More than a half (57%) of consumers say social media like Facebook impacts on their shopping decisions.
Thus e-commerce stores are taking this fact into account and have been actively implementing the integration process of their platforms with social media. So, Shopify does the same.
Shopify is an all-in-one e-commerce solution that allows ambitious entrepreneurs like you to set up an online store and sell products, goods, and services online. It is a scalable online platform with tons of built-in features.
A few years ago, Shopify released an app called Shopify Facebook Store that allows merchants to set up a fully integrated store on Facebook. According to the analysis run by Littledata where 1 407 Shopify stores were surveyed in May 2020, the average revenue per customer for Shopify was $72. While anything more than $149 per customer would put you in the best 20% of Shopify stores, anything less than $33 would place you in the least profitable stores. Now, you can imagine how your income from Shopify can range.
Marketers continue to pour billions of advertising dollars into e-commerce Facebook ads, and for good reason — if you get it right, they work. It’s a great place to start your marketing efforts.
After surfing the web and analyzing the successful experiences of many entrepreneurs whose income is more than $1 000 per month in their Shopify Stores we have created this ultimate guide for you.
In this article, we would like to share with you a story of an experienced entrepreneur Manuela Lasry who used to hit $1 000 per month with her Shopify apparel store, Classy RRadical. Manuela sells edgy women’s wear. She runs her ads on Facebook and Instagram. She has started with $5/day targeting 5-10 single interest-based ad sets. later on she switched to 5 ad sets which cost $25/day. This way she could increase the number of visitors to a bit more than 4 000 per day what provided sales of $1 000 per month.
The basic premise behind Manuela’s strategy is to use one round of Facebook ads to drive traffic to her website in order to collect data from those website visitors. Then, she groups the data into custom audiences and sends a second round of Facebook ads (this is called retargeting) to convert visitors into sales. We’ll go through each of her steps below, in full detail.
Getting Started with a Shopify Facebook Store
Creating your new Shopify Facebook Store is relatively easy, especially if you’re already familiar with Shopify. It’s important to consider the difference between “owned” and “rented” web properties. If you build your own website, that’s an “owned” property. You call the shots. You decide the strategic direction.
A Facebook page is “rented” (even if it’s free). If Facebook decides they want to shut you down for any reason, that’s their prerogative. Maybe they decide to disable Facebook pages for strategic reasons. Maybe they want to start charging $1 000/month for one. Neither is likely, but the point is the same. You don’t own your Facebook store.
Look at this quick reference for the necessary steps to set up a Shop on your Facebook Page.
How to Create Your Facebook Pixel
There is an algorithm for creating a Facebook pixel. Let's look at it step by step.
Facebook pixel is a code that you place on your website. It is an analytics tool that allows you to measure the effectiveness of your advertising by understanding the actions people take on your website. You can use Facebook Pixel to make sure that your ads are shown to the right people. The app will allow you to find new customers or people who have visited a specific page. Thus, you can drive more sales and set up automatic bidding to reach people who are more likely to make a purchase.
There are several steps you have to take in order to install the Facebook Pixel to your Shopify store.
- Go to your Facebook Pixel tab in Ads Manager.
- You can name your Pixel. Keep in mind that there is only one pixel per account. The name of your pixel should represent your business.
- Do not forget to agree to the terms before creating Facebook Pixel.
There are few more steps to take in order to place the Facebook Pixel to your Shopify account.
How to Add the Facebook Pixel to Your Shopify Store
- Before going on you need to get your pixel id. You can do that on the Pixels page in Ads Manager. Click "Actions" then view the code.
Next, the new window will pop up where you will find a string of 15 numbers. That is your pixel id. Copy this id.
- Find Online Store on your Shopify admin dashboard and find the preferences tab.
- You should find a field called Facebook Pixel. You can do that if you scroll a bit down. Past the copied pixel id into this field. Do not forget to save all the settings once you are done.
