This in-depth article will show you exactly how to analyze all the various Facebook Ads metrics inside Ads Manager, and how to use that data to lower your ad costs and boost your results confidently.
Here's the thing: If you’re running Facebook Ads, you probably want to know EXACTLY how they’re doing.
The good news is that Ads Manager has ALL the data you could ever need to analyze the performance of your campaigns.
And the bad news?
Making proper sense of all these metrics can be pretty confusing... 
How do you know what to look for?
Which ads are doing well and which ones are struggling?
And perhaps most importantly, how to use these metrics to diagnose specific problems all throughout your funnel?
These questions have a bigger impact than you probably think - and not understanding the true meaning behind your metrics can easily make or break the profitability of your campaigns, and even warp the reality of what’s truly going on with your ads...
This is quite the technical article so I also made a handy video that breaks everything down in detail. Make sure to check it out as well.
On the other hand, properly analyzing Facebook Ads data within Ads Manager can definitely empower you to confidently make data-driven decisions and grow your business to new levels!
So to make things easier, I like to group various metrics based on the RELATIVE importance they each play at every step of the sales funnel.
And thus, we have top-of-funnel metrics, middle-of-funnel metrics, and bottom-of-funnel metrics - PLUS we also have super-back-end profit maximizing metrics.
The important thing to remember is that if you really want to use these Facebook Ads metrics correctly, you have to make sure that you group them by the role they play within your funnel.
This way, it’s easier to know exactly what to focus on primarily for each campaign, at every stage.
Now, before we start and get into the nitty gritty details, I want to clarify something real quick: the importance of tracking...
WHY TRACK FACEBOOK ADS METRICS
Look, tracking is extremely important.
In fact, it's pretty much 50% of the whole media buying experience.
So what this means is that it's not enough to just run your ads, write the copy, and then find a great creative that works. Nope.
You also have to consistently measure your results so that you can iterate on them, cut ads which aren't performing well and reinforce ads that are doing just fine.
However, there's a problem: reality is often warped, even inside Facebook's own analytics tool.
You should know that there's a 10-20% difference between the data that Facebook provides you with, and the raw data that's really there in reality.
Unfortunately, what ends up happening in a lot of cases is that Facebook attributes a sale to itself, while the source of the sale could have been something entirely different, like an email campaign or some other type of marketing channel.
So do keep this in mind and if you really want to make sure that you're getting accurate data, use Facebook Ads in conjunction with Google Analytics because this will give you the best of both worlds.
And actually I'm curious about you...
Are you using some other type of analytic software or tool to measure your performance?
If you are, leave a comment below and tell me which one is it. If you aren't using one, leave a comment with no and tell me why you aren't using one. I'm really curious.
TOP-OF-FUNNEL METRICS
All right. First of all, we have top-of-funnel metrics, and the three most important ones that you should care about are:
Now, cost per video views can be either 3 seconds, 10 seconds, or even something called "thruplay", which basically means people watching a significant portion of your video.
Now, obviously, the idea here is to get as low as possible in terms of cost, however, be careful not to obsess over these metrics too much... top of funnel metrics are not going to ultimately influence your sales that much.
However, something which IS very important is Relevance Score.
Relevance score is calculated based on the copywriting quality of your ad, the quality of your creative (the picture, video, or carousel ad that you use), and how all of these relate to the audiences that you've chosen in Audience Insights.
You want to make sure that the relevance score is as high as possible because what that means is that your ad is being run to people who are probably interested in what you offer.
As a result, the higher the relevance score, the lower your cost per click is going to be.
Here's a good benchmark:
-A relevance score of 1-2 is considered pretty bad.
-Something between 3-5 is average.
-Something between 6-8 is pretty good
-And a score of 8+ is considered excellent.
What this means is that your copy and your creative are obviously working with your target audience - which Facebook absolutely LOVES.
When you find an ad with an excellent relevance score, you should definitely duplicate it and try out similar angles, but also leave the same essence in place.
So basically, to boost these metrics, all you have to do is to experiment with various types of copy and creative and just see what sticks.
Make sure to put a lot of effort into writing benefit-driven bullets because these can really help you connect with your readers emotionally. Check out this article I wrote that analyzes 7 proven bullet formulas in great detail and reveals WHY and HOW they work.
Eventually, you WILL find the winning formula and you will see your Facebook Ads metrics improve for your entire campaign.
HOW TO FIX
IF your top-of-funnel metrics aren't doing so well, experiment with improving your ad's copywriting quality, try out new creatives, and test new audiences.
