The #2 metric you should be tracking as part of your Facebook Lead Ad campaigns is Cost Per Lead.
From your Facebook Ads manager account it should be pretty easy to find. The default report for Lead Ad campaigns includes a column called Cost per Result. In this column you should see your cost “Per On-Facebook Leads“.
This is your cost per lead, as in how much it’s costing you when someone clicks on your add, then submits the lead form.
As you can see in the list of campaigns above, our cost per lead has varied greatly depending on the campaign.
In the “LS – Facebook Targeting Map” campaign, we were giving away a free guide to Facebook ads targeting, so the cost per lead was low at $0.32.
In our “LS – Remarketing – 30% Discount” campaign however, the cost was much higher at $6.79 per lead this campaign targeted much fewer and more qualified people.
What’s missing from this report is the #1 metric you should be tracking.
What’s the #1 metric you should be tracking?
The most important metric to be tracking as part of your Facebook lead ad campaigns is a little harder to track, particularly if your final transaction with your customers occurs offline.
The most important metric you should try to track is your Cost per Sale (CPS).
Cost per Sale is how much money you have to spend on advertising to sell one item.
To calculate your cost per sale, you need to know the number of leads (on average) that convert to sales.
Then to Calculate Cost Per Sale:
(Number of leads x cost of lead) / Number of sales = Cost Per Sale
For example, if you had 10 people fill in your “request a quote” form, each costing $1 per lead, and 1 in 10 convert to a sale. Your cost per sale is $10:
(10 x $1) / 1 = $10
Why is Cost per Sale important?
Hopefully you have a good idea of what it costs you to deliver what you are selling. Once you factor in your Cost per Sale in advertising dollars, then you know how much profit you will make per sale.
When you’re selling a high cost product like real estate or vehicles, you know that you can probably tolerate a high cost per sale, say $500 for example.
But if you’re using leads to try to generate sales for a $10 widget that has production and shipping costs associated with it, then your cost per sale needs to much lower.