YOUR

2023 FACEBOOK
AD OPTIMIZATION
CHECKLIST
INTRODUCTION
There are tons of guides out there on how to create your first Facebook ad
because truth be told, that’s the easy part.

The hard part is figuring out what’s not working within your campaigns and
going from barely profitable to creating ads that maintain a healthy ROI.

That’s exactly what we’ll be doing in this guide.

In our Facebook Optimization Checklist, we’ll be covering a top to bottom sweep

of your entire campaign creation process and optimizing each step along the
way. We’ll be focusing on:

● Optimizing your Facebook ad tracking

● In-depth analysis of your targeting, creatives, and budget strategy
● How to create a testing methodology to repeat and improve your
optimization at scale
● How to automate your optimization and performance debugging along
the way

These tried-and-true strategies are something we employ at Madgicx to ensure

our campaigns (and customers!) are set up for success. Using these tips, we’re
able to help our customers achieve 5X ROAS, 2x revenue, and a 15% increase in
CTR.

Without further ado, let’s dive in!

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TABLE OF CONTENTS
4 CHAPTER 1: OPTIMIZING YOUR TRACKING 38 CHAPTER 4: OPTIMIZING BUDGET WITH
AND ATTRIBUTION LOSS-PREVENTION AUTOMATION

6 The Facebook (or Meta) Pixel 39 Permanent Stop Loss for Underperforming
7 Offline Conversions Ads.
8 Server-to-Server Tracking (Conversions API 41 Temporary Stop Loss for Ads That Don’t Drive
Gateway) Clicks
9 What If I Can’t Set Up the Tracking Myself? 42 Revive Ads You Turned Off Due to Delayed
Attribution
10 CHAPTER 2: OPTIMIZING YOUR
FACEBOOK ADS TARGETING 45 CHAPTER 5: OPTIMIZING YOUR
FACEBOOK AD CREATIVES
10 Full-Funnel Targeting Optimization
12 How to Create a Facebook Ad Sales Funnel 46 Ad Format Optimization
48 Messaging Optimization
13 Prospecting
50 Design Optimization
14 Re-Engagement
15 Retargeting
53 CONCLUSION
16 Retention
54 THE ULTIMATE FACEBOOK AD
17 Audience Type Optimization
OPTIMIZATION CHECKLIST
21 CHAPTER 3: OPTIMIZING YOUR CAMPAIGN
55 READY TO DRIVE KICKASS ROAS?
SETTINGS

22 Budget Distribution Optimization

25 Campaign Objective Optimization
27 Campaign Budget Optimization (CBO) vs. Ad-
Set Budget Optimization (ABO)
30 Bid Strategy Optimization
35 Ad Placement Optimization

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CHAPTER 1: OPTIMIZING
YOUR TRACKING AND
ATTRIBUTION

When optimizing your Facebook ads, you might be inclined to dive right into your
creatives and targeting. After all, they’re truly the most fun to optimize.

What’s even more important, however, is ensuring that:

A. You capture as much conversion data as you can to see the full spectrum
of your results
B. The data you do have is accurate and reliable so you can make the right
decisions

That’s why step one is to first analyze and optimize your tracking and attribution.

Unfortunately, due to changes brought about by the introduction of iOS 14, this
has become increasingly harder yet even more important to do.

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Without optimizing your ad tracking, you won’t be able to verify the number of
results (clicks, add to carts, purchases, etc.) or how much revenue you earned
from those sales. This means you could easily wind up spending more money
than you earn from your ads without even realizing it.

Trust us, that’s not a good position to be in.

On top of that, you’ll lose out on key audience insights or the ability to retarget
those who land on your website. Retargeting audiences are some of the most
powerful targeting options you have available and will be a key component in our
audience optimization section below.

Suffice it to say, every minute you spend without the proper tracking setup is time
spent throwing money down the drain.

Instead, let’s focus on how we can fix that situation for good.

Today we’re going to cover the 3 main methods of tracking your Facebook ad
data - the Facebook Pixel, Offline Conversions, and server-to-server tracking
(Conversions API).

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The Facebook (or Meta) Pixel
The Facebook Pixel (now called the Meta Pixel)
is the primary tracking method when you create
your ad account.

This piece of Javascript code is inserted on your

website and tracks different actions (events) that
happen on your website. These can be things like
purchases, page views, add-to-cart actions, etc.

If you haven’t yet installed the Pixel on your

website, we have a full guide on the process here.

In short, you’ll need:

party companies. Apple now requires every app

● A website to place the code on and the
ability to edit the code base (unless you’re
using a website service that has a native
integration)
● Access to your Facebook Business
Manager account
● Your Pixel code (if installing manually)
Installing the Pixel is considered the baseline for
your tracking setup. As we mentioned earlier, this
Pixel has unfortunately been made less effective
since the iOS 14 update.
Due to privacy issues post-iOS14, Apple has
restricted the type and amount of data that is
sent to your Facebook dashboard from third-
in the App Store that tracks user data to prompt
users by asking them if they’re willing to opt-in for
tracking—meaning the default is to be opted out
of any tracking.
This means that even if your Pixel is installed,
iOS users will not be counted towards your
conversions or be available for retargeting
in your audiences, among other issues, unless
they’ve specifically opted in.
While this sounds like bad news, don’t fret just yet.
There are a few other ways we can ensure we’re
capturing as much data as we possibly can from
our ads.

