How To Reduce Your Cost Per Lead With Meta Advantage+

Allocating your budget effectively is crucial to optimize lead generation campaigns and reduce lead costs on Meta using Advantage+. This article covers the best methods and formulas to determine the most cost-effective budget allocation for your Advantage+ campaigns on Meta. By following these strategies, you can leverage Meta’s powerful optimization capabilities, ensuring your ad spend is used efficiently to maximize ROI and drive high-quality leads.

How to Tailor Advantage+ Settings to Optimize for Lower Lead Costs in High-Spend Campaigns

Advantage+ is a useful tool that can help you get leads more cheaply by using Meta’s smart algorithm. Here’s how you can set it up to get better results:

Accessing Advantage+ for Lead Generation

First, make sure your account is allow-listed for Advantage+ by contacting your Meta representative. Although Advantage+ is mainly for purchase events, you can adjust it to focus on lead generation.

Defining Audiences for Algorithm Training

To make the algorithm work well, you need to provide it with the right audience information. Here’s how to set up your audience definitions within Advantage+ for optimal performance:

Existing Customers

Existing Customers is a feature within Advantage+ Shopping Campaigns on Meta. It is best practice to upload pixel-based lists of past leads as well as CRM lists of past leads, if possible. This helps the algorithm understand who your leads are and what potential new leads might look like, similar to a lookalike audience.

• CRM Lists: Import custom lists from your customer relationship management system (CRM), or platforms like Klaviyo, which include individuals who have previously become leads. This helps the algorithm identify and target similar users.
• Pixel Data: Use pixel data from up to 180 days to show the algorithm how users behave on your site.

Brands can choose to exclude these “existing customers” or allow Meta to partially spend towards them. However, for lead-based campaigns, it generally makes more sense to exclude them to avoid retargeting current leads, which wouldn’t be as beneficial as in ecommerce campaigns.

Engaged Audience

Engaged Audience is another feature within Advantage+ Shopping Campaigns that helps advertisers further define what potential customers look like. This is another way of “feeding the algorithm” with knowledge.

• Site Visitors: One of the main audiences you can add here is site visitors. Unlike the “Existing Customers” functionality, you cannot exclude the audience that you define under the “Engaged Audience” function.

For instance, a company can import a list of past leads and use website data to help the algorithm find similar new leads. Adding people who interact with social media can also help widen the reach and improve lead quality, although this specific functionality may not yet be fully available within Advantage+.

Always exclude current leads to avoid wasting money and include broader audiences to reach more people.

By properly defining your audiences and leveraging both the Existing Customers and Engaged Audience features, you can effectively train Meta’s algorithm to target the most promising prospects, thereby optimizing your lead generation efforts and reducing costs.

Geo-Exclusion Targeting

One of the most effective advanced targeting strategies is geo-exclusion. This is especially useful for businesses with specific service areas, like franchises or local branches.

It allows you to create lists of locations where your business doesn’t operate to prevent your ads from showing in areas where you can’t service leads, saving ad spend.

You can upload these exclusion lists directly into Meta, applying them to all Advantage+ campaigns in your account.

Imagine a franchise business with locations in 30 states. Without geo-exclusion, Advantage+ Shopping campaign ads would target the entire country, including areas without franchises, generating leads that can’t be converted due to geographical limits. By using geo-exclusion, the business can focus ad spend on the 30 states with franchises, ensuring every lead generated is within a serviceable area, optimizing the budget and reducing the cost per lead.

It’s best to keep geographic targeting broad while strategically excluding non-serviceable areas to maximize reach and efficiency. You can occasionally exclude specific regions based on poor past performance, but do this sparingly to avoid missing potential opportunities.

Bid Strategies: Minimizing Costs with Advantage+

Implement strategic bid tactics to effectively reduce lead costs on Meta using Advantage+. This section explores bid strategies that have proven successful in minimizing costs, focusing on the unique features of Advantage+ and how to optimize its use for lead-generation campaigns.

Utilizing the Existing Customer Bid Cap Percentage Feature

The budget cap percentage feature helps you control your campaign’s budget for better lead generation.

When you set a 0% budget cap on your existing customer lists, all ad spend is directed toward attracting new leads. This ensures that the campaign focuses on expanding the customer base rather than retargeting existing users who are already in your CRM system. By setting strict budget caps, you can prevent ad spend from being wasted on leads that are already known to your system. Instead, the budget is allocated to acquiring potential new leads, maximizing the efficiency of your ad spend and increasing the chances of attracting new customers.

While privacy changes might cause some budget leakage, setting strict budget caps helps in focusing on new leads, which is key to maximizing net new customers.

Account Diversification

Relying only on Advantage+ can be limiting because there are few manual adjustments available. Running different types of campaigns alongside Advantage+ is an important strategy to optimize lead generation.

Use Advantage+ as your main tool, but also run traditional manual campaigns to allow for more control and testing of various elements like creative and audience targeting.

Use the manual campaigns to test new creatives and audience segments. Once successful, integrate these proven ads into your Advantage+ campaigns to improve efficiency.

Having multiple campaigns ensures that if one underperforms, others can make up for it, stabilizing overall lead generation and reducing risks.

Creative Optimization

Effective creative optimization is key to lowering lead costs on Meta using Advantage+. Here’s how to use Advantage+ to optimize your ad creatives and the best testing strategies to reduce lead costs.

Feeding Advantage+ with Proven Creatives

To get the best results with Advantage+, use high-quality, proven creatives instead of testing new ones. This approach leverages Meta’s algorithm to optimize performance further and reduce lead costs by focusing on content already proven to resonate with the target audience.

