STOP Talking About Cost per Conversion in Facebook Ads

Introduction

When promoting your music on Spotify using Meta ads, it’s essential to understand the intricacies of marketing metrics, particularly the oft-cited “cost per conversion” (CPC). While this number is widely discussed in the advertising field, it's crucial to grasp what it truly represents, where it fits within the marketing funnel, and why it might lead to misleading conclusions about your campaign's performance.

Understanding Cost per Conversion

At its core, cost per conversion is the expense incurred to prompt a customer to take a valuable action after seeing your ad. In music marketing, this customer is a potential listener, and the valuable action usually refers to someone clicking through to a streaming service like Spotify via a third-party landing page (such as Hyped.it or Feature FM). Currently, we cannot embed a Meta pixel directly on Spotify to track actual listening, making these landing pages the next best measurement tool.

The Flaws in Cost per Conversion

The difficulty with focusing solely on cost per conversion lies in the definition of the conversion event itself. While the “conversion” is a key performance indicator, it does not accurately reflect the ultimate action we care about: listeners streaming and engaging with our music.

In marketing, we typically visualize the process as a funnel with various stages:

Impressions: This is when someone views your ad. At this stage, the audience is maximal, potentially reaching hundreds of thousands.
Link Clicks: This is where a smaller subset of people who see the ad actually click on it to visit your landing page. Here, only about 1.5% to 3% of impressions may convert to link clicks, depending on your ad's appeal and targeting.
Conversions: Upon reaching the landing page, a percentage of link clickers will perform the conversion action (e.g., clicking on a streaming link). A strong campaign might see 50%-67% of link clicks translate into conversions.
Listeners: Ideally, we would want to track how many of these conversions result in actual streams on Spotify. Typically, this percentage also hovers around 50%, representing an additional drop-off from conversions to listens.
Streams: The ultimate goal is to generate streams of your music, which is difficult to measure accurately through ads due to tracking limitations.

Metrics in Meta Ads Manager

You can track these metrics within Meta Ads Manager and Spotify for Artists. The impressions are listed by default, but to find the link clicks column, you need to customize your settings. Conversions are reported under the results column, and views from Spotify for Artists provide insights on actual listeners and stream numbers.

Understanding these multiple layers of the marketing funnel clarifies how misleading it can be to solely rely on cost per conversion as a performance metric, as it does not directly correlate with our end goal: listener engagement and stream counts.

Key Takeaways

Using only cost per conversion to measure your campaigns creates a limited perspective. Though it can be a convenient metric, it’s essential to recognize its limitations in providing a comprehensive view of campaign performance.

Keyword

Cost per conversion, Meta ads, music marketing, impressions, link clicks, conversions, listeners, streams, Facebook advertising, marketing funnel.

FAQ

Q: What is cost per conversion?
A: Cost per conversion refers to the amount spent to encourage a user to take a valuable action after viewing an ad, such as clicking through to a music streaming service.

Q: Why is cost per conversion not a reliable performance metric?
A: It only measures one aspect of the marketing process and does not reflect the ultimate goal of generating listeners and streams on platforms like Spotify.

Q: What metrics should I consider alongside cost per conversion?
A: Consider tracking impressions, link clicks, actual conversions, listeners, and stream counts for a more comprehensive understanding of your campaign's performance.

Q: How can I improve my ad campaign's performance?
A: Focus on enhancing ad creative, better targeting your audience, and optimizing your landing pages to increase the transition rates between each stage of your marketing funnel.