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Offline Conversions
The loss of Pixel data hit advertisers hard, that’s
true. But like every other obstacle in the past,
advertisers came up with a work-around to help
them regain all that lost data.

That workaround is offline conversions, although it

was around long before the issue arose.

The basis for offline conversions was to ensure

that businesses with physical locations could also
track any conversions (bookings, purchases, etc.)
that happened as a result of a Facebook ad.
Using Offline Conversions also allows you to:

This was done by uploading (manually or

automatically with Offline Conversions API) a list of
your events with customer data. This could be in-
store transactions, a list of downloaded leads, etc.
Since the introduction of iOS 14, advertisers have
also been using Offline Conversions as a way to
recapture lost data from ad tracking even if they
don’t have a brick-and-mortar store. By giving
Facebook the missing components, you can
regain some of that lost attribution.
● Regain access to the 28-day attribution
window which is no longer supported under
Facebook’s new ad set level attribution
setting for web conversions
● View performance breakdowns by gender,
age, location, platform, device, etc.
Just like before, we’ve got your back with a handy
guide on how to set up your Offline Conversion
tracking that you can read here.

While the Pixel and Offline conversions combined

give us a vast majority of our data back, there’s
still one last tool up our sleeves.

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Server-to-Server Tracking Facebook took another step forward and

(Conversions API Gateway) developed two solutions based on the

Conversions API:
Lastly, we come to server-to-server tracking.
1. Conversions API Gateway (using the
As we mentioned before, since iOS 14, Apple Amazon API Gateway)
limits the data that’s passed from third-party 2. Conversions API for Server-Side
providers back into Facebook via the pixel. Google Tag Manager (GTM)

To combat this, Facebook released the

By using the Conversion API Gateway instead of
Conversions API feature, and went even as far
the basic Conversion API setup, you can pass data
as to make this mandatory. Typically, this setup
directly from your hosting server to Facebook—
is done via a third-party integration like Shopify,
meaning you become the first-party data provider
WordPress, etc.
and can skirt around the third-party rule.

Unfortunately, as we learned earlier, that means

The process looks a little something like this:
the data is still passing through a third party, and
thus, we’re not able to capture the data that’s
being passed back and forth.

Conversions API

Client Server

Facebook
Pixel

Customer Client Website Web Browser

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The Conversions API Gateway is superior as it’s
impervious to ad blockers and is not restrained by
cookies or browser performance.

That being said, Facebook’s recommendation is to

use both the Pixel and Conversions API Gateway
together. Facebook will de-dupe the triggered
events internally by processing events through
both paths giving you more data without the extra
headache.

You can find our setup guide on the Conversions

API Gateway here.

In our opinion, only by using all 3 tracking services

available to you (pixel, offline conversions, and
Conversions API Gateway) can you capture the
full spectrum of your ad results. This way, you can
With Cloud Tracking, Madgicx will set up and
ensure you’re making the best decisions about
maintain all the tracking services we mentioned
your ad strategy and keeping your campaigns
above within 2-3 business days - with no coding
ROI-positive.
required on your end.

Our clients see an average lift of at least 20%

What If I Can’t Set Up the
Tracking Myself?
eCommerce business owners tend to wear a lot
of ‘hats’ - manager, copywriter, designer, business
strategist, etc.
Unfortunately, to set up all of the tracking options
above, you’d likely need to add developer to that
never-ending list.
That is, unless you use Madgicx’s Cloud Tracking
Service.
higher ROAS inside their dashboards, meaning
less money spent on inaccurate and outdated
data and more budget allocated to highly-
profitable campaigns and ad sets.
You can get started with Cloud Tracking
services by signing up through the Madgicx app.
Cloud Tracking also comes with a money-back
guarantee, meaning the only thing you have
to lose is data by not taking advantage of this
service. ;)

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CHAPTER 2: OPTIMIZING
YOUR FACEBOOK ADS
TARGETING

Now that we’ve got our tracking set up, and we can be sure we’re capturing all
the data we can, we’re ready to move on to the next step - analyzing the results
we currently have and optimizing them.

We’ll start first by analyzing and optimizing your Facebook ads targeting strategy.

Full-Funnel Targeting Optimization

First, we want to take a step back and look at our targeting strategy as a whole to
make sure we cover the entire sales funnel. One of the first things you might find
is that you don’t even have a Facebook funnel to analyze.

It’s easy to want to shoot straight to the point and go for a direct purchase

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campaign off the bat. After all, we all want to earn money from our Facebook ads
right away.

The truth of the matter is that people typically don’t buy from a company
they’ve never heard of straight out of the gate. Therefore, you need to create
an entire sales funnel that takes your audience from complete strangers to loyal
customers.