MIDDLE-OF-FUNNEL METRICS
Next up we have middle of funnel metrics, which are all about bringing people to your website or store. These include:
And one of the most important Facebook Ads metrics here is cost per click.
Now, when analyzing your cost per clicks, don't just look at "link clicks" because link clicks refer to people who've interacted with your ad in any form or shape (ex: clicked on "read more", or on your picture)
Instead, you should look at "unique link clicks" because this is what counts at the end of the day.
Another important metric is click-through rate and this is basically the conversion rate of your ad (Unique link clicks / impressions)
The higher this number, the better position you are in.
However the average click-through rate is between 1-2% anyway... So again, don't obsess over this.
But as a general rule of thumb, if your click-through rate is under 1%, there's definitely room to improve.
If it's between 1-2%, that's pretty average (but this also depends on your industry)
And if it's higher than 2%, then you have a pretty good ad, which is obviously working, and the copy and creative are connecting with your audience pretty well.
And what about the ideal numbers for cost per clicks?
Ideally, these can range anywhere between $0.5-$5.
It heavily depends on your industry and the strength of your ad.
For example, in 2018, the average cost per click across all industries was $1.72 - but remember, this is based on average quality copy, creative, and audience selection.
So, all in all, what are the most important Facebook Ads metrics related to the middle of your funnel?
The first one is cost per lead, which is your total spend divided by your total number of new leads.
This can range from as low as $2-3 to as high as $70-75! There's a huge difference between industry to industry here.
For example, in the Education niche, you can get a lead for about $5, but if you're in Legal or you're selling Insurance, then be prepared to shell out over $50 for a lead. Ouch!
It's just the nature of that industry.
Another important metric for the middle of your funnel is Lead-form conversion rates.
However, I left his last because it's one of the most complex metrics and it also depends on external things such as your landing page and website (where you're funneling traffic to).
If you're experiencing bad results with this metric, then you should definitely consider double checking the message matching between the ad copy and the landing page copy you're driving traffic to.
As I explained in this article, your landing page HAS to be the natural continuation of your ad.
Why?
Because once people click on your ad, they expect to see the same type of headline, the same type of messaging, and the same type of offer as the ones mentioned in your ad.
So keep this in mind and if you see that your cost per leads are high - higher than your industry average - then chances are, your message matching is off.
Also, another common problem that raises ad costs is that you might have some irregularities with your audiences.
...Maybe the audience that you've selected isn't really the best fit for your copy and creative combination...
In this case, try out new audiences with your ads and you might be able to see a nice little improvement here.
And regarding the landing pages - Make sure to use some type of heat mapping software like Hotjar or SmartLook because this will allow you to really see what people do once they land on your website, how they interact with your elements, how they scroll, and what they click on.
This will give you a much better chance of understanding what they want and how to give it to them so that they actually convert.
HOW TO FIX
IF your middle-of-funnel metrics aren't doing so well, focus on improving/refining your audiences, re-think your niche, and optimize your landing pages or website.
BOTTOM-OF-FUNNEL METRICS
All right, next up we have bottom-of-funnel metrics and these are the real money makers.
Basically, these metrics will show you how well your ads are generating new customers for you. And the most important are:
Arguably the most important metric here is cost per acquisition.
You should definitely focus on this one if you're in eCommerce because it's the prime number that influences your bottom line.
If your cost per acquisition is around 85% of your average order value (AOV), you're in a good place.
If it's higher than that, you're probably going to lose money.
And if it's lower than 85%, you're most likely profitable.
Another important metric that ties in very closely with this is revenue per visitor.
Now, you obviously want to maximize this, but in order to do so, you have to optimize your sales funnel first.
As you can see, these bottom-of-funnel Facebook Ads metrics tie in very closely with your end-to-end sales funnel, including how well your landing pages, product pages, and checkout pages are optimized.
Plus, how well your back-end is set up, how well your abandoned cart email sequences are performing, and many other things.
If you put in the energy and optimize all these assets, you can reliably raise your average order value (AOV) and lifetime customer value (LCV), no problemo.
Plus, you can also stomach a higher cost per acquisition up-front because your back-end will generate that money back in the long run - IF it's well-optimized.
So what to do if your cost per acquisition is too high?
Well, the first question to ask is this:
"Is my offer compelling enough?"
You see, what ends up happening in a lot of cases is that many companies try to sell or promote things that people simply don't want. They have bad offers.
And if your offer is not good enough... if people don't desire it, then your cost per acquisition will inherently be high.
If that is the case, try to switch up your offers a bit, offer another type of product or course because people might simply be more receptive towards it.
Also, you should definitely diagnose sales funnel related problems - this is extremely important.
