A few weeks ago, I delivered a presentation on some fresh insights regarding Facebook Lead Ads at Mobile Monkey’s 2019 Facebook Ads Virtual Summit. Facebook offers advertisers two primary options for lead generation campaigns: using Conversion campaigns to direct potential customers to landing pages or utilizing Lead Generation campaigns (with lead ads) to convert leads directly within Facebook.

At nexus-security, our goal was to determine the most effective method. We gathered data, shared our findings, and proposed strategies to empower Facebook lead gen advertisers to extract significantly more value from these campaign types.

Following the presentation, we received numerous inquiries from attendees of the 16,000+ registrants (and those who learned about it later) requesting a recording. Currently, the recording is available through Mobile Monkey (all 10 sessions can be accessed for a very reasonable $49). However, for those who missed it, we’re providing a comprehensive (and free!) summary of the content right here on the nexus-security blog.

Let’s dive in!

Background: Facebook Lead Ads in a Nutshell

Facebook lead ads are well-established (and increasingly crucial in a post-iOS 14 world!). They’ve been around for a few years now. However, in our conversations with Facebook advertisers, we’ve observed that lead ads haven’t gained universal adoption yet. Many advertisers still aren’t maximizing their potential.

What exactly constitutes a Facebook lead ad? Here’s a visual representation:

This ad type comprises three primary components:

1. A potential customer is scrolling through their News Feed. They encounter your call to action—in this case, a “Subscribe” button (though it can be any of eight options depending on your objective) and click it.
2. A form appears within the ad. The prospect fills out the form, providing their information. In this example, it’s just their name and email, but you can include numerous other fields to qualify them further.
3. Upon submitting their information, they become a lead.

On the advertiser’s end, this is how it appears: When setting up the campaign, you select “Lead Generation” as the objective.

At the Ad Set level, you link your Business page, define your targeting and placements, and establish your budget and bidding strategy.

Moving on to the Ad level, things become more distinct. You have your creative elements, ad copy, headline, and eight CTA button options. At the bottom, you’ll notice the “Instant Form” field.

This “Instant Form” is what distinguishes a lead ad. Here, as the advertiser, you specify the information you want to gather from your prospects.

You can achieve this by using a saved form, crafting a new one from scratch, or modifying an existing one. Let me elaborate on each customization option:

• Form Type: This is where you choose to prioritize either lead volume or higher intent. Facebook facilitates higher intent by incorporating a review step, allowing prospects to confirm their information before submission.
• Intro: This section appears at the top of your form, providing prospects with more detailed information about it.
• Questions: Here, you specify the contact, demographic, and employment information you require from your prospects, along with any custom questions necessary for qualification.
• Privacy Policy: Since you’re collecting personal data, linking to your company’s privacy policy is mandatory.
• Thank You Screen: This is where you customize what users see after submission.

To illustrate this in practice, here’s a lead ad from our account promoting our “Hacking Google Ads” guide as a lead magnet:

At first glance, it resembles a standard ad. However, it expands into this nice lead form, featuring an intro explaining the guide’s content and allowing us to ask all the essential qualifying questions.

Finally, we have the personalized thank you screen where our newly acquired lead can conveniently download the guide.

That’s Facebook lead ad creation in a nutshell! What sets this user flow apart? Prospects can provide their information without ever leaving the Facebook app. There’s no need to navigate to a landing page in a new window or endure loading times. This is undeniably the most significant advantage of utilizing Facebook lead ads.

Generating a viable sales lead takes six to eight touches. When you consider all the steps a prospect must go through within your organization to become “viable” or “qualified,” that figure might seem quite modest. Obtaining high-quality leads demands considerable time and effort. Any opportunity to streamline this process grants you a substantial edge.