Each step of the funnel should have a different strategy, message, and goal.
Here’s an example of a traditional Facebook ad funnel:

The marketing funnel

Acquisition
Don’t know your brand
Prospecting

Acquisition Engaged but haven’t

Re-Engagement visited website

Retargeting Website visitors

People who purchased

Retention from you

The Acquisition Prospecting Acquisition Re-Engagement Retargeting is where the Retention builds upon the

stage is geared toward focuses on taking that new action starts to happen and is trust you’ve built with your

reaching new audiences and handshake to the next step all about finalizing the sale (or new customer and helps

introducing them to your by getting them to visit your getting leads). This is where them turn into repeat buyers.

brand. The targeting setup website. You would be using retargeting based on website You should be working with

here should be for cold engagement-based custom visitors comes into play. targeting current or previous

audiences who have never audiences here. customers in the retention

interacted with your brand phase.

before.

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It’s important that you have campaigns (and therefore, audiences) at every
stage of the funnel to create a self-sustaining cycle of evergreen leads for your
business.

How to Create a Facebook Ad Sales Funnel

If you found that your targeting strategy misses one (or more) of these audiences,
don’t worry. There’s no time like the present to fix it.

Here’s an overview of how to set up a Facebook ad sales funnel that converts.

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Prospecting
The first step of this funnel is the prospecting stage. For
this first step, we’re trying to find people who have never
heard of us before and showcasing info on who we are
and what problems we solve.

For audience targeting, we want to use lookalike

audiences, location-based audiences, and general
interest targeting tactics.

Video ads are particularly good for this step as they allow
you to retarget people who have watched them which
will help you for the next step of the funnel. Carousel ads
are a good option as well given the amount of virtual real
estate they offer, and work well for those who have more
traditional eCommerce goals.

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Re-Engagement

Working our way down the funnel, we then arrive at re-

engagement. We’ve warmed up our audiences by giving
them a friendly handshake in the first step, but now’s the
time to push the needle and get them to visit our website
or landing page.

At this stage, engagement-based custom audiences will

help us find the best people to target. Ideally, you’d use
the following types:

● Video engagements - People who have watched

videos from your campaigns
● Instant experience - People who have engaged with
your Instant Experience ads
● Shopping - People who have viewed or engaged
with your Facebook shop
● Facebook/Instagram page likes - Fans of our
Facebook/Instagram page

Sales and interactions are based on a foundation of trust.

So, those who have previously interacted with your brand
and had a positive outcome are more likely to take the
next step and consider purchasing than strangers.

**Special note** Make sure to exclude website visitors

from these campaigns to ensure we’re only targeting
those who have not visited our site yet.

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Retargeting

If we lived in a world where everyone who clicked on an

ad immediately purchased from us, there’d be no need
for guides like this. For those of us living in this plane of
existence, retargeting is the much-needed next step of the
funnel.

At this step, we want to target those who have visited our

website (or viewed our lead form, for lead gen advertisers)
but have not yet purchased (or become a lead) and
convince them to do just that.

ead form, for lead gen advertisers) but have not yet
purchased (or become a lead) and convince them to do
just that.

You can do this by creating a custom audience based on:

● Website visitors who have viewed your store

page (exclude those who purchased)
● Those who have viewed your lead form or
landing page (exclude those who have filled it
out)
● Using product catalog retargeting with Dynamic
Product Ads (again, excluding purchasers)
● People who added items to their cart (excluding
those who purchased)

Given that you’re trying to go for gold and make a sale,

you should be offering your best discounts and products.
Try combining free shipping, coupons, or even free items
with your ads to make the offer irresistible.

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Retention

The easiest customer to sell to is one who has already

purchased from you in the past—which is coincidentally
the next stage of the funnel.

In the retention stage, we can use the product purchase

information we already have from customers to cross-sell
or upsell relevant products or services that will add value
to their previous purchases.

For example, if a customer has just purchased a mobile

device from you, you can use these campaigns to
advertise a carrying case or other related accessories.

Here you can use:

● Email list custom audiences based on current

customers
● Website custom audiences of those who have
completed the purchase event
● Product catalog retargeting focused on those
who have already purchased

As for the best creative angle, the answer is pretty simple

for eCommerce advertisers - Dynamic Product Ads. By
combining the power of your product catalogs with their
retargeting abilities, Facebook can automatically suggest
relevant products for you instead of having to create a
specific campaign for every product you have.

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Audience Type Optimization
After you have your funnel up and running, you can then start analyzing and
optimizing each of the audiences you’ve set up. You can start by reviewing
the performance of the audience types you’re already using to get a general
baseline.

When you do this audit, remember to only analyze and optimize audience
types in the same stage of the funnel. For example, don’t compare the ROAS
of a prospecting audience to that of a retargeting one as they cover completely
different segments and goals.

Unfortunately, Facebook doesn’t make analyzing the audiences very simple or

intuitive. The best way I’ve found to view these audience types side by side is to
use naming conventions that reflect my audience types. You can then view this
data inside Ads Manager:

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Unfortunately, if you have different campaigns using the same audience type,
you’d need to combine their results together to accurately judge them against
the others.

