Throughout my 4 years of experience running ads to grow my business, these are the 3 most important metrics I use.
These 3 metrics have to be good to lower your cost per lead:
- CTR (Click Through Rate)
- CPM (Cost Per 1000 Impressions)
- Cost Per Link Click
CTR (Click Through Rate)
This is the percentage of people who clicked on the CTA of your ad after seeing it.
1% is the general rule of thumb
If your CTR < 1%, meaning your ad is not getting enough people to click on your CTA. This will increase the cost per lead in the long run.
If after 3 days you are not getting leads and CTR <1%, kill the ad.
To increase your CTR, use a good hook and attention-grabbing ads.
Refer to this if you want to know how to create a good hook.
Use ads that stand out works too like funny ads and memes.
CPM (Cost Per 1000 Impressions)
With a low CPM, Facebook will spend less for 1000 impressions.
Hence, you will always spend less just to attract the same number of customers to sign up!
To lower CPM, target a broader audience (~1 million or more)
Adv+ targeting is getting better nowadays.
Use Adv+ targeting as much as possible and let the algorithm find the audience for you.
Just input the age and gender you like to target for your product or service.
For example, for tuition services, you target parents so you put age 30 and above.
Another tip to reduce CPM is to use ads relevant to your product or service.
Meta’s algorithm will track based on the user engagement of your ad
If your ads keep getting reported, Meta will rank your ad as lower priority and your CPM will increase.
Try to aim for CPM lower than $50 as much as possible.
However, for saturated industries like finance and real estate, your CPM will naturally be way higher as compared to industry like education and sports etc.
Cost Per Link Click
With CTR > 1% and CPM low (<$50), your cost per link click will be kept as low as possible.
The acceptable range for this will be $1-$5 link per click.
Keep testing the ad hook and creatives if your cost per link click is high as it directly impacts your cost per lead.
With these 3 metrics sorted, it means your ad is doing well.
However, if very few people are signing up, it usually means your landing page or your offer needs work.
Also do not launch clickbait ads for the sake of improving these 3 metrics.
Launch authentic ads that are related to your offer and the product or service your provide.
