Metatest profit optimization…
In a recent announcement about the new conversion tool, Meta shares a new test value optimization option.
Function
This function is based on this situation:
If advertisers care about ROA based on profit margin [now testing]
Typically, when you optimize value, META focuses on generating the highest returns on advertising spending.
But that return is based on product value, not profit margins. You can use $50 advertising spend to sell $100 products, but that doesn’t mean you make $50 profit. There are other business costs.
Meta provides this example:
Some products sell more profitably than others, and for some advertisers, the bottom line of selling a $20 product may be better than a $30 product.
How it works
Advertisers in this test can use the conversion API to send profit information. They can then “focus on driving ROA on the profits rather than the scale of purchases.”
Again, this is just a test, but this can be a very useful option.
Are you part of this test? If this option is given, would you use it?