If you have a Madgicx account, you can view the data on each of your audiences
from every campaign inside Targeting Insights.

You’ll also be able to see how much these audiences have spent, the ROAS,
Cost per Purchase, and Outbound CTR all in one place. If all that wasn’t enough,
you’ll be able to see performance trends over time in the Performance Overview
column.

Once you’re ready, you can then start creating different audience types to test
them against each other at each stage. Then you’re able to better scale your
campaigns based on those results.

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If you find that interest targeting is working better than lookalikes, for example,
then you could focus on those audiences and reduce or even pause the budget
of the other audience types to focus on what drives the best results.

Consider creating some of these tests when setting up your campaigns:

Prospecting

● Interest targeting vs. lookalike audiences

● Lookalike audience percentages (1%, 2%, 5%, 10%)

Re-engagement

● Video watchers vs. page fans

● Video watchers of specific view percentages (95% viewed vs. 75%
viewed, etc.)

Retargeting

● 30-day vs. 60-day website visitors

● Visitors who have shown higher intention (added items to their cart,
added payment info, etc.)

Retention

● Product catalog sets

● Upsell vs cross-sell targeting

Facebook doesn’t feature the ability to use pre-made audience templates, so

you’ll need to create these different audiences on your own.

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If you want to spare yourself hours of work (and headaches), Audience Launcher
features 100+ audience templates that you can use to create these segments in
just a few clicks.

After you’ve launched your tests, you can wait for the data to roll in and repeat
the process until you find the perfect funnel combination for your business.

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CHAPTER 3: OPTIMIZING
YOUR CAMPAIGN
SETTINGS

While targeting, tracking, and creatives are some of the most important things to
optimize, sometimes we can lose sight of what we might think of as smaller or
less important settings.

Some of these settings, however, can have the biggest impact on your
campaign’s performance and delivery—therefore, this section of the eBook is
dedicated to general campaign settings optimization tips.

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Budget Distribution Optimization
Part one of funnel creation is setting up the right environment to lead our
prospects down the path to becoming a customer. Likewise, you should also
ensure you’re budgeting the correct amount for every stage to make sure your
flowing funnel doesn’t turn into a leaky faucet.

Unfortunately, there’s no easy way to identify your percentage of spend by funnel

stage in Ads Manager as there’s no ‘funnel stage’ breakdown. The best way to
analyze how much you’re currently spending across your funnel stages is to:

1. Identify and manually tag each campaign by sales funnel stage.

2. Add up the total amount of money spent in each stage.
3. Calculate the percentage of your total monthly budget that each stage
takes up.

You can add a tag to any campaign by clicking the checkbox next to the
campaign name inside Ads Manager and selecting the tag icon in order to sort
your campaigns.

The rest, unfortunately, is manual spreadsheet math.

If you have a Madgicx account, however, we’ll show you a breakdown of your top
KPIs by funnel stage in the Facebook Dashboard.

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Since you now know how much you’re spending across the funnel stages, you
can review your spend percentages to see if they match our guidelines. Our
recommendation for budgeting the funnel stages is:

● 70-80% Acquisition (Prospecting + Re-Engagement)

● 15-20% Retargeting
● 5-10% Retention

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If you’re a visual learner, here’s a quick illustration of the stages and their
respective budget.

Budget allocation across the funnel

Acquisition
60% Don’t know your brand
Prospecting

Acquisition Engaged but haven’t

20% visited website
Re-Engagement

Retargeting 15% Website visitors

People who purchased

Retention 5% from you

If your campaign goals are focused on getting leads (think real estate, B2B sales
motions, etc.), the retention phase doesn’t really apply, unless you have a partner
affiliate program to use. Instead, you can re-invest this budget allotment evenly
back into the retargeting and acquisition section of the funnel. Just note that
retargeting doesn’t get more than 20% of the total budget.

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Campaign Objective
Optimization
Each campaign should have a clear, action-
oriented goal in mind before you ever hit the
publish button. The campaign objective is your
way of giving Facebook that information so they,
in turn, can direct their algorithm to find people
who are more likely to take that action.

Each campaign objective has different settings

available (placements, ad formats, and
optimization for ad delivery) that are geared
towards getting you that end result you’re looking
for. Therefore, in order to optimize for the right
objective, you need to make sure your campaign
objective aligns with the goal of the campaign.

There are currently 11 different campaign

objectives on Facebook. However, Facebook is
making changes at the moment to whittle this
number down to just 6. These 6 are:

1. Awareness 4. Leads
2. Traffic 5. App Promotion
3. Engagement 6. Sales

For most e-commerce goals, your main choice

here should always be Conversions, which is now
called ‘Sales’. However, as with all things, the main
thing we want to do here is to test and see which
objectives give us the best results. you can do this one of two ways. First, you can go
to Ads Manager and customize your default view
If you want to view this information on Facebook, to add Objective into the columns.

