🦠Grow Your Business Organically and with Paid Ads🦠

When Showing Ads, Balance Two Things For 2019:

 

  • Creating value for advertisers by helping them reach and get results from people in their target audiences
  • Providing positive, relevant experiences for people using Facebook, Google an Instagram

 

Maximizing Advertiser Value / Optimizing Consumer Experience

 

The best way for us to do this is through Google ads or Facebook ads auction in which both interests are represented. That way, advertisers are reaching people receptive to their ads and users are seeing something they're interested in.

Our goal is to match the right ad to the right person at the right time.

 

This is different than a traditional auction because the winner isn't the ad with the highest monetary bid, but the ad that creates the most total value. All ads on Facebook compete against each other in this process, and the ads that our system determines will create the most total value will win the auction.

 

Generally speaking, the end result is that the more relevant we predict an ad will be to a person, the less it should cost for you, the advertiser, to show your ad to that person.

 

The delivery system consists of three components:

 

When there’s an opportunity to show someone an ad, advertisers compete for this opportunity. To find the most relevant experience, we rank each ad targeting a person. The winning ad maximizes value for both the advertiser and the person being advertised too.

Similarly, we may increase how much budget we spend if there's an opportunity to get many optimization events with costs aligned with your bid strategy. We may also decrease how much budget we spend if there are few available optimization events with costs aligned with your bid strategy.

 

These are the advertiser inputs that guide FB's auction and pacing systems.

 

These inputs include values and parameters you specify for your audience, budget, bid, placements, schedule, and optimization event (The number of times your ads achieved the outcome your ad set is currently optimized for, based on your chosen conversion window).

 

Thousands of advertisers want to show ads to people like you the moment you start looking at your News Feed – that is, example( people who are female, 25, who live in Washington, and so on.)

 

Facebook holds auctions that take into account each of these advertisers’ bids for an opportunity to serve an ad impression to someone like you. FB also considers how interesting and relevant we think you will find each of these advertisers’ ads, and how likely you would take an action such as clicking or making a purchase after seeing the ad.

 

Based on all of these considerations, Facebook determines which advertiser will win this auction.

 

A similar process happens each time a person on Facebook sees an ad. The ad auction works the same way for ads shown on Instagram, Messenger, and Audience Network.

 

Whenever there is an opportunity to show a person an ad, FB will run an auction to determine how to deliver the most value to him or her (and to you, the advertiser).

 

Maximizing user value

When your ad enters the Facebook ad auction, it competes with other ads in the auction aimed at people in your target audience.

 

As with all content on Facebook, Instagram, Messenger, and Audience Network, FB wants to make sure we're showing the right content to the right person at the right time — and this includes ads. FB aims to optimize the user experience by showing each person content that we think they'll find interesting and helpful.

 

Because FB also limits the number of ads people see in their Feed, you'll be competing against other advertisers for a limited number of slots. All the while, FB strives to show your ads to the people FB believes will be most valuable to you.

 

The FB auction ranks each eligible ad by its Total Value, and the ad with the highest Total Value will win the auction.

Total Value is a numeric value calculated using several factors, including the bid you submitted when you set up your ad, FB predictions about how the people in your audience will react to your ad, and how relevant we think they'll find your ad.

 

User value takes into account relevance and ad quality. The more relevant your ad is to your audience, the more likely it will be more competitive in ad auctions as well as perform better.

 

Note: Facebook uses user value, not relevance score in calculating Total Value.

 

Formula 

 

This is an overview of the formula FB uses to determine which ad wins the auction:

 

[Advertiser Bid] x [Estimated Action Rates] + [User Value] = Total Value

 

Maximizing advertiser value

Advertiser bid
You tell FB your cost goals with your bid strategy and we bid for you to help you meet that goal. This may include a bid cap (for the lowest cost bid strategy or  target cost (for the target cost bid strategy) to guide FB bidding.

Estimated action rates
Each ad has an optimization event, often an action you want a person to take like clicking to a website or installing an app. Estimated action rates represent how likely FB thinks a given person is going to take that action.

FB bases the estimates on the previous actions by the person you're trying to reach and your ad's historical performance data. This helps FB deliver your ads to the people most likely to give you the result you care about.

Regardless of which action you choose to optimize for, FB converts all advertiser values to an effective CPM (eCPM) to allow us to rank ads with different optimization goals and bids. CPM is Cost per 1,000 Impressions — the total amount spent on an ad campaign, divided by impressions, multiplied by 1,000.

Ad quality
FB represents how interested FB thinks a person will be in seeing your ad with measures of its overall quality and specific relevance. For example, if your ad has gotten lots of negative feedback, that can decrease its total value. Or, if the person has a history of being interested in what your advertising, that can increase its total value.

To get an idea of how users are reacting to your ad, check its relevance score.

Optimizing consumer experience

User value
User value is about creating the best and most interesting experience for people across our communities in Facebook . FB considers whether or not someone would want to see your ad, and factor in this expected relevance when FB determines which ad will win an auction. User value captures things like ad quality, expected positive and expected negative engagement from the people in your target audience, and post-click experience.

