How a broader targeting strategy with a lifetime budget affects conversion rate
Experiment ID: #7580
NextAfter
Experiment Summary
Timeframe: 10/02/2017 - 10/10/2017
When launching Facebook ads for our new online course, we had been encouraged by a partner to target a broader audience and allow Facebook to do to the work of optimizing the audience based on conversions.
We set up our targeting in the traditional way, but we also set up a broader ad set targeting people in the United States within our target age range. The budget was set for a lifetime spend over the course of a month.
We wanted to see if this targeting recommendation would outperform our traditional targeting both in conversions and in cost per lead.
Research Question
Will broader audience targeting with a lifetime budget acquire more course registrations?
Design
C: Traditional Targeting
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T1: Lifetime Budget
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[tp-image-grid-height] => 366
[post-thumbnail] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-150x150.jpg
[post-thumbnail-width] => 150
[post-thumbnail-height] => 150
[admin] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-50x26.jpg
[admin-width] => 50
[admin-height] => 26
[full] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting.jpg
[full-width] => 1200
[full-height] => 628
[thumb_372] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-372x195.jpg
[thumb_372-width] => 372
[thumb_372-height] => 195
[single_post_thumbnail] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-980x513.jpg
[single_post_thumbnail-width] => 980
[single_post_thumbnail-height] => 513
[thumb_32_32] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-32x17.jpg
[thumb_32_32-width] => 32
[thumb_32_32-height] => 17
[thumb_48_48] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-48x25.jpg
[thumb_48_48-width] => 48
[thumb_48_48-height] => 25
[thumb_64_64] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-64x33.jpg
[thumb_64_64-width] => 64
[thumb_64_64-height] => 33
[thumb_128_128] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-128x67.jpg
[thumb_128_128-width] => 128
[thumb_128_128-height] => 67
[thumb_122_67] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-122x64.jpg
[thumb_122_67-width] => 122
[thumb_122_67-height] => 64
[thumb_153_153] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-153x80.jpg
[thumb_153_153-width] => 153
[thumb_153_153-height] => 80
[thumb_130_163] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-130x68.jpg
[thumb_130_163-width] => 130
[thumb_130_163-height] => 68
[thumb_232_177] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-232x121.jpg
[thumb_232_177-width] => 232
[thumb_232_177-height] => 121
[thumb_272_325] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-544x285.jpg
[thumb_272_325-width] => 544
[thumb_272_325-height] => 285
[thumb_271_346] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-271x142.jpg
[thumb_271_346-width] => 271
[thumb_271_346-height] => 142
[thumb_271_271] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-271x142.jpg
[thumb_271_271-width] => 271
[thumb_271_271-height] => 142
[thumb_272_172] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-272x142.jpg
[thumb_272_172-width] => 272
[thumb_272_172-height] => 142
[thumb_372_461] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-372x195.jpg
[thumb_372_461-width] => 372
[thumb_372_461-height] => 195
[thumb_372_500] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-372x195.jpg
[thumb_372_500-width] => 372
[thumb_372_500-height] => 195
[thumb_385_270] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-385x201.jpg
[thumb_385_270-width] => 385
[thumb_385_270-height] => 201
[thumb_416_241] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-416x218.jpg
[thumb_416_241-width] => 416
[thumb_416_241-height] => 218
[thumb_448_410] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-448x234.jpg
[thumb_448_410-width] => 448
[thumb_448_410-height] => 234
[thumb_448_410_retina] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-896x469.jpg
[thumb_448_410_retina-width] => 896
[thumb_448_410_retina-height] => 469
[thumb_574_382] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-574x300.jpg
[thumb_574_382-width] => 574
[thumb_574_382-height] => 300
[thumb_776_395] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting-755x395.jpg
[thumb_776_395-width] => 755
[thumb_776_395-height] => 395
[gform-image-choice-sm] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting.jpg
[gform-image-choice-sm-width] => 300
[gform-image-choice-sm-height] => 157
[gform-image-choice-md] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting.jpg
[gform-image-choice-md-width] => 400
[gform-image-choice-md-height] => 209
[gform-image-choice-lg] => https://www.nextafter.com/wp-content/uploads/Broad-Targeting.jpg
[gform-image-choice-lg-width] => 600
[gform-image-choice-lg-height] => 314
)
)
)
Results
| Treatment Name | Conv. Rate | Relative Difference | Confidence | |
|---|---|---|---|---|
| C: | Traditional Targeting | 1.3% | ||
| T1: | Lifetime Budget | 0.28% | -79.2% | 100.0% |
This experiment has a required sample size of 654 in order to be valid. Since the experiment had a total sample size of 10,314, and the level of confidence is above 95% the experiment results are valid.
Flux Metrics Affected
The Flux Metrics analyze the three primary metrics that affect revenue (traffic, conversion rate, and average gift). This experiment produced the following results:
0% increase in traffic
× 79.2% decrease in conversion rate
× 0% increase in average gift
Key Learnings
Ultimately, this targeting methodology did not work for this offer. We saw a 75% decrease in registrations, and a 208% increase in cost-per-lead after running it for 8 days.
It’s possible that spending more up front could lead to enough conversions for Facebook to learn which users are most likely to convert – causing the cost-per-lead to level off over time. But even in this is the case, the cost-per-lead would have to come down enough to off-set the initial investment.