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After you do this, there’s still some manual work to be done. Once you have the
Objective column you can add up the performance data of all the campaigns
with that specific objective and compare them against each other to see which
performed best.

Those with Madgicx accounts will have a much easier job by viewing the
Campaign Objective chart inside Auction Insights.

Here, we can quickly see a breakdown of all our campaign objectives, as well as
how much we’ve spent on each and their ROAS.

After analyzing your data, you can then use your best-performing objectives for
your next campaigns.

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Campaign Budget Optimization (CBO) vs. Ad-Set Budget
Optimization (ABO)
There’s only one thing more divisive than the age-old Star Trek vs. Star Wars
debate—and that’s whether to use Campaign Budget Optimization or Ad-Set
Budget Optimization.

The main difference between the two lies in how the campaign budget is split
among its ad sets.

With Campaign Budget Optimization (or CBO for short), the budget is set at the
campaign level. Facebook’s algorithm then optimizes the budget automatically to
split it between the campaign’s ad sets (based on performance).

Ad-Set Budget Optimization (ABO) takes the opposite approach. With this
approach, the budget is set for the ad sets individually, and the optimization of
the budget happens on the ad level.

While the technical difference is ‘small,’ there are several pros and cons to each
approach. So much so that we created an entire chart for it. ;)

ABO
Older and more stable: ABO is the older
Budgets technology and therefore still
tends to perform better in many accounts.
Flexible: You can pause ad sets or launch
Strengths new ad sets into existing ABO campaign
without disturbing the entire campaign.
More control: You can control budgets
for individual target audiences/ad sets
directly
CBO
Lower maintenance: Facebook’s
algorithms will distribute budgets and shift
them into the best-performing ad sets.
Favored by Facebook algorithms: CBO
is recommended by Facebook as part of
thair Power5 agenda.

Higher maintenance: ABO requires more
work and focus from your side to control
and optimize the budgets.
Might encourage users to run too many
ad sets.
Weaknesses
Values audience size over performance:
distribute budgets into the audience with
the biggest audience size and not
necessarily the best-performing audience.
More fragile: Pausing ad sets can disrupt
the momentum of the entire campaign.
Not recommended for new ad sets:
that’s because the majority of budgets
tend to go into a smaller fraction of the
ad sets, and CBO might take longer
before starting to drive results.

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As with everything else, this is something you’d want to test yourself before you
decide which you want to go with.

The easiest way to analyze this on Facebook is going to be our old friend Tags.
Just like with the other analytics, you’ll need to tag each campaign with ABO/
CBO, add up your results, and go from there.

And just like everything else, Madgicx has this information built into our
dashboards already inside Auction Insights under Campaign Type and Budget.

From here, we’ll split your ABO and CBO campaigns and their respective data
side by side. You can also refine your results further and dive deep into ROAS, ad
spend, and outbound CTR. This will allow you to really understand if CBO or ABO
performs better for you.

Our recommendation for this optimization is actually to use a combination of

both, depending on where you are with your campaign status. ABO is best for
testing out new ad sets or audiences. We at Madgicx typically use this strategy
for our experimental campaigns where we’re testing different audiences.

After we’ve picked out the winning strategy by using ABO, we then use CBO to
scale our winning audiences. Moreover, we recommend using CBO mostly in
acquisition prospecting campaigns.

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However, if you see that CBO performs better for you in any other funnel stage
- or for test campaigns - leverage that. Everything depends on your results, and
every ad account is different. We have our recommendations, but you should try
them for yourself.

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Bid Strategy Optimization
If you need to catch the train during rush
hour, you know there are only so many who
can cram in the small space before the train
leaves the station and the stragglers are left
behind.

This is similarly true for the Facebook ads

auction. During the ad auction, Facebook
ranks advertisers on a myriad of things,
including;

● Your ad relevance. Facebook uses its

ad relevance statistics to calculate how
relevant your ads are to your target
audience.
● Estimated action rates. Facebook
also wants to make sure your target
audience is likely to take your desired The first step to optimizing your bid is to
action (purchase, click, etc.). review what your goals for that campaign
● Bid. Much like a train, Facebook is actually are. If you’re following our Facebook
also a pay-to-ride system. In this case, ad funnel, this will change from campaign to
Facebook judges how much you’re campaign.
bidding compared to what other
From there, you can then choose from
advertisers are paying for the same bid,
Facebook’s bidding strategies depending on
as well as what prices you typically pay
the stage they’re in.
for such actions.

Overall there are three different types of

The most important thing to remember here
is that the correct bid amount and strategy
are critical to your success. If your bid is too
low, you’re likely to see restricted delivery or
worse—no impressions on your ad at all.
bidding categories, each with its own unique
strategy—spend-based bidding, goal-based
bidding, and manual bidding.