Advantage+ is designed to deliver the best content to the most relevant audience. Testing unproven creatives here can lead to inefficiencies and higher costs.

Conducting Creative Testing in Manual Campaigns

Test your creatives in manual campaigns before using them in Advantage+ to identify the most effective ads. Testing may be conducted on elements like visuals, copy, and calls to action.

Evaluate the performance of each creative based on metrics like click-through rates, conversion rates, and cost per lead. Identify the best-performing creatives from these tests to feed into Advantage+.

Prioritizing Net New Creatives

While Advantage+ can handle multiple creatives, focus on distinct and proven ads rather than minor variations.

Regularly update Advantage+ with new winning creatives from manual campaigns to keep the content fresh and engaging.

Continuous Monitoring and Adjustment

Even with the best creatives, continuous monitoring and adjustment are crucial for maintaining and improving performance.

Use UTM parameters and detailed analytics to track the performance of each creative within Advantage+. Regularly review performance data and turn off underperforming ads to reallocate the budget to top performers.

Keep feeding the platform with high-quality, proven creatives and continuously refresh content based on performance data. By conducting initial creative testing in manual campaigns and prioritizing distinct, successful ads, brands can leverage Meta’s powerful algorithm to effectively reduce lead costs. This strategic approach ensures that Advantage+ maximizes its potential, delivering high-quality leads at a lower cost.

Conversion Tracking and Enhancement

Proper conversion tracking allows brands to measure campaign effectiveness accurately, optimize for better results, and ultimately reduce lead costs in Advantage+ campaigns.

Conversion tracking provides real-time data on ad performance. By integrating tracking mechanisms, you can monitor which ads generate the most leads and adjust your strategy accordingly.

It’s essential to align what Meta reports with your backend metrics, such as your CRM data to understand the true cost per lead (CPL), which is often more reliable than platform-reported metrics alone.

By reconciling data, you can identify which creatives and ads are truly driving valuable leads at a lower cost and refine your Advantage+ campaigns by turning off underperforming ads and reallocating the budget to the best-performing ones.

Whether manually with UTM parameters or using dynamic tags, be sure to tag each ad within your Advantage+ campaign appropriately to track the source of leads, distinguishing between different campaigns, ad sets, and individual ads within Advantage+ campaigns to ensure accurate attribution and performance assessment for each campaign element.

Advantage+ uses Meta’s AI to optimize ad delivery based on performance data. By feeding the algorithm accurate conversion data through precise tracking, you enable it to make better optimization decisions, reducing your CPL over time.

By implementing robust tracking mechanisms, using UTMs, and reconciling platform data with backend metrics, brands can clearly understand their campaign performance, allowing for strategic adjustments that leverage Meta’s powerful algorithms to optimize ad spend, resulting in lower lead costs and higher ROI.

Budget Allocation

Allocating your budget effectively is crucial for optimizing lead generation campaigns and reducing lead costs on Meta using Advantage+. This section discusses methods and formulas to determine the most cost-effective budget allocation for Advantage+ campaigns.

Basic Rule of Thumb for Budget Allocation

When starting with Advantage+, a fundamental approach is calculating your minimum daily spend based on your average cost per lead.

To determine your minimum daily spend, find your historical average cost per lead and multiply it by 50 (aiming for 50 leads per week). Then, divide the weekly goal by 7 to determine your daily spend.

So, for example, your average cost per lead is $10, then your weekly goal would be $500 (50 leads x $10). Dividing this by 7 gives you a daily budget of approximately $71. To ensure you exit the learning phase effectively, consider increasing this minimum slightly, perhaps to $80 per day.

Scaling Your Budget Gradually

Once your campaign is performing well, you can start to scale your budget. It’s important to do this gradually to maintain performance and avoid disrupting the algorithm’s optimization process.

Increase your budget by no more than 20% at a time to allow the algorithm to adjust without drastic performance fluctuations. Track performance daily to ensure that increased spend continues to meet your cost-per-lead goals.

Ensuring Diversification

While Advantage+ is a powerful tool, relying solely on it can be risky. Diversifying your campaign types ensures stability and provides more levers for optimization. Run traditional manual campaigns alongside Advantage+ to test different creative elements and target strategies more granularly.

Currently, allocating 30-50% of your total ad spend to Advantage+ is considered healthy. This allows you to leverage its capabilities without over-reliance.

Having a diversified account structure ensures that if Advantage+ underperforms or encounters issues, other campaigns can compensate.

Brands can effectively reduce lead costs on Meta by leveraging the powerful optimization capabilities of Advantage+ while maintaining a flexible and responsive campaign structure, ensuring that ad spend is utilized efficiently, maximizing ROI and driving high-quality leads.

Reducing Lead Costs On Meta

Effective budget allocation with Advantage+ is a game-changer for high-spend ecommerce brands looking to optimize their lead generation efforts. By starting with a solid foundation, gradually scaling budgets, and maintaining a diversified campaign strategy, you can significantly reduce lead costs and enhance overall campaign performance. 

Remember, the key to success lies in consistent monitoring, adjustment, and optimization, enabling your brand to efficiently reduce lead costs on Meta.

About the Author: As the Strategy Lead for Paid Social at adQuadrant, Daniel Shepherd brings ad buying experience across the multitude of social and search platforms with millions of ad dollars managed annually. He loves being a great teammate and learning new skills often. Outside of work, you’ll find Daniel doing the following: swimming, drinking Philz Coffee, lifting weights, reading the Bible with friends or neighbors, dancing, perfecting his fantasy football team, and most of all spending time with his wife and kiddos.