-Increase conversion rate, increase average order value + customer retention-
Are you an ecommerce business looking to run a successful FB ads campaign? If so, there are three critical elements you must have in place first: a good website conversion rate, high enough average order value and high enough lifetime value of a customer.
We recommend not running FB ads until you have a website conversion rate above 1%. Why? Because this number tells you how effective your website is at converting customers. When it's below 1%, it is very difficult to run a profitable FB ads campaign. If your conversion rate is low, it won't matter how much qualified, ready-to-buy traffic we send to your site via FB ads, because few of those people will actually convert. This means you simply won't make as much money as you could. A low conversion rate can negate an otherwise amazing campaign and can leave you stuck and profitless. Again, this is why it’s imperative that you work on your website conversion rate before launching a successful Facebook ad campaign.
Average order value (AOV) and lifetime value (LTV) of a customer are also important to know. These numbers will tell you how much you can reasonably spend to acquire a new customer, along with helping you project how much value a customer will bring you in the long-term. The higher these numbers are, the better off you'll be and the higher chance that you'll be able to make even more money with a FB ads campaign. Typically, the more you can reasonably spend to acquire a new customer via FB ads, the higher ROI you'll find.
You may be thinking to yourself, well that all sounds great, but how do I increase AOV and LTV? The best ways you can increase these metrics are having a desirable product that often requires repurchasing, utilizing customer retention tactics, and offering bulk discounts. When you focus on improving upon every aspect of your business, you will find much more flexibility and success when acquiring new customers and scaling your business to greater heights.
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