating 2x the amount that was invested.
If your ads are designed to generate leads or sell products (i.e. they can be directly tied to revenue), you should closely monitor their ROAS to understand whether they’re sucking up your funds, or throwing free money at you.
If you sell products, ROAS becomes available when you set up conversion tracking for your social channel. Unfortunately, if you’re service-based businesses, you’ll need to calculate ROAS manually by tracking converted leads in your system, and cross-referencing them with the data from your social channels. For more information on how to do this, check out this excellent article from Social Media Examiner.
But while ROAS is a key social media advertising metric, it doesn’t paint the whole picture for you because the adverts themselves cost money to make. The true success of an advert must factor in the time spent by your staff. For example, let’s say a staff member spends ten hours creating and managing a single advert for social media. If they’re paid $50 p/hr, the advert has cost $500 to produce, which when factored into ROAS, gives you a much clearer picture of how successful your advert is.
Other social media advertising metrics
At this point, you might be asking—is that it? What about impressions, likes, comments, or any of the other social media advertising metrics the platforms provide you with? Some of these metrics can give you an idea of how your posts are performing, but they can’t be tied directly to revenue, which makes them much less important when assessing the performance of your social media adverts.
Regardless, some of these social media ad metrics can help you to create better adverts, so they’re worth mentioning.
- Likes and comments—if lots of people are liking and commenting on your post, your content is resonating with your targeted audience.
- Retweets—retweets can be incredibly valuable because they widen your audience.
- Reach—the wider your reach, the more people are seeing your advert.
- Amplification rate—the rate at which followers share your content through their networks. Reveals the advert’s potential (as with reach).
These metrics should always be considered in combination with your goal conversions and ROAS. An advert with a huge reach has good potential, but if that advert doesn’t lead to goal conversions (usually leads or sales), it hasn’t done its job. Similarly, it’s a good sign if an advert has tons of likes, comments, and retweets, but unless they convert to revenue, they’re nothing but vanity metrics.
Armed with the knowledge above, you can not only create the best ad campaigns that are available to you, but also use the right social media advertising metrics to measure the success of these campaigns.
References
1. Masooma Memon, 2020, 11 Proven Ways to Reduce Your Facebook Ad CPM, Databox
2. 2020, Facts & Figures // Social Media Statistics for 2021,
3. 18 Ways to Optimize Your Facebook Return on Ad Spend (ROAS), Databox
Cover image from REDPIXEL.PL / Shutterstock.com
Want to know more about measuring your digital marketing performance? Check out our comprehensive guide to Every Digital Marketing Metric You Need for your business. We also wrote about (non-advert) social media metrics if you’d like to learn more about those.