The Alternative: Conversion Campaigns and Landing Pages

Lead gen advertisers on Facebook have an alternative to Lead Generation campaigns: Conversion campaigns. When “Conversions” is your campaign objective, the goal is to acquire leads. To achieve this, you direct prospects to a landing page where they can fill out a form. There’s absolutely nothing inherently wrong with using Conversion campaigns for lead generation. In fact, most advertisers we engage with indicate a heavy reliance on them to meet their targets. It’s a more traditional approach.

For instance, our nexus-security account utilizes conversion campaigns to promote the same “Hacking Google Ads” guide using almost identical creative elements. As you can see, it’s challenging to differentiate these ads within the News Feed.

Even my tech-savvy mother couldn’t spot the difference!

The key distinction lies in the user flow. Conversion campaigns always involve redirecting prospects to a landing page. As you can observe, we present essentially the same questions and bullet points on our landing pages as in our lead ads.

Again, the primary difference is the physical redirection of the user outside of Facebook.

Intuitively, this might seem disadvantageous. Redirecting to a landing page implies a longer wait time, more steps, and more information to process before a prospect converts into a lead, right? However, let’s consider why this user flow could potentially work in our favor—for those very reasons!

• Longer wait time: Prospects willing to endure a page load before providing their information are more likely to be qualified leads.
• More touches: A prospect who clicks eight times before submitting their information is likely more invested in your brand than one who clicks only three times.
• More information: Prospects who consume more information about your business before converting are more likely to become customers.

The fundamental question isn’t, Are conversion campaigns superior to lead generation campaigns? It’s that Facebook lead generation seems to operate on a spectrum where prioritizing lead volume risks sacrificing quality, and vice versa. It initially appears that conversion and lead generation campaigns occupy opposite ends of this spectrum. Lead ads might generate more leads, but they might be less qualified. Conversely, landing pages might yield higher-quality leads but at a lower volume.

Quite a frustrating dilemma, isn’t it? Or is it? Let’s delve into the data we’ve compiled on these topics.

The Data: Lead Ads vs. Landing Pages

At nexus-security, we aimed to test the hypothesis that, generally, lead ads convert to leads more effectively than landing pages. We also sought to compare the cost of lead acquisition for each campaign type. Consequently, we set out to measure conversion rate and cost per action for both lead generation and conversion campaigns, analyzing data from all nexus-security clients who employed these campaign types within the preceding 60 days. Our dataset encompassed over 3,000 campaigns and approximately $9.5 million in ad spend.

Here are our findings:

Campaigns utilizing lead ads exhibited an average conversion rate of 12.54% and an average cost per action of $17.98. In contrast, campaigns using landing pages showed an average conversion rate of 10.47% and an average cost per action of $13.26. So, despite the higher cost per action, the key takeaway is that lead generation campaigns convert clicks to leads at a 2.07% higher rate than conversion campaigns. This outcome, attributable to the more streamlined user experience, aligns with our expectations!

However, this data only paints half the picture. It reveals nothing about the quality of leads generated by each campaign type.

To assess quality, we sought a lead-gen-focused business with a substantial dataset and accessible CRM (Customer Relationship Management) data, enabling us to evaluate the sales performance of leads generated by each Facebook campaign type. Where could we find such a dataset? Our very own nexus-security account!

We utilized the same 60-day timeframe. To illustrate the dataset’s scope, we accumulated over 40,000 link clicks across lead generation and conversion campaigns during that period. What insights did the data reveal?

Consistent with the customer data, lead generation campaigns demonstrated a higher conversion rate to leads—in this case, an 11.7% higher rate. However, when considering our business’s definition of a “qualified” lead, conversion campaigns emerged as the clear winner.

Conversion campaigns boasted a 5.7% higher conversion rate to “qualified” leads and a 1.4% higher conversion rate to demos. A “demo” signifies a lead requesting a call from our sales team to demo our software. Given the significance of this action for our business, that 1.4% increase is substantial!

We also observed a significantly lower cost per quality lead in the conversion campaign group.

The takeaway? Lead generation campaigns appear more effective overall at converting clicks to leads, while conversion campaigns excel at generating quality leads at a lower cost.