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Spend-based bidding focuses on spending
your entire ad budget to get the most results
possible. This includes the highest volume
and highest value bid strategies.
● Highest volume aims to give you the
most conversions at the cheapest cost
and is the default bid strategy for ad
campaigns. This is useful for top-of-the-
funnel campaigns (prospecting) where
the goal is to reach as many people as
possible.
● Highest value is designed to get the
maximum value from a conversion. This
means Facebook will try to go after
people who would likely result in driving
more revenue for your campaign. Since
it’s revenue-focused, this would work
well for the re-engagement, retargeting,
and retention steps.
Goal-based bidding, on the other hand, is
for those who need to stick to a strict budget
and who are very aware of their current
costs.
● Cost per result goal lets you set the
desired CPA you want to maintain
for as long as possible. This makes it
perfect for lead gen advertisers at the
retargeting stage that need to keep a
flat cost per lead.
● ROAS goal bidding is used to ensure a
minimum return on your overall budget.
If you’re selling products with a low
price point and need to ensure a bare
minimum return, this is a great bidding
method for the re-engagement, re-
targeting, and retention phase.
Manual bidding is for seasoned Facebook
ad veterans who have hard data on their
costs and want the most control possible
over their bids.
● Bid cap is similar to cost cap, albeit
more strict. Here, you set the maximum
amount you want to pay for each auction
without going over it. You can use this at
any stage of the funnel, but ensure you
have accurate data on your costs before
you do.
Here’s a handy chart you can save that has a
quick explanation of them all:
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If you’re already using different bid strategies for your campaigns, that’s great
news! However, you should always be analyzing and optimizing your bidding
strategies by comparing them together.

In order to analyze your bid strategy performance, you can view them together
by using the bidding and optimization view inside Ads Manager.

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In this case, you’d need to create multiple ad sets and campaigns to view their
performance together.

For Madgicx customers, you can set up a bidding experiment by duplicating your
winning ad sets in just a few clicks.

You can then view your bidding performance experiment results inside the
Auction Insights under Automatic vs Manual Bid.

33
If you find that your bidding needs a little work and your results are lackluster,
there are a few things that you can do to optimize it:

● Make sure your ad is of good quality

● Ensure your ads are relevant to their target audience
● Spend more than the bare minimum bid

If you still can’t seem to make it work with the strategies you’re trying now, test
multiple bidding strategies and varying amounts to see what works.

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Ad Placement Optimization
Chances are if you’re asked where you’d want your ads to appear on Facebook,
you’d proudly proclaim “Absolutely everywhere!” However, your wallet may be a
little less likely to take that leap.

Instead, we can pick and choose where our ads will be shown on Facebook—
leading us to the ad placement optimization dilemma.

There are currently over 19 different ad placements across Facebook, Instagram,

and the Audience Network. Each of these placements has a different cost, ad
format, and typically, ROAS. When you create your campaign, you can choose
to have Facebook automatically select the best placements for you, or you can
select your own.

Unfortunately, the only way to figure out which placements are best for you is to
do what scientists do best and experiment.

Once you have campaign data and have been using a variety of placements, you
can view the results inside Ads Manager to determine which placement is giving
you the best ROAS to optimize performance.

35
Of course, Facebook (again) makes this difficult. In order to view
these stats, you need to go to the ad or ad set level and then select
Breakdown>Delivery>Placement inside Ads Manager

You then need to customize the columns to add ROAS. Since Facebook won’t
group these all together for us, you’d need to add up all of the placement results
together and calculate your own ROAS per placement type manually.

36
Madgicx customers have it way easier thanks to Auction Insights. This tool
will collect all the placement data on your account and show you how each
placement performs and which truly moves the needle.

After you’ve determined which placements are giving you the best results, you
can continue to use the top performers in your future campaigns and focus on
testing things like ad copy and creatives.

37
CHAPTER 4: OPTIMIZING
BUDGET WITH
LOSS-PREVENTION
AUTOMATION

Retail stores have one thing that Facebook advertisers wish they had—a loss
prevention department.

While we can’t send a team of tiny security guards into the Facebook platform
to do our bidding, there are some ways we can prevent serious loss of revenue
during our tumultuous testing phases. We do this by using Facebook’s automated
rules.

Rules are a simple tool we can use to say “If X happens, then do Y.” You can find
them by clicking on the Rules button inside Ads Manager.

38
With rules, we can make sure to set specific hard caps on the spent budget and
automate actions so we’re not constantly staring at Ads Manager every second
of the day.

Today, we’ll cover our top three examples of optimizing your budget with
automation.

Permanent Stop Loss for Underperforming Ads.

When testing new audiences and creatives, you’re taking a risk that what you’re
doing can cause you to lose money. This can happen quickly and means that you
need to be vigilant.

Therefore, it’s good to have a rule set up that prevents you from spending too
much without any results.

To combat this, we want to create some rules that pause our ad sets when they
go below our typical ROAS.

39
Our rule setup should be based on these factors:

● Hours since creation greater than 72 (to give our ads some time to perform)
● The amount spent in the last 7 days is greater than or equal to 1.2x the
account’s average CPP in the last 7 days (to allow enough spend to drive
results)
● ROAS in the last 7 days is lower than 0.5x the average account ROAS in the
last 7 days

We recommend setting up these same rules at the ad-set level to cover targeting
experiments and at the ad level to pause unprofitable creative experiments.