How to Use the Facebook Pixel on Your Shopify Store
Once the Facebook pixel is added to your Shopify store you will be able to track your traffic. The customers' use of your Shopify store and their conversions will be recorded. You can use Custom Audiences or Custom Conversion options to track your records.
Custom audiences use the Facebook pixel to track your store visitors who are on Facebook. The power of custom audiences is that you can customize your audience based on what pages people visit. For example, you can create an audience based on your website visitors, or even on people who visit specific web pages.
How to Create Custom Audiences
- There is an "Audiences" tab in Ads Manager which you have to click on.
- Click Create a "Custom Audience".
- Choose "Website Traffic".
- Set parameters. You need to name your Custom Audience and then click on "Create audience" button.
Custom Conversions
Custom conversion is used to track specific actions people take on your Shopify store.
The first way to use custom conversions is if you've added the Facebook base code without standard events. Just leave the code as-is and create custom conversions using URL rules instead.
- Go to "Custom Conversions" in Ads Manager.
- Click "Create Custom Conversions".
- Enter the URL or part of the URL of where you want to track this custom conversion.
- The next step is to choose the category that best fits what you want to track.
- On the next page, enter the name and description of your custom conversion.
- In order to track the value of the conversion enter into the box below. It will allow you to track the value of the transaction.
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- The last step is to click "Create" and you are done.
How to Create Ads
- You can create a Facebook ad for your Shopify store here. Another way to create add is on Ads Manager under Favourites in from your Facebook homepage. Click "Create Ad" under the Pages menu.
- Choose your ad objective. If you are looking to send more traffic to your website, use the objective called "Send people to your website". To increase conversions you need to choose the conversions objective.
- The next step is to select your target customers. Facebook allows you to target your audience based on age, gender, interests, and much more. This step allows you to select your custom audience.
- The next step is to select the placement of your ads. Facebook usually recommends setting the placement to automatic. Otherwise, you can choose the placement you want.
- Next, you have to choose a budget and the ad schedule.
- Here you will start to create the ad. You should select the image you will use for the ad. Enter advertisement text. Do not forget to give a link to your business profile.
Manuela has a store with many products, so she opted for a carousel ad to promote a specific selection of clothing items. The pieces don’t necessarily have a similar aesthetic, but the selection is curated to be suitable for a variety of moods and occasions.
- Preview before posting your ad. Once you are happy with how your ad looks click Place Order.
The first time you place an order, you'll be asked to enter your payment information.
How to Check the Report of Your Facebook's Ad Campaign
One more step to learn is how to check the data from your Facebook ad campaign. There is also a video tutorial about how to customize data from your ad.
- Go to Ads Manager.
- Click on the campaign you want to get insights on.
- Click on the "Ad Set Name".
- The next step will allow you to get some infographics. You can get a report on Performance, Demographics, and Placement.
At this point, when you have all the data in your hand you should carefully analyze the features of your potential clients. It is important as you will use analyzed data to create Lookalike Audiences (LLAs) and start retargeting everyone who took a specific action on your ad or website.
Do you know how to interpret data from your Facebook ad campaign?
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How to Create Lookalike Audiences (LLAs)
- Create Lookalike Audiences Based on Custom Audience
An LLA allows you to target new users that share the same characteristics as your audiences. Create your LLA by navigating to the same section where you created custom audiences in the Ads Manager.
To create your LLA, you need a source, which will be the custom audiences you created in the previous phase. First, click on other sources and select a custom audience you created. You’re going to create lookalike audiences for all of them, so it doesn’t matter which one you start with.
Facebook takes a while to populate the lookalike audiences, so batch this activity to have them all ready at once.
The second step is to select the location of your LLA. The source audience needs to have a minimum of 100 unique people from the same country in order for Facebook to create a custom audience.
You can only create 1 lookalike audience per country.
This is the part that trips up most people creating lookalike audiences for the first time.
The percentage scale ranging from 0-10% defines the size and similarity of your LLA to your custom audience. The closer to 10%, the larger the audience and the less similar it will be. In other words, the wider your net.
At this stage, you should be in the range of 1-5%, depending on the country you are targeting. The larger the population of the country, the lower the percentage.
