Facebook Incrementality

Facebook Incrementality: What You Need to Know

As the dominant players in online advertising, Facebook and Google continue to push technology that aids advertisers in optimizing campaigns.

Facebook’s latest “Test and Learn” tool, called Facebook Incrementality, offers assistance in identifying optimal campaign strategies across Facebook, Instagram, and Audience Network.

Here’s what you need to know about Facebook Incrementality to take advantages of its capabilities.

Incrementality Basics

The basic question for Incrementality is “Are the number of increased conversions a result of your Facebook ads?”

In other words, if you hadn’t run any Facebook ads, how many of the users in your audience would have converted anyway? And, what is the cost to convert those incremental users?

The Test and Learn tool dynamically splits users in your target audience into 2 buckets: 1) Those users that saw your ad, and 2) Those users that did not. This is a change from the traditional Facebook Conversion Lift study where Facebook creates a “hold-out” audience ahead of time. This means that the Test and Learn method results in no impact on performance, as your target audiences remain intact.

Once you determine your incremental cost per conversion, compare that to CPA across various attribution windows (1, 7, 28-day click + view) to determine which window offers the most accurate reflection of Facebook’s impact on your overall business. Optimizing towards an accurate conversion window allows you to more closely align Facebook performance with business goals.

Conversion Events for Comparison

With the Test and Learn tool, you can measure the cost per incremental action at each stage of the funnel, so it is important to understand your conversion objectives before using Incrementality. For example, Site Visits, Add-to-Cart, Purchase, Lead, and In-App Activity are all common conversion outcomes you might prioritize in your campaign and testing.

Budgeting for Your Test

Facebook has removed minimum spending requirements for Incrementality. This may leave you wondering what you should be spending, but there’s no magic equation.

Ideally, you want to set your budget at one that generates enough of a reach to allow for significant test results. The more you are willing to invest in your test, the more precise the results on conversion comparisons.

Along with budget, another thing to consider is how long to run the test. Because the tool runs in the background with no impact on performance, you should let it run long enough to generate statistically significant results.

Utilizing the Results

The test reveals the “cost per incremental conversion” generated from your test campaign by dividing incremental conversions into your spend. Facebook also tracks the statistical significance of the likelihood and degree of incrementality. This rate offers insight into the benefits of the strategies applied.

Better Insights For Better Strategies

Facebook Incrementality is a great tool to help you not only to pinpoint crucial touchpoints but also gain a deeper understanding of how various interactions with your audience impact your business outcomes. With this kind of insight, you will have the data you need to improve campaign effectiveness and increase ROI by allocating resources to where they are most effective.

For more insights on Facebook and other digital advertising strategies, read testing Facebook ads to sell out arenas.

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