Unfortunately, this setup is not possible to replicate inside Ad Manager as you’d

need to use a tool that can set up these advanced rules for you: like Madgicx.

For Madgicx customers, this feature lies inside the Advanced Automation
Strategies and will already take your averages into consideration, so you won’t
have to do any math when setting them up.

40
Temporary Stop Loss for Ads
That Don’t Drive Clicks
Another thing to pay attention to when testing
your ads is your clicks, as it can take some of
the biggest nosedives, particularly when testing
your creative elements.

To combat that, we’d also like to create a

temporary stop loss for ads that don’t drive
clicks.

This rule is a bit more simple than our last: our

only goal here is to pause ads that have cost
us more than $10/click. Of course, you can set
a lower or higher amount, depending on your
average CPC.

Given that this rule is based on clicks (and

not Pixel data) it won’t be affected by iOS 14
changes, and thus won’t have any issues with
data that isn’t tracked.

Ideally, we’d like this rule to only run for today,

and then turn our campaign back on tomorrow.
After all, if the ad has only spent $10, there’s a
chance that it could still perform well but it just
needs some time to do so.

However, with Facebook rules, there’s no way

to set the rule to turn off and turn your ads on
again at midnight, so you’d need to use a tool
like Madgicx that has this ability built in.

41
Revive Ads You Turned Off Due
to Delayed Attribution
Given all we learned earlier about iOS14 and its
changes, it may come as no surprise that some
conversions can be attributed to ad sets at a
later date.

For this issue, we actually want to create

a rule to turn on ad sets that had been
previously paused due to what we thought was
underperformance at the time.

The conditions will be ROAS in the last 7 days

greater than 1.5x the average account ROAS in
the last 7 days. The spend for the previous day
should also be set to 0.

42
Sometimes you might want to pause ad sets
and ads and keep them paused even if the
performance looks great. Perhaps it’s because
you ran a limited-time offer or your products are
sold out.

In this case, you can make sure the automation

only applies to ad sets that do not have
“PAUSED” in their name. Just remember to
add “Paused” to the ad set name when you
want to keep it paused no matter what, and the
automation won’t regard it.

43
These three rules are just a small sprinkling of things you should be adding to
your ruleset and, in our opinion, are the bare minimum.

Inside Madgicx, we have created an entire rule-based template for every possible
situation you may find yourself in with Automation Tactics.

Within this powerhouse lies a rule for every situation. You’ll find rules for
frequency limits, pausing losing ads for the day (like we did before) and even
ones to help you scale your ads/ad sets that are performing better than normal.

If all that wasn’t enough, Custom Automation Tactics also gives you complete
control over every aspect of our rule system, meaning you can create
sophisticated automated rules for any situation and metric.

44
CHAPTER 5: OPTIMIZING
YOUR FACEBOOK AD
CREATIVES

Now, we’ve come to the most fun you can have with Facebook ads (aside from
rolling in all the money you’ll have earned by following this guide)—optimizing the
creative side of your ads.

45
Ad Format Optimization
Before we even go into copy and design, we need to focus on what sort of ad
type we want to use for our campaigns in the first place.

As with all things we’ve seen here today, the type of ad you use can vary widely
depending on what the goal of your campaign is and what stage of the funnel
you’re at.

That being said, you can easily use a video campaign in both a prospecting and a
retargeting campaign as long as the content is personalized for each goal, so feel
free to get creative with what you use.

There are five general ad formats available on Facebook:

Image - an ad with a single image

● Video - an ad with a video

● Carousel - a swipeable ad that features multiple images
● Instant Experience - a full-screen experience for mobile devices
● Collection - Multiple product callout images that open into an Instant
Experience

The best way to see which format works is to simply test them on your own and
see which gives you the best results. One way to do so is to test them against
each other using the A/B testing available inside Facebook and then view results
under the Experiment tab.

46
This would need to be repeated for every ad format you’d like to test across your
account. Just like before, you’d need to collect all the data across all of your tests
and compare them together to find the winners.

Inside Madgicx, you can find this data inside without having to set up split tests in
the first place.

47
In the Creative Insights dashboard, you’ll find a list of ad formats used in your
account, as well as data on your most important KPIs so you can see your results
right next to your spend.

Once you’ve tested your formats, all you need to do to optimize this part of your
strategy is focus on your top-performing formats in future campaigns.

Messaging Optimization
When I read online articles about optimization, I typically see the design element
at the top of the list. While the design of an ad is typically the part that grabs your
eye, the messaging is what inspires us all to take the opportunity that’s in front of
us at the end of the day.

Messaging to us refers to the overall tone of your ad, not just the words you use.
It looks at how you speak to your audience and the overall feeling the graphics
and copy convey.

While creating messaging is its own skill, there are a few tried-and-tested best
practices that you should always follow when creating high-converting copy:

Know your audience before you write. Take a step back and put yourself in the
mind of your prospective buyer and write with words and terms they use.

