A key aspect of any online advertising is keeping your cost per conversion low in order to maximize your revenue. Simply put, cost per conversion tells you how much you’re spending on advertising to acquire a conversion. When a campaign converts at a higher rate, the cost per conversion goes down and revenue goes up as shown in the hypothetical example below.
Here are three tips to help you achieve this.
Segment By Audience
The more you know about who is responding to your ads the more effective your campaigns will be. For example, one of our nonprofit clients asked us to run a remarketing campaign that targeted anyone who came to their website.
We instead created two separate campaigns. One targeted all site visitors like they requested and the other targeted anyone who visited their donate form but did not make a donation (a subset of all visitors). Here were the results:
Clearly not all site visitors are of equal value. Had we only targeted all site visitors we would never have known that donation page abandoners made up the vast majority of this audience. Armed with this knowledge we know to focus on donation page abandoners in the future and not all site visitors because the cost to acquire them is so much lower.
Segment by Device
It’s important to separate your campaigns by device as well. The client mentioned above also used Facebook advertising to target previous donors. The device people were on when they first saw the ad produced very different results. Desktop easily outperformed mobile devices so they will want to spend more on that for future campaigns.
Time of Year
In some situations audiences might more responsive during certain times of year. For a recent Facebook campaign, we targeted a lookalike audience for a nonprofit focused on curing blood cancer. The audience had performed well during a previous campaign but not this time. The reason? The first campaign ran during Blood Cancer Awareness Month and benefited from the added awareness it generated.
It goes without saying that keeping your cost per conversion low is critical. However, it’s equally important to remember that a campaign needs to produce. I have seen campaigns with a low cost per conversion but very few conversions because the number of people the campaign is reaching is too low. Identifying campaigns that strike the right balance between low cost and volume is a winning formula each time.