7 Tips to Reduce Customer Acquisition Costs for Facebook Ads

Customer acquisition requires a solid understanding of the audience and the ability to adapt to change.

Customer acquisition cost (CAC) is the cost of moving a user down the sales funnel to the intention stage before they actually make a purchase. Customer acquisition cost is the cost of doing this.

This cost is calculated by dividing all expenses for customer acquisition (marketing and advertising) by the number of new customers acquired. If you spend $50 per year on advertising and acquire 50 customers, your CAC is $1.

Facebook is an ideal source of customer acquisition

There are many reasons why Facebook is a great place for eCommerce brands to attract new customers:

●Advanced targeting can help you place your ads to the audience most likely to buy;

●Creative advertising allows you to display your ads in a unique and eye-catching way;

●In-depth metrics enable you to measure ad performance and adjust your strategy accordingly.

So, how can we effectively acquire customers through Facebook?

1. Redefine your target audience

Define basic information like demographics, but also define what is a “new user.” Some companies define a new customer as one who has never purchased, while others define it as one who has not purchased in the past year. Look at your own customer base and determine which definition makes sense based on your customers' buying habits.

2. Build better lookalike audiences and use a layered approach

Lookalike targeting refers to targeting a new group of potential customers because they are similar to your core target customer group.

The success of this strategy depends on the quality of your “seed list,” which is the collection of emails of people with high purchasing intent. Seed lists can be extracted from email snippets or website interactions. You want to maintain a 1% lookalike audience size for maximum relevance.

3. Activate your creativity

Short animated videos can do a lot to draw attention to your ad and increase engagement. These videos don’t need to be intensive to produce, even a slideshow video or animated GIFs can help your ad stand out among the static ads most people post.

Keep in mind that many users won’t turn on audio, so be sure to include subtitles in your video to get your message across to this audience.

4. Make full use of media

Make sure your ad takes up the entire device screen to ensure users fully pay attention to your message. Additionally, make sure your brand is prominent and recognizable so that your audience isn’t confused about who you are and what you’re trying to say.

5. Conduct variable testing

Most users have 2-6 active Facebook ads at any given time. If you haven't tested it, this is a good number.

However, if you want to do any kind of testing with your ads, you’re better off running only 2-3 ads. You can change just one element of each ad and measure the performance difference between the old and new versions.

This single variable is critical because it allows you to focus on making adjustments that will benefit your ad performance. Over time, you'll continue to test and improve, and eventually get lots of incremental improvements.

6. Use dynamic ads to develop potential customers

Dynamic product ads for a broad audience aren’t as flashy as other types of ads on Facebook, but they’re just as effective at attracting new customers. They use user intent signals to determine who saw the ad. Tinuiti saw brands achieve a 24% increase in average CPA and a 76% increase in return on ad spend (ROAS) on average.

Dynamic product ads don’t have to rely solely on static images. Following the advice above, you can add overlays to these creative assets to add movement and life to an otherwise bland ad. Introducing new incentives or discounts will also help increase click-through rates.

7. Monitor Ad Frequency

Facebook favors advertisers that have a strong and ongoing presence on the platform. When advertising on Facebook, you need to pay attention to the frequency of advertising. Brands need to ensure that their ads are shown frequently to enhance people's impressions. If you can do it, 1.5 to 2 times a week is recommended.

Customer acquisition costs are easy to calculate, understand, and improve. If you follow the principles of using dynamics in your ads, tight and accurate targeting, and continually testing and improving your ads, then you’ll quickly get the hang of keeping your customer acquisition costs under control.

Author: Traffic FB

Source: Traffic FB