Manuela is targeting people in the Netherlands, which has a fairly small population (17 million), so 5% is a good starting point. If you’re targeting a country with a larger population like the United States, start with 1-3% (relatively smaller but more similar).
Once your LLAs have been populated, you’re all set to start running campaigns and testing your freshly created audiences. Create a campaign with traffic set as your objective. This campaign will be identical to the first campaign you set up.
The only difference is that you’ll be changing the audiences in the ad sets with all your LLAs including website visitors, content views, and add to carts. Keep the budget the same at $5/day. According to Facebook, you should run these ads for at least a week before killing them. However, if you see that they are performing really poorly, kill them sooner.
Why are we creating ads with LLAs? Why not go right into retargeting after the first set of ads to get website traffic? The reason is two-fold:
1. You need to test the various LLAs (website visitors, content views, add to carts) before you start retargeting them to collect the right data.
2. Targeting new users using LLAs will give us a larger pool of potential customers and more data to later retarget everyone.
The key metric you want to be looking at here is still CPC. Although at this stage you should start bringing in some sales and at the very least breaking even on your Return on Ad Spend (ROAS).
Lookalike Audiences go stale over time. When you start to see performance declining, refresh your LLAs by deleting them and creating new ones, every three months or so.
How to Start a Retargeting Campaign
At this point, you’ll have approximately a month of conversion data collected, and it’s time to start retargeting everyone who took a specific action on your ad or website.
- Start a Campaign to Retarget Potential Customers Who Took an Action
You’re going to set up a campaign to retarget everyone who took an action on your website, excluding those who have already made purchases. These actions have all been tracked as events with your Facebook Pixel, so you have a lot of valuable data stored.
In order to retarget everyone, you’ll be using the custom audiences you’ve already created. The custom audiences will update automatically, as the Facebook Pixel continues to fire every time someone takes an action on your website.
Navigate to your ads manager and create a new campaign. This time, you want to click on conversions as your objective, since you are going for the sale.
Now, just because you’ve selected conversions as your campaign objective, it doesn’t mean your ads are optimized for the conversions you want. You have to choose the type of conversion:
The most logical type of conversion is a purchase. However, according to Facebook you need to have at least 15-25 conversions per week for the specific conversion you’ve selected, and more than 100 for optimal performance.
At this stage, you’ve already created the custom audiences you’ll be using. However, you want to edit the audiences to exclude people who have already made purchases.
Navigate to your audiences and click on the custom audience you want to edit and select to exclude people who purchased.
- Set up Optimization and Delivery
The optimization and delivery for your conversion campaign will be different than it was for the traffic campaign. Changing the optimization to conversions (as Facebook recommends) may result in fewer link clicks, but more conversions, which is what you want.
- Set Your Conversion Window
The conversion window is an important feature to understand. Think about the duration of time it takes for a potential customer to take your desired action. How likely is it that someone who first sees your ad will instantly make a purchase?
Consider that they might be on their commute when they first see the ad. Despite the fact that they’re interested, they won’t be able to make the purchase. But three days later they might be in the ideal situation to do so.
In regards to the budget, for conversion campaigns you want to allocate double the budget that allotted for the traffic campaigns. This is due to the fact that a conversion will cost you more.
The most important thing here is to change the ad copy. Include an incentive like a large discount, in order to finally close the sale. (This is why including a discount in your initial ad isn’t always a great idea.)
Keep the ad images the same as your first round, since you’re targeting people who have taken interest in your selection of products, but haven’t made purchases yet. So essentially, you are using the same product images, but offering an incentive to revisit your site and make a purchase.
Conclusion
It is always difficult to estimate how much money you can make with an e-commerce store. While there’s no guarantee to make money, there’s also no limit on the amount of money you’ll be able to make.
It doesn’t matter whether you’re looking to earn $10,000+ every month, or you’re just trying to save up some extra cash for a rainy day. As long as you’re running your e-commerce business effectively you’ll be able to reach whatever financial goals you set for yourself.
