Marketers Warm to Meta's Advantage+ Commerce Tool While Promotional Ads See Tepid Adoption

With signal loss increasing and marketers exploring transaction data as an alternative identity currency, platforms have been amping up their commerce-related tools for marketers. At Meta, advertisers have been slow to adopt its promotional ad units, introduced last May to make it easier for shoppers to find deals and generate lower-funnel metrics for brands. Its artificial intelligence-powered Advantage+ Shopping Campaigns tool, however, has been gaining more attention, despite broad concerns about AI-powered buying tools. Direct-to-consumer agency DigiShopGirl Media has increased its media spend on Advantage+ by 40% year over year, with momentum gaining in the second half of 2023. “We've now found that if we do a dedicated structure by types of product families, such as a shoe campaign versus a top campaign, the algorithm finds customers who are interested in each type of product,” said DigiShopGirl founder Katya Constantine. Signal loss is spurring walled gardens to aggressively promote their ecommerce ventures in order to show that ads drive conversions. At the same time, advertisers are moving from an audience-focused targeting approach toward a sales- or conversion-focused targeting approach—which they can accomplish through Advantage+. Some buyers are still hesitant over Meta's data handling, however. Conversion-Based Tactics Are Pressuring Marketers Out of Great Creative Ideas The tool, introduced in August 2022, uses AI to automate the campaign creation process—Meta said it can automate up to 150 creative combinations at once—and finds Meta audiences by using machine learning so that buyers can learn quickly what works in their campaigns. Meta studies show that Advantage+ can lower cost-per-purchase conversion by 12%. Advantage+ campaigns for brands at agency Collective Measures have outperformed standard shopping campaigns, keeping CPMs (cost per thousand impressions) lower while driving traffic to sites, said Ronald Grisha Bornsztein, associate director of performance media. On average, Advantage+ campaigns drove a 160% higher return on ad spend in 2023 than standard shopping campaigns on Meta, with the Advantage+ average CPM ranging between $5 and $5.50. “That is an improvement from where we were in 2022,” said Bornsztein. “CPMs back then were $1 to $2 higher, on average.” Brands have previously noted concerns with Meta's Advantage+ product for its limitation in finding new audiences, as well as more general concerns about Meta grading its homework. “Our AI tools for advertisers are also driving results, with Advantage+ Shopping Campaigns reaching a $10 billion run rate and more than one-half of our advertisers using our Advantage+ Creative tools to optimize images and text in their ads creative,” said CEO Mark Zuckerberg during the company's third-quarter-2023 earnings call. Promotional ads underwhelm Meta's promotional ad units let brands run ads with special discounts so that shoppers click through to brand sites to claim offers. The tool could be particularly crucial during holiday seasons, such as Black Friday, when advertisers target shoppers on social media platforms with promotional messaging to click through to their websites, generating first-party data. A hospitality brand at marketing company Horizon Next has been seeing success from using promotional ads to target people with exclusive offers and send them to its website to drive revenue and bookings. At the end of last year, the brand noticed that site-retargeting performance slipped and its ROAS became less efficient by 33%, according to Alex Weber, associate director, social strategy at Horizon Next. Although the brand was driving cost-effective traffic to the site, audiences weren’t converting. The agency then implemented a retargeting strategy for the hospitality brand to capture cart abandoners and frequent shoppers in order to improve ROAS. Once the retargeting strategy rolled out, the new audiences outperformed ROAS benchmarks by nearly 59%, said Weber. He didn't share specifics. Drop-off at shopping carts is an issue for marketers, while other brands are hesitant about using the tool due to the potential loss of valuable website sales data to Meta. “One of the biggest problems [in] ecommerce is the drop off at the shopping cart,” said Amy Luca, executive vice president and global head of social at Media.Monks. Several friction points—such as getting people to enter their credit-card details or type in their address—can hinder people from completing a purchase. “It gives a consumer a pause and makes them think, 'Do I really need this?'” she said.

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Marketers Warm to Meta's Advantage+ Commerce Tool While Promotional Ads See Tepid Adoption

One agency increased media spend on Advantage+ by 40% year over year

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Trishla Ostwal