The E-Commerce Metrics You Need to Master Facebook Ads

Any time I hear conversations about the miraculous power of Facebook and possible the “tricks” of the trade, they tend to revolve around the sexier aspects.

Things like Facebook’s ability to target users in almost-scary fashion (something something Cambridge Analytica) or characteristics that make a good creative usually take center stage.

Rarely do I hear any talk of metrics in these conversations. And for good reason. Sure, if you’re a true geek, metrics may be exciting. But most people would rather watch an egg boil while doing jumping jacks on lego blocks than master an understanding of metrics.

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CAC (Customer Acquisition Cost) vs. RoAS (Return on Ad Spend)

When it comes to acquiring customers, there are two metrics that people turn to in order to judge performance: CAC (sometimes also referred to as CPA) and RoAS (return on ad spend).

People tend to care much more about one than the other. Anecdotally, it seems that this preference is based purely on the marketer’s experience: marketers who worked in the trenches of affiliate digital products tend to prefer CAC, while newer marketers that got their start with Facebook ads tend to prefer RoAS.

I’m going to go through each one’s strengths and weaknesses so that you can determine which you should be leaning on.

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A Beginner’s Guide to Cohort Analyses

Let’s be honest…if you’re doing your first cohort analysis, it’s probably because a VC or marketing manager asked you to run one. And you just want to figure out the quickest way to pump one out so that you can get back to important things like working on your startup.

In reality, if cohort analyses are relevant to you (i.e. you care about retention), then they might be the best indicator of health for your startup.

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