Setting Up Ad Tracking & Conversion Attribution

This is part two of a ten part series in setting up digital ads for your business.

With over 22 years in SaaS, we've managed over $50m in profitable B2B digital ad spend at SaasRise, a B2B SaaS scaling and exit advisory agency. We've distilled crucial lessons to elevate your paid advertising efforts. You can forward this detailed ads guide to your marketing team for implementation or you can hire our team to set up, optimize, and and scale these six channels for you. If you're a SaaS CEOs or Founders with $1M to $100M in ARR and you like in-depth quality growth content like this, apply to join our community. So far we are up to 285 SaaS CEOs & Founders members representing $1.8B in ARR.

All right, let’s jump in to the good stuff…

Welcome back to the second installment of our series. It's time to tackle another common mistake when configuring paid advertisements, which focuses on "Setting Up Ad Tracking & Conversion Attribution."

A big issue happens when you rely solely on native ad platforms like Google, Meta, and LinkedIn for conversion tracking (knowing which ads generates which leads and customers). When managing ads on multiple networks simultaneously because each platform tends to claim credit for conversions they have influenced, resulting in duplicate counting of the same conversion. Both Meta and Google and LinkedIn will claim their platform generated the same sale.

To address this issue, it's crucial to use a tool that will give proper credit.

How to Set Up Ad Tracking & Conversion Attribution

If you're testing ads on a single channel, such as Meta or Google Ads, you can utilize the native tracking provided within each platform's ads manager interface.

To implement this, install the tracking pixel specific to each platform (Meta, Google, LinkedIn, etc.). Set up conversion tracking for each type of desired action (e.g., lead, trial, demo, download) that you wish to monitor and optimize for.

However, when you expand your advertising efforts across multiple platforms simultaneously (Meta, Google, LinkedIn, Bing, Adroll, etc.), it becomes essential to utilize an ad tracking tool like Cometly. This tool helps in accurately attributing conversions across all platforms.

Effective tracking tools integrate with each platform via API, ensuring that all conversion events are reported back to them. This method is more precise and provides platforms with signals to optimize ad targeting, thereby enhancing your reach to potential customers similar to your converters. Over time, this accumulation of conversion data creates a positive feedback loop, yielding improved campaign results.

By using a robust tracking tool such as Cometly, you can effectively track leads and customers by channel, prevent multiple platforms from claiming the same conversion, and sync successful conversion data back into the ad network algorithms for enhanced performance.

Here’s what the Cometly interface looks like for our own ad account (which we use to run ads for our SaasRise community of CEOs/Founders). As you can see, ads drove 79 applications and 5 new paying members for us in June 2024.

You can utilize a tool like Cometly to monitor conversions such as leads, trials, demos, and customers across both paid and organic channels. This enables you to promptly identify which channels are driving results for your business.

Cometly's upcoming version, launching in July 2024, introduces enhanced attribution capabilities. You can assign credit based on first touch, last touch, linear distribution (equally to all contributing platforms), or a U-shaped model (40% credit to first touch, 40% to last touch, and 20% to all intermediate touches). We prefer the U-shaped model, which fully credits a single referring channel and allocates partial credit when multiple channels influence a sale.

Additionally, Cometly currently tracks post-click sales but not post-view sales. We find it valuable to analyze both metrics for a comprehensive understanding. For instance, in June 2024, we recorded 5 sales from users who clicked on an ad and an additional 8 sales from users who viewed an ad and subsequently applied to join our community within 24 hours — totaling 13 sales influenced by ads and 5 directly attributable to ads.

Regardless of whether you opt for Cometly or competitors like Hyros, HockeyStack, Google Analytics, HubSpot, or native ad tracking platforms, it's crucial to calculate Cost Per Lead (CPL) and Customer Acquisition Cost (CAC) for each channel and ad type. These metrics are essential for optimizing ad spend, directing more investment towards effective channels and reducing expenditure on less productive ones later on.

Below are some of the various types of attribution you can use within Cometly. While the standard is first touch attribution, we like to use U-shaped attribution (40% to first touch, 40% to last touch, and 20% to any intermediate touches).

Tomorrow, we will delve into the third most common mistakes in setting up paid ads which focuses on "How to Set Your Initial Test Budget" Stay tuned for more valuable insights!

If you find the resources above valuable and want more content like this, apply to join SaasRise, our exclusive mastermind community for SaaS CEOs and Founders with $1M to $100M in ARR aiming to scale up. Every week, we host five optional mastermind calls where we support each other and share successful strategies for scaling our companies. Throughout the week, we continue this support and collaboration in our private community on Slack, WhatsApp, and our custom platform.

I'll be back in touch tomorrow with part three of this guide to setting up profitable ads for your company...