Make sure that your upsells, cross-sells profit maximizers, and down-sells are all working in tandem and as intended, so that you can squeeze every little bit of profit from that customer.
This will boost your numbers, no doubt.
PRO TIP: You can definitely use heat maps for this as well to discover how your visitors are interacting with your site, and what they're doing at various stages of your funnel.
Then, based on this data, you can easily optimize the friction points that are underperforming. It's basically just a numbers game.
Just try to raise the individual conversion rates at various parts of your funnel, and you should be able to see a nice improvement
HOW TO FIX
IF your bottom-of-funnel metrics aren't doing so well, re-think your offer, improve your upsells, cross-sells, and down-sells, and conversion optimize each part of your funnel.
RETENTION & MONETIZATION METRICS
And finally, we have retention and monetization Facebook Ads metrics.
These tie in very closely with the bottom-of-funnel metrics because they're all about maximizing lifetime customer value (LTV) and that average order value (AOV).
What you should definitely optimize for here is return on investment (ROI) on the long run.
For bottom-of-funnel metrics, you look that immediate return on investment. Now, you're looking at return on investment over 7 days and even 30 days.
For example, it's totally possible that somebody clicks on your ad, they don't buy anything for two weeks, and then they suddenly buy something out of the blue. And then they buy something else... and then you get to upsell them to something else again.
This is VERY powerful.
All of a sudden, you have someone who's bought three things from you three weeks after they've seen your ad.
THIS is what really counts towards your long-term return on investment.
And why should you care about this?
Because this allows you to do more advanced stuff like getting new customers at an immediate loss...
...which you can afford because you KNOW that eventually, you're going to convert them into repeat buyers and they're going to make up for that initial loss.
Pretty sweet 🙂
However, please be careful with this because in order for it to work, you have to have really, really solid metrics and a well-oiled sales machine...
...Basically, a revenue generating engine that's fine-tuned for conversions.
So in order to pull this off, you have to know your conversion numbers very reliably at various stages of your funnel. Otherwise, you might very easily end up losing money with your Facebook ads.
However, if you KNOW that your funnel is working well and it's fine-tuned for all these additional conversions, then you should definitely experiment with these profit maximizing ads.
Remember, even though they might be unprofitable in the extreme short-term, they can become profitable in the long term.
Basically, just ask yourself:
"Can I take a short-term loss to acquire long-term customers?"
If you can, feel free to experiment with it. If not, then stay with the basics and you'll be just fine.
HOW TO FIX
IF your retention & monetization metrics aren't doing so well, increase Average Order Value, add more back-end revenue, and focus on customer retention.
HOW TO PRIORITIZE FACEBOOK ADS METRICS
Congratulations for reading this far, you're awesome!
Now that we've covered all the performance metrics you should really care about, does this mean you should track all of them closely all the time?
Fortunately, the answer is no.
Unless you have a dedicated analyst or you want to act like the analyst in your company, you should always concentrate on performance metrics one at a time, based on your specific campaign objective.
For example, if your objective is to gather new lead signups, then you shouldn't really look at a cost per acquisition and all the other long-term metrics because what you really care about in that moment is... cost per leads.
The same thing applies if you want to make new sales. In this case, what you should really care about is cost per acquisition, and not cost per video views, for example.
Sure, it's great to know your cost per video views so you can optimize and fine-tune your videos.
But ultimately, what you really care about is cost per acquisition, as this is the thing that will give you relevant insights so you can make fine adjustments which better serve your objective.
Of course, if you have the capacity for it, - by all means - monitor everything.
Just make sure that you KNOW the main objective of your campaign, whether that's gathering leads for your email list, going after video viewers so you can build a retargeting audience, or generating sales to grow your bottom line.
The primary performance metrics you should care about are always closely tied to these various objectives.
And that's pretty much it.
Make sure to also check out the video as well if you want to truly master these concepts.
AND REMEMBER: You DON'T need to obsess over each & every one of these Facebook Ads metrics (although you certainly can)...
Instead, always choose specific performance metrics based on the purpose of a given campaign.
For example: Cost per lead (CPL) for lead signups, Cost per acquisition (CPA) for acquiring new customers, and Average Order Value (AOV) for maximizing your back-end revenue and profit margin.
And there you have it - a detailed list with the most important metrics to watch out for when running Facebook Ads.
Hope this helps 
You might also want to check out another video of mine that reveals the 3 Best Facebook Campaign Objectives you should be using for every type of marketing objective (and which ones to avoid).
And now it's your turn: leave a comment below and tell me how well YOUR metrics are performing - and we'll figure out a way to definitely boost them!
