Cut Facebook Spend 10-30% Without Impacting Conversions

Conversion-optimized campaigns can achieve 50% more conversions than the click-optimized variety, however Meta needs to know who purchased the goods or services in question.

In the current climate it's essential to be efficient with every marketing dollar. Conversion-optimized campaigns can achieve 50% more conversions than the click-optimized variety, but in order to optimize for conversions Meta needs to know who purchased the goods or services in question.

Changes in the privacy landscape have inspired many advertisers to rethink their system for how to send conversions to Meta. They seek to maintain the return on ad spend they achieved previously, and Meta Conversions API (CAPI) has quickly emerged as the go-to tool for marketers to regain lost performance. 

Depending on industry and geography, we have found that it is possible to achieve a reduction in cost per action of between 10-30% post-implementation. This means you can achieve your current conversion levels with 10-30% less budget. 

However, this requires careful oversight. The guide below simply explains what implementation involves, and how to estimate the likely impact of your ad performance on Meta. We also cover a few other details to consider during the implementation process.  

What is CAPI?

CAPI is a direct server-to-server connection from you to Meta which can be used to send a wide range of conversion events, including Web, App, CRM, offline, call, and email data. 

Historically, most advertisers sent conversion events to Meta via the web pixel or SDK. In some cases, they might have used one of Meta’s individual APIs for a specific conversion use case (for example, App Events API or Offline Conversions API). Meta CAPI is the single future-proofed replacement for all of the historic individual APIs. 

Meta recommends what it calls a ‘redundant setup’, where CAPI complements the Meta Pixel or SDK. In this setup, you send all events from the Pixel - as well as from your server - via the Conversions API.

Let’s say you have a client-side event ‘Order Completed’ (triggered on the order success page) and a server-side event ‘Order Completed - Server’ (triggered upon success response from your payment gateway). 

A redundant setup would send both of these to Meta as ‘Purchase’ conversion events.

Meta would then de-duplicate these. See more information about the common pitfall below.  

Why Use CAPI?

The benefit of sending both client and server-side events is that you are likely to achieve higher coverage of your conversion events. This can happen for a variety of reasons: 

  1. The Meta pixel contains a unique ID that matches users who viewed an ad on Meta with those who completed actions on your site 
  2. However, there may be ad blockers or connectivity issues that stop client-side events from being sent to Meta. Therefore you need to fill these with server events
  3. Some events may only be available on the server. Therefore it is not possible to track via the Meta pixel; for example, when a recurring subscription has been paid. You may want to add additional information to the event that is only available on the server. 
  4. At the time some top-of-funnel events are triggered, such as Landing Page Views, you may not know the user’s email or name. In this case, Meta has insufficient data to make a successful link via CAPI, and therefore using the pixel would be better

Ultimately, sending more data to Meta results in better marketing measurement, more optimized ad targeting, and a higher return on ad spend as fewer actual conversions are ‘missed’. 

Meta says that the average Cost Per Action reduction is 13% for enterprises implementing CAPI. However, at Mammoth we have seen this number reach as high as 30% for companies in some industries and geographies.

How Much Ad Spend Could You Save With CAPI?

So you’re considering a CAPI implementation. Below are five simple steps you can take to estimate your possible savings, while still hitting user acquisition targets: 

  1. Take your average monthly Meta budget
  2. Understand how many conversions you have achieved at this budget level, to gain a rough idea of your cost per conversion 
  3. Assume this cost per conversion was 13% lower 
  4. Multiply this by the number of conversions in step two to arrive at the budget you need to hit your current conversion levels
  5. Subtract this from your current monthly budget to calculate the value of implementing CAPI 

For example: 

  1. If your budget was $100,000.
  2. Your cost of acquisition is $50 (2000 users per month) 
  3. Implementing CAPI could lower your CAC 13% to $43.50
  4. If you were to acquire 2000 users at $43.50 this would cost you $87,000
  5. The monthly budget saving would be $13,000 or $156,000 per year  

Things to Watch Out For

Event Match Quality 

In order to not ‘miss’ any results, Meta needs to match the user who saw the ad to the user who converted. The pixel carries out this task automatically using a cookieID. For server-side events, Meta relies on the advertiser providing them with hashed personal information about the user.

Event Match Quality is an indication of how effectively Meta can match your conversion events to their users. Only matched events can be used for Meta’s attribution and ad delivery optimization. Having a higher Event Match Quality helps increase your return on ad spend. 

Meta ranks your events Poor to Great and attributes a score out of 10 based on the match rate. For incrementality tests, the EMQ needs to be above 6. 

Recommendation: We often find that advertisers fail to send enough match data to Meta, which results in poor event quality scores. 

Make sure you understand the data you have at the time of the conversion event. For example, you might not have a user's email when they first visit your marketing site. Add additional data incrementally, until your events meet the 6/10 match rate threshold. 

Note: It is important to consider the privacy implications of this with your legal team. 

De-duplication of these events using parameters 

Duplication is often the hardest part of the implementation. It is required in a ‘redundant’ setup where duplicative client and server-side events are sent to Meta. 

As you are sending two events to Meta, the company needs to know that they represent the same action taken by the same user. 

 The best way to do this is by using the external_id and the event_name parameter in events:

  • external_id
  • For events without an intrinsic ID number, such as order ID, the simplest implementation is to use a user_id or anonymous_id as the external_id (although this has some limitations e.g. if the event fires multiple times in a session)
  • event_name is the standard name in Meta Business Manager

There are more advanced deduplication methods that require a more convoluted technical implementation process. However, for most advertisers, applying the user_id will suffice. 

Bonus add-on: How successful has CAPI been for your business?

Within the Meta Events Manager you can now see the ‘Status’. This shows how many more attributed conversions were completed in the last 28 days as a result of using the Conversions API alongside the Meta pixel.

A few conversions were missed by the pixel, but you can still track the incremental events that Meta is optimizing its ad delivery to. 

Note: It is important to consider the privacy implications of sending app events to CAPI. Review all actions with your legal team, especially in light of Apple’s App Tracking Transparency.

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