How To Use Facebook Ad Relevance Diagnostics To Improve Ad Quality
Since Facebook replaced Ad Relevance Score with Facebook Ad Relevance Diagnostics in April 2019, there have been a lot of questions on how to interpret results and link them back to campaign performance.
One misconception is that "High relevancy means high performance" - that's not always the case. Facebook has provided a complete guide to diagnose underperforming ads across 3 dimensions of relevance: quality, engagement and conversion.
However I personally find it too vague and confusing, so I have decided to simplify and correlate each "ranking" to a Facebook Ads metric:
- Quality Ranking - CPM
Quality ranking explains how your ad's perceived quality compares to ads competing for the same audience. In short, if your ad quality is Above Average, you will get lower CPM as you outperform your competitors. - Engagement Rate Ranking - CTR
Engagement rate ranking explains how your ad's expected engagement rate compared to ads competing for the same audience. If your ad engagement rate is Above Average, it means your ad is more relatable compared to all other ads your audience is seeing, hence getting higher CTR as you capture their attention right away. - Conversion Rate Ranking - CPA
Conversion rate ranking explains how your ad's expected conversion rate compares to ads with the same optimization goal competing for the same audience. Again, if your ad conversion rate is Above Average, it means your ad is able to convert your customers better than your competitors, hence resulting in a lower CPA.
Now here's the interesting part.
Since CPC is cost per click, so the formula for it is super simple: CPC = (Total Cost) / (Number of Clicks).
You may also derive it from CPM and CTR:
CPC = (CPM / 1000) / (CTR / 100)
= 0.1 * CPM / CTR.
Both Quality Ranking and Engagement Rate Ranking will directly affect your CPC, which make or break your Facebook campaigns. In order to get a low CPC, you need to get an Average or higher on both Quality Ranking (low CPM) and Engagement Rate (high CTR).
Conversion Rate Ranking wise, a video ad will always outperform image ads if you have done your research properly (including competitive research and optimizing funnels) as the video itself tells a story with more attention span.
Now your best bet would be to win by getting a lower CPC.
How? By getting lower CPM and higher CTR.
How? By using more creative ad text, headlines and thumbnails that are closely relatable to the audience you're targeting.
If you understand the last 3 points, you're definitely on the right track.
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