Demystifying Facebook’s Ad Relevance Score Could Save You Hundreds Of Thousands

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Demystifying Facebook’s Ad Relevance Score Could Save You Hundreds Of Thousands

Why is Facebook’s relevance score relevant to you? Because using it to your advantage could potentially mean hundreds of thousands of dollars a year in revenue from Facebook advertising.

So, what is relevance score or RS? Facebook wants its users to have a great experience. As ads have become a big part of the Facebook experience, Facebook has maintained a quality experience by showing the most relevant ads possible to its users. If a user sees a highly relevant ad, they actually perceive the ad as a positive experience rather than a negative one.

In February 2015, to help advertisers know how well they’re doing at providing relevant ads to consumers, Facebook launched a new measurement category called relevance score. Ads receive a relevance score between 1 and 10, with 10 being the highest. The score is updated as people interact with an ad and provide feedback. It’s a similar concept to Google’s quality score measurement on AdWords paid search. Just as we’ve found over the years with Google’s quality score, it’s clear that by increasing relevance scores of Facebook ads, we can decrease the cost/click and cost/conversion of ads. This saves our clients hundreds of thousands of dollars a year.

There’s only one problem: Facebook has been somewhat vague about what actually drives relevance score. Perhaps they think that if people know the formula, they can start figuring out ways to cheat it. At SmartClick, we’ve got data– A lot of it. We decided to draw on our own clients’ historical statistics and run some analyses to drill into what really contributes to relevance score. Here’s our 4 most significant findings on how Facebook determines relevance score:

1. Click-Through Rate on Ads Is Highly Correlated with Relevance Score
Despite the fact that Facebook’s page on relevance score doesn’t even mention click-through rate (CTR), regression analysis reveals that click-through rate is mostly the only determinant of relevance score, with over 85% of changes in RS being explained by changes in CTR. If you can get a higher CTR with ads, you’ll get a higher RS. It’s that simple.

2. Negative Feedback Doesn’t Really Matter, But Positive Feedback Does.
When Facebook announced it would be adding relevance score, they stated that it would be calculated “based on the positive and negative feedback an ad receives from its target audience.” The idea was that, “the more positive interactions an ad receives, the higher the ad’s RS will be. The more times people hide or report an ad, the lower its score will be.” While both positive and negative feedback influence the score to a small degree, it turns out that positive feedback is far more important. In fact, our analysis revealed that positive feedback is nearly 11 times more powerful in determining RS, with an r-squared of 0.10.

3. Ad Objective Doesn’t Really Impact RS.
When setting up a new campaign, Facebook lets you choose from 10 different objectives (App Installs, Page Likes, Website Conversions, etc.). Facebook claims that relevance score will vary depending on what ad objective you choose. However, our analysis revealed that the effects of campaign objective on RS are minimal. Specifically, only 6% of an ads score can be explained by its objective.

4. Relevance Score Drives Over 50% of The Cost Per Click of an Ad
Cost/click is negatively correlated with relevance score. Analysis shows that a change in relevance score is responsible for 58% of any change in cost/click. In other words, over 50% of any change in cost/click is a result of getting relevance score up, which of course is 85% correlated with click-through rate.

We now have clear statistical evidence that if we get click-through rate on an ad up, relevance score will go up, and cost/click will go down. It’s that simple. If you’re serious about driving return on investment with Facebook ads and you’re not getting the ROI you’d like to see, the first place you should start is by realizing it’s all about click-through rate. Ads should be designed with the intend of getting a relevant audience to click-through. Way too many brands focus on ads’ recallability or mentioning every single benefit of the product. Their ads become cluttered messes without a simple action for users to follow. The goal of a Facebook ad should be to get as many relevant users to your website (meaning you’ll have a high CTR rate). Once there, your website (if it’s good) will do the actual selling.

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