How to Drive Quality AND Quantity from Lead Ads

Recall the earlier dilemma where lead quality and volume seemed mutually exclusive. Given the data, we’ve established that landing pages correlate with higher-quality leads, potentially without sacrificing as much volume as initially assumed. Conversely, lead ads undoubtedly convert to leads more efficiently, but the quality might not be as lacking as previously thought. Perhaps these campaign types aren’t as disparate in performance as we once believed, resembling something like this:

The question, I believe, isn’t how to run campaigns without sacrificing lead volume for quality? Instead, it’s: How can we invert this model and execute campaigns that drive both volume and quality in the same direction?

Let’s explore tactics to help you achieve this! Since lead ads have evolved to offer granular control over lead quality while preserving a seamless user experience, we’ll temporarily set aside conversion campaigns and focus on optimizing lead ads for both volume and quality.

Tactic #1: Target Lookalikes of Paying Customers

It’s logical that to attract leads who convert into paying customers, you need to target Facebook users resembling your existing customer base. Remarketing to your 30-day site traffic is beneficial; creating lookalike audiences based on existing leads is even better. However, building a prospect pool mirroring the characteristics of those who have already purchased your product or service offers the highest probability of generating new leads who will become customers.

Let’s elaborate: Suppose you have three seed audiences: 60-day product page visitors, past webinar registrants, and an existing customer list.

You can hope that prospects resembling the 60-day product viewers will convert, but you can’t expect it because they’re derived from website browsers, not buyers. The same applies to the webinar registrant audience. You can hope your lookalike downloads the whitepaper, reads it, and clicks the free trial CTA, but realistically, you can’t expect it.

Then there’s the customer list. This is where lead ads shine. The streamlined format allows you to prioritize converting prospects into customers rather than just leads. By leveraging lead ads with a lookalike audience based on your existing customers, you’re presenting that frictionless experience to those most likely to be in the market for your offering when they encounter your ad.

Let’s examine creating a customer lookalike audience on the backend. Begin by creating a custom audience, a straightforward process. Navigate to the Audiences tab in Ads Manager…

Click “Create Audience,” then select “Custom Audience.”

Choose “Customer File.”

If you’re a MailChimp user, you can directly import email addresses.

However, most users will select the first option, which involves uploading a spreadsheet.

After uploading your email addresses, allow Facebook one to six hours to build the custom audience. Once complete, return to “Create Audience” > “Lookalike Audience”…

Locate your newly created custom audience in the source field, apply your location targeting, and set your desired audience size.

It’s that simple!

For audience size, I recommend starting with 1%, representing the population segment most closely resembling your existing customers. Adjust upward if your audience is too small.

This strategy is applicable to any campaign type but proves particularly effective with lead generation campaigns. By combining a streamlined lead ad experience with precise targeting, you no longer have to choose between volume and quality.

Tactic #2: Incorporate Animated Creative

By “animated,” I’m not referring to cartoon characters! I’m advocating for bringing your creative elements to life. From personal experience, I can attest that this is the number one recommendation our in-house acquisition team receives during meetings with Facebook representatives. Over the past six months, we’ve implemented animated creative and witnessed improvements across the board—to the extent that we rarely opt for static creative when developing new Facebook ads.

You’ve likely encountered the advice to incorporate video creative countless times, but let me emphasize—it doesn’t necessarily have to be a full-fledged video. Here’s an example of animated creative we’ve employed in lead ads recently:

This is a GIF; we simply animated static elements (more challenging than it sounds, but we’ll delve into that shortly). As mentioned earlier, this has become our standard practice when introducing new ad concepts. We still utilize static creative occasionally, but we predominantly favor short animated GIFs or videos. The performance uplift justifies the additional design effort. Essentially, you’re enhancing your ads with that coveted “thumb-stopping” power. You’re differentiating yourself from the sea of static content within your prospects’ News Feeds.

