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Facebook's New Insights Will Help Marketers Win Auctions So More Users See Their Ads

Tool lets brands create more competitive campaigns

Facebook is trying to help advertisers better understand their campaigns. Facebook

Facebook is giving advertisers a glimpse behind the curtain of its marketing platform in order to better understand how ads perform and how they can better compete.

Today, Facebook is introducing Delivery Insights, a tool that will help brands understand how their promotions are performing in Facebook's ads auction. The social media company uses the platform to pair ads with the right users based on price, intent and quality. Delivery Insights allows marketers to see which ads are underdelivering and tweak them to better reach the desired audience size. The tool, located in the "Delivery" column of a campaign or under the "Tools" tabs, is rolling out globally over the coming weeks.

According to Facebook, the new feature should help remove at least "some of the guesswork" that goes into creating high-performing ad campaigns on Facebook while coaching media buyers on what they should consider doing to make sure the ads reach their intended audience.

"We built our ad system to create as much value as possible for people and businesses," John Hegeman, Facebook's director of engineering for advertising delivery, ecommerce and analytics, said in a statement about Delivery Insights. "With this in mind, we're focused on helping marketers better understand how our ads auction works, and how they can improve their results, through an education program we're launching this week. In the coming months, we'll also begin introducing new insights in our ads interfaces to help marketers ensure their ads are shown to the people they want to reach."

With 3 million advertisers competing for the attention of more than a billion users in Facebook's news feeds and publishing platforms, the company says it runs billions of auctions every day in order to pair "the right people with the right ads," according to a blog post published today on its website.

Here's how ad auctions work: Advertisers submit requests for ads and select their target audience, objective and a price bid for each click or conversion. Then, each time Facebook has a chance to show an ad to a person in that audience, an automated auction decides which ad the user will see.

To determine which ad wins the auction, Facebook assigns a total bid value to each ad, which is calculated based on three factors: the advertiser's bid value for the outcome it's looking for, the probability that showing an ad to a person will give the advertiser the desired outcome, and the quality and relevance of the ad for each intended individual

Because the various factors can affect the likelihood of an ad appearing and the price it appears for, Delivery Insights will help marketers see how campaigns are doing and understand what they should modify during the course of the campaign.

"Each time an ad is under consideration to be shown to a person, an auction is happening, and each of these factors can affect an ad's potential to win the auction," according to Facebook's post. "In each auction, the ad with the highest total bid value wins, and winning means the ad gets shown to the person in consideration. This means that an ad that's very relevant to a person could win the auction with a low bid. It also means another ad with similar relevance could win the same auction if it comes in with a higher bid."

Read the full post here.

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