For over a decade, we all loved Meta’s ad performance with higher ROAS and returns. That’s being challenged now by changing privacy regulations, and browser updates and raising concerns over privacy by users themselves.
There were many rigid rules and regulations such as third-party data cookies being blocked, user privacy concerns, iOS14 updates, and of course, let’s not forget the iOS17.
These rules and regulations have comfortably made users opt out of tracking. One such hit is the declining effectiveness of Facebook Pixel tracking which had a direct impact on the performance of advertising.
Witnessing this issue, the social media advertising platform has crafted a solution revolving around first-party data involving the utilization of Facebook Conversions API. This solution will enable the secure transfer of first-party data to the Meta while prioritizing user privacy.
In this blog, let’s know about what Facebook Conversions API is, how to set it up, its best practices, and more…Dive in!
What is Facebook Conversions API?
The Facebook Conversions API is a server-side tool offered by Facebook allowing advertisers to send first-party data or events, from their websites, apps, or servers – to the Facebook server to optimize and measure ad performances.
Role of Conversions API
- The Conversions API will be able to track in-app purchases, registrations, and content downloads among others.
- The Conversions API helps marketers to attribute conversions to specific ad clicks across the devices.
- Benefits marketers with a deeper understanding of funnel actions beyond clicks and impressions.
- Leverages conversions for measurement, automation, and optimization.
- Ingests rich conversion metadata like revenue, items purchased, and custom parameters.
Why did Facebook create the Conversions API?
Due to privacy updates and browsers blocking third-party data cookies, the effectiveness of Facebook Pixels (a code written on the browser side to track users’ data) saw a constant decline in providing customer information.
There were concerns. There was a rift when it came to concerns that needed to be addressed by businesses for users’ data and concerns that needed to be addressed by Facebook for marketers.
- Privacy Concerns: Amid the rise of stringent data protection regulations like the General Data Protection Regulation (GDPR) and Consumer Data Protection Act (CDPA), the declining relevance of third-party data cookies in addition to Google Chrome’s plan ‘to let users block third-party cookies’ – have all posed threats to conventional tracking methods. In response to this, Conversions API emerged as a solution (on the server side) to precisely track while upholding user privacy.
- Decrease in Pixel Reliability: As mentioned earlier, there are many rules like ad blockers and the limitations of browser-side tracking, have created obstacles for Facebook’s Pixels data tracking. By introducing Conversions API, Meta aimed to provide advertisers with a more reliable server-side-based solution.
- Future-Proofing Advertising Strategies: Meta being aware of the traditional tracking methods becoming obsolete, started taking measures to ensure advertising platforms remain relevant in the future. To achieve this, Meta has introduced an alternative approach enabling advertisers to monitor conversions efficiently. This approach is the Conversions API.
The concerns were put forth, hence solutions were readymade!
How Conversions API Enhances First-Party Data Adoption?
- Direct & Reliable Data Connection: The Conversions API ensures a more secure and robust exchange of users’ data reducing the risk of data loss caused by ad blockers and browser limitations. By using Conversions API, businesses can effectively adopt first-party data, gaining valuable insights into user behavior without solely relying on third-party cookies or client-side tracking.
- Improved Ad Targeting & Personalization: With more understanding of users interactions through first-party data has made businesses hyper-target their ad campaigns. Facebook Conversions API joining hands with Facebook Pixels has benefited advertisers to obtain valuable customer behavior insights across various stages of the sales funnel. This has led to better ad performance and higher conversion rates.
- Strengthen Data Control and Privacy Compliance: With Conversions API, businesses have greater control over the data they share with Facebook. With user data being collected on the server side, advertisers can exercise tighter management of the collected data ensuring adherence to privacy regulations. This fosters trust among customers knowing their privacy will be protected and respected.
How does Facebook Conversions API (CAPI) work?
The Facebook Conversions API works by establishing a direct connection between an advertiser’s marketing data and the systems used by Facebook to optimize ad targeting, measure outcomes, and decrease the cost per result. It enables businesses to send various types of events, such as website events, app events, and offline conversions, from their servers, website platforms, mobile apps, or CRM systems to Facebook.
For example, when a user clicks on a Facebook Ad of an e-commerce website, and makes a purchase on that site, the advertiser’s conversion tracking server captures the user ID, timestamp, item purchased and revenue when the purchase event occurs.
This purchase conversion data will then be sent to Facebook via Conversions API. Facebook then will attribute this purchase conversion to the previous Facebook Ad that the user had already clicked.