While GIFs are effective, video still has its place! Although any animated creative can make your ad more eye-catching, only video grants you narrative control, which is crucial for qualifying leads.

What do I mean by “controlling the story”? Imagine you’re a car dealership investing in a 15-second ad slot for an Audi convertible.

It’s a simple concept: a brief clip of the car in motion, showcasing interior features, perhaps with a stylish individual behind the wheel sporting sunglasses. By creating this video, you’re investing in your narrative, which translates to investing in your prospect. This investment is paramount when serving lead ads. Since converting into a lead is already incredibly easy for the prospect, you want to ensure that becoming a customer is equally effortless.

It’s easy for a prospect to spot the Audi convertible in their News Feed, see the “Get a Quote” CTA, and think, “Out of curiosity, I wonder what my monthly payment would be if I financed this. I’ll submit my information.” However, by investing in video, you allow this same prospect to envision themselves behind the wheel. They gain an understanding of the interior features and witness the car’s performance on the open road. This prospect comprehends the product, the “Get a Quote” CTA, and is far more likely to convert.

A Quick Shameless Plug (You’re Welcome!)

Time for a shameless plug!

I’m only mentioning this because I understand the challenges of creating animated ad assets in-house, especially for small businesses, agencies, or even larger teams. At nexus-security, we offer a highly valuable tool within our software that simplifies the process of creating animated creative: Smart Ads. Advertisers need only provide their URL, and our software scrapes their site for images and text to generate dynamic HTML5 ads. In essence, we animate your static creative. Here’s a visual representation:

You can seamlessly integrate your new dynamic ad into your Facebook and/or Display campaigns directly from the software.

Another noteworthy feature within the Smart Ads suite is Smart Video Ads. We’ve streamlined the entire video creation process, providing music options and a drag-and-drop interface for images and copy. The end product is a highly dynamic, engaging video ad ready for implementation in your Facebook lead ad campaigns. This tool empowers you to control your narrative, qualify generated leads, and facilitate the transition from lead to sale.

Tactic #3: Ask the Right Questions (and the Right Amount!)

Lead ads’ instant forms can accommodate up to 15 custom questions and a total of 21 questions. While obtaining answers to 21 questions would provide extensive knowledge about a prospect, including their favorite color, first girlfriend’s name, and coffee preferences, it’s unrealistic and unnecessary. Not all questions are crucial to your sales process. This highlights the importance of asking the right questions in the right quantity.

Let’s examine some additional data. AdEspresso conducted an insightful study a while back, investigating the impact of question quantity on cost per lead within instant forms. Their conclusion, consistent with our theme, was that increasing the number of questions directly correlates with a higher cost per lead. Conversely, removing too many barriers to conversion risks attracting low-quality leads.

This concept isn’t groundbreaking and ties back to the inverse relationship between quality and volume. However, the intriguing aspect is the exponential increase in cost per lead beyond five questions. It seems people are comfortable answering five questions, but asking for one more comes at a price.

While five questions serve as a reasonable benchmark, the crucial takeaway from this data is: Align your questions with the objective of each lead ad campaign and how those leads fit into your sales funnel. Then, minimize the number of questions while maximizing the vital information gathered.

For instance, in a top-of-funnel lead generation campaign where leads are nurtured further by your email marketing team, focus on obtaining names, email addresses, and any other essential information they need. Conversely, if you have a compelling offer and creative, aiming to deliver leads directly to your sales team, ask for information that enables them to segment and engage those leads effectively. You’ll generate a significant number of leads—as evidenced by the conversion rates—but this is manageable if you ask discriminating questions that facilitate pushing those leads through the funnel.

The Key Takeaway

Facebook lead ads remain significantly underutilized. Due to the historical dominance of conversion campaigns, lead ads haven’t achieved widespread adoption. This presents an opportunity for advertisers to capitalize on those impressive conversion rates and generate more leads than their competitors. By incorporating the tactics discussed today, you can generate the right kinds of leads that drive profitability.