 

 

Relevance score

Your ad is assigned a relevance score; this estimates how well your ad is resonating with the people you want to reach. The higher your ad's relevance score, the better it's considered to be performing. The score ranges from 1 to 10, where a 1 indicates low relevance and 10 indicates high relevance. FB shows a relevance score for an ad after your ad receives more than 500 impressions.

 

FB bases relevance scores on several factors, including:

  • How well your ad is performing
  • Positive feedback (for example: app installs, clicks, video views) we expect from people who see your ad
  • Negative feedback (for example: Someone clicks “I don't want to see this” on your ad)

 

Relevance vs Relevance Score

Note that Facebook uses user value, not relevance score in calculating total value.

User value takes into account relevance and ad quality. The more relevant your ad is to your audience, the more likely it will be more competitive in ad auctions as well as perform better.

 

Pricing

The more relevant FB predicst an ad will be to a person, the less it can cost the advertiser to show the ad to that person, all other things being equal.

After an ad wins an auction based on its Total Value, the price paid for the winning ad is based on the total value lost by advertisers who competed in the same auction and lost. Because your price is based on the value lost by all of the advertisers you've displaced, and not just one bidder, this minimizes the ability for people to “game” the auction by trying to undercut any single bidder.

 

By default, FB shows your ads to people in your target audience evenly throughout the day across Facebook, Instagram, and other communities. FB does this so we can serve your ad to valuable people throughout your campaign lifetime rather than exhaust your budget within a few hours.

 

Standard delivery

Standard delivery is designed to spend your budget evenly over the duration of the campaign using a method called "discount pacing." Under this method, FB essentially lowers your bid to a level that will just spend your budget over the campaign duration so that you can capture more opportunities at more efficient costs.

 

Accelerated delivery

Accelerated delivery spends budget as quickly as possible by entering every opportunity under your bid cap into the auction. This favors quick spend over maintaining your cost per result. With accelerated delivery, it is possible to exhaust your budget before your scheduled campaign ends. Advertisers with bigger budgets who want to reach people quickly or with time-sensitive campaigns should consider using accelerated delivery.

 

Maximizing user value

How FB determines which ad to show

FB constantly strives to optimize the experience for consumers because showing them high quality, relevant ads makes them more willing to engage with advertisers in the future.

When your ad has a high user value, it means your ad is relevant to your target audience, which will help to boost its total value ranking in the auction.


Formula 

As a reminder, this is an overview of the formula FB uses to determine which ad wins the auction:

[Advertiser Bid] x [Estimated Action Rates] + [User Value] = Total Value

 

User value drivers

If you know your audience well, your ads will likely have solid targeting and relevant content, which then leads to a high user value. As we have mentioned previously, ads with a higher user value can potentially get more delivery and have lower costs. Conversely, ads with lower user value may possibly get less delivery and have higher costs.

 

User value signals

 

User value seeks to optimize the experience for users in FB communities.

 

1. How people interact with organic content.

This signal looks at how people interact with organic content.

In our example, we would look at how much Mr. X has clicked, liked, and shared content posted by friends and family.

 

2. How people interact with paid content

 

This looks at how people interact with ads and other paid content.

 

Ad quality panel

FB taps Facebook users for feedback on ad quality, which is the most important factor in determining user value. The ad quality signals are derived from:

 

  • Evaluation by a representative sample of Facebook users who judge ads in their News Feed primarily on whether or not they want to see the ad.
  • Responses from Facebook users when surveyed about their preference for ad A vs. ad B.
  • Machine learning models that have been trained on the survey results in addition to the factors below.

Post-click experience

FB looks at the drop-off that may occur after someone clicks an ad but abandons the experience before the landing page loads. We want to better match ads with people who are actually going to be able to consume the content. This means that if someone abandons the experience before your landing page loads, it can lower your user value score. See more about post-click experience.

Predicted engagement

Before Facebook runs your ad, FB predicts how people may respond to your ad through actions like clicks, shares, likes, and video views.

 

Repetition

Seeing the same ad over and over can be tiring and a nuisance to users, therefore user value is refreshed to prevent the most repetitive ad experiences.

Therefore user value may go down for someone who has seen a particular ad multiple times already.

 

User value can some times be difficult to predict, since these inputs are dynamic and always changing.

 

After the Click

Zoom Organic’s goal is to deliver the best possible experience for our community of users. For this reason, ads that link to web pages with poor user experience will likely carry low user value. But what makes a poor user experience?

 

Slow load time

Think about what you do when a web page doesn't load right away. You click away and go somewhere else.

To help deliver better ad experiences to people and drive real results for businesses, FB takes into account website performance and people’s connection speeds into FB ad auction and delivery to create a better experience across platforms.  This means FB’s delivery system factors in your website performance together with the targeted person’s network connection speed. FB will show ads to people when they are interested in the content and have a network connection that can quickly load the post-click content.  Advertisers with fast website performance may see higher click rates for certain audiences and at a lower cost. 

 

If this info was of any value please share with a like-minded individual that would appreciate the insight.  Please like, comment and subscribe.

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