Even though we look at MER as our true North Star for performance, we still need a measurement in the ad account to see how performance is and if a specific campaign or ad is performing.
The way we do this is by using ‘attributed ROAS’.
We see the average percentage of sales that is attributed by Facebook/Instagram compared to the overall sales and calculate this back to our MER Goal and ROAS.
We compare the attributed revenue from Facebook pre-iOS14.5 and after to get a better picture of how accurate this ROAS number is.
Might sound difficult, but it’s not. We use this on a daily basis to measure true performance.
Example: Sales are $100k at a 5x MER (your goal is 4.5x so you had a good month). That means you have spent $20k on ads (to keep it simple let’s say 1 platform).
With that $20k spent on Facebook/Instagram you only saw a 1.2x ROAS (or $24k in sales) so you now know that your attributed revenue from FB is 24% (24k/100k) – so as long as your attributed revenue from FB stays similar you know you’re good to scale on a 1.2x ROAS.
The real ROAS number you need to look for is 24% of 4.5x MER, so anything over 1.08x ROAS and you’re good to scale.
When you put all this data in a sheet you can re-calculate these metrics on a weekly basis.