In the Ads Manager, advertisers will be able to see a purchase conversion attributed to their Facebook Ad as a result of implementing Facebook Conversions API.
For instance, when you land on a website, your data will be collected on the server side and will be sent to Facebook’s server through FB CAPI. Which will ultimately maximize ad campaign performance on Facebook Ads.
How to Set Up Facebook Conversions API?
Setting up CAPI is not a cakewalk!
Meta Conversions API can be set up in two ways; implementing CAPI manually or with the help of developers. This involves a lot of steps and procedures starting from setting up a Facebook business account to creating pixels and involving various steps to accomplish setting up Conversions API.
Sometimes, you might also need the help of developers while setting up the account.
We at CustomerLabs, have come up with a unique method to track all offline events and online events, without any help from developers or involving writing a single line of code.
Just install our tag and set yourself free!
Here’s a quick step-by-step guide for setting up the Conversions API of Facebook.
Activating First-Party Data through Facebook Conversions API Across the Customer Funnel
Any businesses will have 3 objectives to leverage their first-party data through the Facebook Conversions API;
- Prospecting
- Optimization
- Re-engagement
Prospecting
When a customer lands on your website, it marks the beginning of their interaction with your brand’s product or service. This interaction is an opportunity for your business to get valuable information about the customers. In this stage, utilization of first-party data can help you to reach new customers who have never interacted with your brand or reach out to prospective users who have interacted but haven’t purchased.
Take the example of Hyundai,
By using conversion leads optimization saw an average of 20% increase in lead-to-sale conversion rate. It also saw 42% more qualified leads and a 29% decrease in cost per qualified lead.
Optimization
Once after collecting data about new customers, their preferences, behavior, and interactions – all of this information can be used to create personalized ad campaigns tailored to specific audience segments. Additionally, by using first-party data, you can identify and target high-value customers who are likely to generate significant revenue over time. To gain these lifetime valued customers, optimizing ad campaigns through first-party data will be of help.
Fever, a global entertainment discovery platform, by making use of the optimization strategy in Facebook Conversions API has begun to understand its customer journey. With this, they combined both Conversions API and Custom Conversions, saw a 2.1X increase in ROAS, 2.4X increase in content view, 2.8X lower cost per purchase, and 2.4X lower cost per view content.
Re-engagement
Now when a customer has landed on your website, he/she might have made some engagement with your product or service. Here, first-party data along with Facebook CAPI can be utilized to drive loyalty with acquired customers for re-engagement. This can be done by implementing re-engagement tactics – through cross-selling or upselling. Additionally, one main advantage of re-engaging customers is that it can help reduce churn and retain customers.
Here, let’s take the example of how W for Woman, India’s largest fashion brand, has achieved match rates beyond 80% using re-engagement strategies. After getting their first-party data handy, W for Woman started engaging those who visited the website for the last 180 days, viewed content, or purchased for the last 30 days and retargeted them by luring them to purchase other products.
With this, they have achieved a 2X times increase in ROAS, a 35% reduction in Customer Acquisition Cost, and 10% revenue solely from first-party data.
With activation, let’s now take a look at the powerful applications of CAPI.
Powerful Applications of the Conversions API
With the digital landscape taking a rollercoaster, businesses are looking out for innovative ways to optimize their online presence. Facebook has crafted the Conversions API tool from which marketers can benefit.
- Attribution Modeling: The Conversions API for attribution modeling, sends more accurate and comprehensive data about customers’ journeys and actions (purchases, sign-ups, or any other conversions) from the server – directly to Meta’s server by attributing conversions to specific touchpoints.
- Lookalike Modeling: Facebook Conversions API allows businesses to send quality customer information directly from their server to Meta to identify and create audiences who have similar characteristics of existing or high-value customers, and are likely to take desired actions.
- Predictive Analytics: Facebook Conversions API facilitates real-time customer information using AI and machine learning for businesses to gain valuable insights about users enabling businesses to build predictive models forecasting user behavior and lure them to engage with products and services.
- The Conversions API is an important component of Facebook’s advertising system as it supplies Facebook’s algorithms with conversion event data of users that are required to power automated bidding. These conversions involve actions like purchases, registrations, or other specific goals that businesses eagerly wait for. CAPI here enables automated bidding used to tailor bids based on the conversion signals received.