Use emotion to drive action. We’re emotional creatures at heart, and emotions
can be used to sway your audience into taking that next step. You can use FOMO
(the fear of missing out) to urge your audience to take action soon or speak
about their problem with empathy and endear them to your brand.

Test often and think differently. While we always recommend split testing,
oftentimes, we see split tests in copy that change only one word of the sentence.
Instead, think about testing two completely different approaches. For example,
you might want to test several of the benefits of your product against each other
to see which intrigues your audience the most.

48
For this optimization, we can set it up exactly as we did before by running an A/B
test on Facebook and viewing the results on the Experiments tab. Again, we’re
limited by having to manually process this information ourselves for the next
tests.

Madgicx users are a bit luckier in that they have the power of AI backing their
copywriting skills 24/7 and can find a breakdown of their copy under Ad Copy
Insights.

Here, we’ll give you a complete breakdown of everything copy—including length,

which emoji to use, and even which copy works best for each of your audience
segments.

By using these features, you can pinpoint what to say at each stage of the funnel
to drive your audience one step closer to your goals.

49
Design Optimization
Last, but not least in any regard, comes design optimization. While you can
technically argue that copy is design, we’re specifically talking about the graphic
elements of your ad.

Just like with messaging, the design can help to further expand upon the tone
and impression we want to convey. Therefore, it’s important to create an array of
different designs to see which works best.

Just like for messaging, there are a few basic rules to follow when designing your
ads:

Design with your end goal in mind. If the goal of the ad is to purchase a specific
product, don’t create an image that promotes another product or offer in the
process.

Don’t create a wall of text. The fewer words you can use in your image to
convey a point, the better. Images with too much text are typically hard to read
(especially if you’re targeting older audiences). In fact, Facebook used to penalize
images with an image composed of more than 20% text.

Keep on brand. If you take a moment to think about it, you can pretty easily
remember the features of your favorite brand. You might remember the colors,
logos, how the font looked, etc. So wouldn’t it be strange to see a different
version of those items constantly rotating? Try to stick to your brand’s general
color palette and overall design themes when creating ads.

If you’re not a creative person by nature, don’t fret. There’s always a little
inspiration that you can find for free in the Facebook Ad Library.

The Ad Library is a searchable index of all the currently running ads across
every Facebook placement, including Instagram and Audience Network, and is
available for free to everyone.

50
The Ad Library is a searchable index of all the currently running ads across
every Facebook placement, including Instagram and Audience Network, and is
available for free to everyone.

With this tool, you can easily research your competitors or other brands in
the industry to get a bird’s-eye view of what is trending. This not only works
for analyzing the design, but you can also use it to view popular formats and
messaging options.

If that isn’t enough or you still can’t seem to think of anything, you can always try
reviewing your most popular organic posts and turning them into ads too.

After you’ve created your ads, you can then optimize them. Before you even
ask, yes, we yet again have to go back to the same methods as the previous two
parts of ads and use the old Experiments view.

And yes, Madgicx has yet another tool to solve this ugly pain point - Madgicx
Creative Insights.

Creative Insights analyzes your own ad elements with AI-based object

recognition to identify the specific points that give you the best results at the
lowest price.

51
You’re more than welcome to continue sticking with Facebook’s age-old data
viewpoints, or, you can sign up to use Madgicx during a 7-day free trial and get
access to this and all of the other features we mentioned today for $0 ;)

52
CONCLUSION

We’ve covered a LOT of ground today with Facebook ad optimization strategies,

and our team is happy that you’ve decided to take the time to learn from us and
improve your results in the process.

These strategies do take time and effort to implement, that’s true. But the harsh
reality is that clicking ‘publish’ on your campaign is only one small step in your
overall Facebook ads journey.

The real reward from your advertising may come at the cost of late nights and
early mornings, but watching your company’s revenue take flight after barely
breaking even is one of the best feelings in the world.

But that’s just the opinion of some intensely dedicated Facebook ad nerds. :)

53
 The Ultimate Facebook Ad Optimization Checklist

Step 1. Optimize Your Tracking

▢ Install the Facebook Ad Pixel

▢ Use Offline Conversions
▢ Integrate server-to-server tracking

Step 2. Optimize Your Facebook Ads Targeting

▢ Make sure to cover your entire sales funnel

▢ Test different audience types at every funnel stage

Step 3. Optimize Your Facebook Ad Settings

▢ Ensure your budget is distributed correctly across the funnel

▢ Use the campaign objective that drives the best results for you
▢ Create split tests using ABO and CBO to find which works best for you
▢ Test and optimize your ad placement and bd strategy

Step 4. Optimize Your Budget With Automated Rules

▢ Prevent loss for under-performing ad sets

▢ Prevent loss for ads that don’t generate clicks
▢ Reactivate ad sets turned off due to delayed attribution

Step 5. Optimize your Facebook Ad Creatives

▢ Test different Facebook ad formats

▢ Craft different messaging based on pain points and offers
▢ Experiment with different ad designs

54
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