Social media giant Facebook is introducing a new system for measuring and optimizing conversions for all direct marketers. Conversion measurement allows the recording of consumer actions driven by Facebook ads, such as registrations, to determine Facebook ad ROI.


Under its new conversion measurement system, Facebook is also now allowing marketers to use optimized CPM (cost per mile, or cost per thousand views) to target ads to consumers with high conversion rates.

Beta testing by Facebook indicates that combining conversion measurement with optimized CPM reduces cost per conversion by 40 percent. Facebook says this will allow better understanding of the ROI ad spend while also boosting future ROI results.

As explained by Inside Facebook, conversion measurement works by generating code to add to pages where marketers want to measure conversion rates. Marketers can also create and manage code for tracking conversion on off-Facebook sites linked to Facebook ads.

While this capability has been available to large advertisers for more than a year and is also offered by third-party providers, Facebook is now offering conversion measurement (with optional optimized CPM) to all users via self-service. Inside Facebook characterizes optimized CPM as “key for e-commerce and other direct response advertisers who use Facebook ads to lead users to third-party sites.”

Conversion Measurement/Optimization Helps Avoid 2 of 3 Crucial Facebook Ad Mistakes

Earlier this month, CMSWire ran a guest article from Jim Belosic, CEO and co-founder of ShortStack, highlighting three mistakes marketers make that prevent Facebook ads from working, expanding on ideas from Nicholas Carlson of Business Insider.

While conversion measurement/optimization probably will not offer much help in avoiding mistake #1 -- acquiring low-quality fans through gimmicks, it can definitely provide great assistance in avoiding mistakes #2 -– ignoring targeting and optimization and #3 – thinking that Facebook ads don’t drive performance.

In terms of ignoring targeting and optimization, Belosic says Facebook advertisers need to tailor images and headlines, and also target users by specific interests -- all activities that could be aided by optimized CPM. And as far as thinking that Facebook ads don’t drive performance goes, Belosic directly recommends enlisting a third-party provider to help measure various conversion metrics.

Now Facebook offers that capability in-house, regardless of how big your organization is.

Conversion measurement is currently available in power editor, the ads manager and to API partners. Conversion measurement and optimization can be used on all Facebook ads, sponsored stories and in combination with any targeting capabilities. Facebook says conversion measurement is the only solution that can report when a user views an ad on one device but converts on another.