- For CRM Integration, Facebook Conversions API enables businesses to send customer information and behavior directly from their CRM systems to Meta. This helps in the seamless transfer of user information helping businesses to better understand customer preferences and tailor ad campaigns.
- Cross-device tracking: Facebook CAPI helps marketers in tracking and sending user behavior data from their server to Facebook, ensuring whether these conversions are attributed to the correct users irrespective of the devices they use.
- Event Match Quality: Facebook Conversions API enables marketers to measure and optimize their ad campaigns by enabling them to send direct event data of customers from their websites or apps to Facebook. Here, EMQ plays a significant role by rating campaigns as Poor, Okay, Good, or Great leading to precise attribution, improved ad targeting, and helping marketers to take an informed decision for marketing.
Best Practices for Conversions API
Let Meta Pixels & Meta Conversions API join hands to provide you with user data;
Facebook recommends that both Meta Pixels and Meta Conversions share the same events simultaneously. For instance, if you are sharing a purchase event using Meta Pixels, you should share the same event using Conversions API.
This process of sharing the same events is termed a redundant event setup. This setup would help businesses to target more accurate users who are likely to take action.
But here, you might now be worried that, okay, we will take data from both, but what about duplication? What if I get the same data twice?
For this, Meta has brought in a significant tool called “Deduplication”. So when you are ready with the redundant setup, you may receive the same events from both the browser and the server. Now, when the events are the same and redundant, one event will be kept and the other will be discarded. This process is called deduplication.
Deduplication is necessary when you are getting information from both the server and browser.
Sharing Events in Real Time… or at least CLOSE to real-time!
The sooner, the better!
Meta recommends that you share the events of users in real-time with the Meta server. This is because it will be easy for the ad delivery system to evaluate how a person is likely to take the desired action.
Improve your ad performance by connecting more pixels, expanding integrations;
Here, connecting more pixels to Conversions API integration can help you to improve your ad performance. Think of getting data from both Conversions API & Pixels. You will just have more!
Regularly Monitor Your Connection:
To get more out of Meta Ads, CAPI should be used at its maximum, and also regularly monitor the event data being synced. This helps you to find opportunities to improve your setup for better ad performance.
Conversions API Vs FB Pixel
When it comes to tracking and measuring conversions on Facebook, two popular methods are used: Facebook Conversions API and Meta Pixels. Both tools offer valuable insights into user behavior and campaign performance, but they differ in terms of data accuracy and privacy concerns.
Meta Pixels are those which are placed on the website or a landing page. This tracks users’ interactions and sends event data back to Facebook. Whereas, Facebook Conversions API is a strong server-to-server connection enabling more accurate tracking of conversions that occurs outside the web browser.
With the browser-based limitations, it has become difficult for Facebook Pixels to track user data as they are reliant on users’ browsers but the FB CAPI, being on the server side, accurately tracks and sends data to Meta’s server.
Why Ponder CustomerLabs Facebook Conversions API?
CustomerLabs CDP has emerged with a unique method to track all the events off & on your website without the need for any complex coding.
All you have to do is install our tag and relax! Everything is ready within a few hours – From Offline Conversions API to Online Conversions API including the data from CRMs.
We assign an external ID to every single visitor, and we collect IP address, FBC(click ID), FBP (browser ID), user agent, and other parameters (demographics).
The above process is automated. CustomerLabs makes it easy for you to implement CAPI and is one of the best because we offer
- No-Code CDP
- Enhanced Event Match Quality (EMQ)
- Enhanced Custom Audience Match Rate
- In Compliance with Privacy Laws
- White hand glove Support
Conclusion
With the rapidly evolving technology, concerns surrounding user-data privacy have become paramount. With more rigid rules and regulations being implemented, Facebook has stepped in to take measures of both users’ privacy concerns and marketers’ needs of targeting prospective customers. That is why it has introduced Facebook Conversions API as a game-changing opportunity for businesses.
With the traditional targeting methods facing challenges, the Conversions API was incorporated to help marketers/advertisers to harness the potential of first-party data while upholding users’ privacy. This offers precise tracking and attribution of conversions; businesses gain deeper insights about customer behavior and enable them to optimize ad campaigns to achieve ROAS and conversions rate.
Facebook Conversions API empowers businesses to play the game in the era of data privacy playing a major role. By ensuring customers’ trust and delivering personalized experiences without compromising on privacy, Facebook Conversions API helps businesses to embrace the power of first-party data and embark on a new journey of growth, innovation, and customer satisfaction!
Happy Advertising!
