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6 Tips to Drastically Increase ROAS on Facebook and YouTube

By David Faith on Dec 9, 2021

One of the most important aspects of any marketing campaign is Return on Ad Spend (ROAS). ROAS is a metric that tells you the amount of revenue generated per dollar spent on advertising. Nobody wants to waste their money.

Facebook and YouTube are two of the biggest social media channels globally with 2.91 billion and 2.24 billion active users respectively. So today we would like to look at how to increase ROAS on these platforms.

Of course, some rules remain the same across pretty much all advertising. For example, you want to test elements of your ad before you commit to a large, extended campaign. These elements may include the creative, the headings, the body copy, the CTA and placements. And of course, no advertising is going to be effective if you don’t target the right audience with the right message.

You can reach out to a Facebook marketing agency or social media marketing agency to help if this isn’t in your core wheelhouse.

But let’s get into more specifics.

Understanding ROAS: Facebook vs. YouTube

Some ads are a lot easier to measure than others. Brand awareness campaigns can go a long way to help your business in the long run, but they are a lot harder to measure than a campaign aimed at making immediate sales. Brand awareness campaigns are better measured by website traffic or impressions rather than trying to determine a dollar ROAS

But for those ads that lend themselves to measuring ROAS, let’s get into how to do it on Facebook and YouTube.

The formula for ROAS is the revenue from ads divided by the cost of ads. Pretty simple. So, for example, if you spend $100 on ads and generate $150 in revenue from sales then your ROAS is 1.5:1.

According to a Databox survey, the average ROAS for Facebook ads is 4 to 5 times, or in other words, 4 to 5 dollars in revenue for every dollar spent on Facebook ads. Most marketers consider 4:1 as a good ROAS for YouTube ads as well.

Facebook vs. YouTube: How to Make the Most ROAS

Facebook and YouTube are tools for advertising your business. Here are some tips for you to make the most ROAS on these social media marketing platforms:

1. Focus on Retargeting

We all know that retargeting is great, but you might not understand the true extent of its rewards for Facebook and YouTube ads. The average click-through rate for display ads is 0.07%, while it’s 0.7% for retargeted ads. That’s  a 900% increase in click-through rate!

Not surprisingly, this leap in click-through late is accompanies by a leap in conversions from your display ads. The average is about 70%.

Now, I’m sure it’s not news that Facebook, Google, Firefox and Safari have started to restrict third party cookieswith more to come. These platforms will allow users to choose whether they want to be tracked across websites. That makes it harder for businesses to get the information they need for retargeting, but the cookies haven’t gone completely.

First party cookies are still available on Facebook and YouTube. You can use them to target specific demographics and retarget users who’ve visited your Facebook page or YouTube channel. The first-party data you get from your website visitors is also available to you for retargeting purposes.

2. Test and Select the Best Ad Format

YouTube and Facebook have various ad placement options Choose which you use according to your goal. For YouTube, these options include bumper ads, sponsored cards, display ads, skippable video ads and non-skippable video ads. For Facebook, the placement options include feed ads, Facebook right column ads and Facebook search results to name a few.

Testing ad formats to see which works best with your audience is one of the best ways to increase ROAS. This is an integral part of social media advertising. You should use  data from testing to see which formats made the most sales and then double down on them to increase your ROAS for Facebook and YouTube ads.

3. Improve Ad Copy and Increase Your Average Order Value

If you are interested in your ROAS (and who isn’t), of course you will always want to write  compelling ad copy that touches on your audience’s key pain points.. You will want to include a strong call to action (CTA) to persuade the viewers to click on the Facebook or YouTube ad. If you also increase the Average Order Value (AOV) by advertising high-end products that can further increase the ROAS.

That way, your cost for Facebook or YouTube ads will remain the same but you’ll be able to earn higher revenue with each conversion. You can also add upsell offers on the landing page for your Facebook or YouTube ads to increase the AOV of each customer.

4. Personalize Your Ads and Target Specific Demographics

Target your ads as much as possible. Create ads that address your audience’s needs and wants. For example, if you’re targeting 20-350-year-old women and you run a luxury shoe store, then your ad copy could say something like planning for your wedding day and can’t find that perfect pair? Then advertise your collection of wedding heels.

If you can make your ad speak directly to your audience, you can increase engagement and conversion. 58% of customers say that personalized ads play a critical role in their decision-making process. Video ads are excellent for creating personalized ad campaigns.

You can personalize ads on both Facebook and YouTube and then increase conversions by showing them to specific users.

  • On Facebook, you can select your core audiences by choosing location, behaviors and interests on top of age and gender data among other choices. Facebook offers huge choices on demographic targeting and can automatically show ads to different audiences that might be interested in your business. If you don’t know how to usethis feature, then a Facebook marketing agency can help you out.
  • On YouTube, however, you can only select a few features of your target demographic such as age, gender, household income and so on. You also don’t have the Facebook’s options of custom audiences or lookalike audiences on YouTube.

Bonus Tips to Improve ROAS

Here are two additional tips that are specific to Facebook and YouTube:

1. Facebook: Improve Your Facebook Page Feedback Score

Facebook collects feedback from your users who shop on Facebook stores. An improved score of your Facebook business page feedback tells Facebook that you’re offering a great customer experience. That can mean fewer ad delivery restrictions and ultimately more ad reach to different audiences for the same budget.

Thus, you can improve your ROAS by improving your service quality and gathering positive feedback. Here are some best practices to improve a Facebook business page feedback score:

  1. Be clear about delivery times, product pricing and product quality.
  2. Offer great customer service.
  3. Streamline the checkout process.
  4. Use quality pictures to show accurate product colors..
  5. Advertise products that are currently available in stock.

2. YouTube: Leverage Interactive Elements in YouTube Ads

Interactive elements on YouTube ads include cards (show a product ad within a video) and YouTube end screens. You can add links to your product pages here to drive traffic to your online stores, increase app downloads and increase sales. These YouTube interactive elements are also helpful to increase ROAS.

A compelling CTA, image and title can further increase clicks and sales from your YouTube ads.

An important thing to point out is that this interactive feature is not available to all advertisers, so check to see if it is available according to yourbusiness and location.

Apply These Tips to Increase Your ROAS

Improving your ROAS can have a major impact on your business. Facebook is not better for advertising than YouTube or vice versa. Both of these are great platforms that offer various options to improve your ROAS.

If you’re struggling to increase revenue from ads, then you may want to contact Umbrella Local. We are a social media marketing agency that makes improving your ROAS a priority. Connect with Umbrella Local if you want to leverage ads to significantly increase your revenue.

Metadescription:  Increase the ROAS of your YouTube and Facebook ads with these tips. A Facebook marketing agency can also help.

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