One of the most difficult aspects of advertising is calculating the return on your investment. After all, half of all advertising is wasted but that we just don’t know which half. It’s particularly difficult to measure the ROI for Social Media campaigns where hard sales results are difficult to determine and where the return can be delivered in unusual and intangible ways, such as “Likes”, “Follows”, “Re-Tweets” and “Repins”. The standard business metrics which we typically use to gauge “traditional advertising” campaigns don’t easily apply to Social Media campaigns.
Faced with this dilemma the people at Facebook have decided to launch an Advertising ROI Tracking Tool in order to make their site a lot more accountable to advertisers. Launching this Friday, the new tracking tool will allow marketers to see how their Facebook ads perform post-click, by tracking the actions of users after they convert on the ad and go to the landing page. In order for the ROI tracking tool to work, all advertisers have to do is place some code on pages of their website that users access after making a conversion. These pages might include the check out page for an ecommerce business, or a thank-you page after filling out a form on a landing page. Once a Facebook user views this page, the Facebook ads platform is alerted that someone who viewed and clicked on a Facebook ad has converted off-site on the advertiser’s page. Advertisers will then have the option to target ads at the segments who have responded positively to certain ads in the past. The new tool will probably be of particular interest to direct advertisers who are looking for an immediate sales response to their Facebook advertising. The new ROI tool will not identify users but that it will provide information long after someone has viewed an ad, which is the kind of information advertisers need in order to measure their ROI for Facebook advertising.