Presentation on how to chat with PDF using ChatGPT code interpreter
Hussein Fazal, SMASH Summit NYC
1. Facebook Ads – The Math behind the Magic
www.adparlor.com
2. Hussein Fazal – CEO, AdParlor
Ads API Partner – manages ~1 Billion daily impressions on Facebook
3. What works on Facebook?
Intent (search versus Facebook)
Deep Conversions
o Does education, insurance, flowers work on
Facebook?
o Definitely not if you treat it like search!
Shallow Conversions
o Playing a Facebook game
o Liking a Facebook fan page
o Registering for a web site via Facebook connect
4. Some Basic Terms
CTR – Click Through Rate
CVR – Conversion Rate
CPM – Cost per 1,000 impressions
eCPM – Effective cost per 1,000 impressions
CPC – Cost per click
CPA – Cost per acquisition
4 Clicks from 10,000 Impressions = 0.04% CTR
2 Acquisitions from 4 Clicks = 50% CVR
4 Clicks * $0.30 CPC = $1.20 Cost
$1.20 Cost / 2 Acquisitions = $0.60 CPA
5. Ad Server Fundamentals
Any ad network wants to choose the ad with the
highest eCPM
o This is true for Facebook and amplified by their focus on
user experience
A high CTR means you can buy cheaper clicks
A high CVR means you get more conversions
for those clicks
6. The Importance of CTR
Difference in eCPM based on the CTR [hold CPC bid constant]
Impressions CTR Clicks CPC Bid eCPM
1,000 1.00% 10 $ 0.50 $ 5.00
1,000 0.10% 1 $ 0.50 $ 0.50
1,000 0.05% 0.5 $ 0.50 $ 0.25
1,000 0.01% 0.1 $ 0.50 $ 0.05
8. The Importance of CVR
Difference in eCPA based on the CVR [holding cost constant]
Cost Clicks CVR Conversions eCPA
$ 5,000.00 10,000 40.00% 4,000 $ 1.25
$ 5,000.00 10,000 50.00% 5,000 $ 1.00
$ 5,000.00 10,000 60.00% 6,000 $ 0.83
$ 5,000.00 10,000 70.00% 7,000 $ 0.71
9. Understanding Ad Optimization
Don’t talk to me about pricing unless you
understand CTR and CVR
High CTR = cheaper clicks
High CVR = more conversions for those
clicks
Create thousands of ad, learn in real-
time, and optimize CTR and CVR
By optimizing on CTR/CVR you are
essentially driving down your CPA
10. Quick Tangent - Sponsored Stories
“Something that would appear on a users news feed – turned into an ad unit”
11. Why do Sponsored Stories get you cheaper fans (technical)?
Higher Click-Through-Rate (CTR) Higher Conversion Rate (CVR)
gets you cheaper clicks gets you more for those clicks
12. Why Do Sponsored Stories get you
cheaper fans (high level)?
Because it is a story – not an ad.
Remember - “Something that would appear on a users news feed
– turned into an ad unit”
Before sponsored stories:
o More Fans = More expensive for the next Fan
Since sponsored stories:
o More Fans = Cheaper for the next Fan
13. If the Ingredients are Perfect
Super Targeted
$.08 Able to achieve 0.29%
Fan Acquisition CTR and 81% CVR
through life of campaign
Campaign
Effective Cost Per Fan
19. Deal Specific Ads
Integrate with Groupon Deals API
Pull deals as they go live at
midnight in local timezone
Machine learning to determine who to target
Set Facebook Ads live within minutes of deal going live!