DROPSHIPPING ACADEMY – Shopify’s Facebook ADS tracking integration is hurting your business. Here’s how to improve it.

Shopify's Facebook ADS

Source: https://disruptivedigital.agency/

If you are one of the 600K+ active Shopify merchants using Meta’s native advertising integration with your website, you may think you’re following all of the best practices required to drive sales on your website using Facebook and Instagram ads.

However, unbeknownst to many marketers, this out of the box solution is likely significantly hurting your ad performance, especially in a post-iOS 14 world.

The impact of using this solution can be catastrophic in some cases. 

For example, we’ve seen some brands wasting twice as much money to acquire a new customer as they should have been because they were using Shopify’s integration with Meta.

When brands switch to a better integration though, we’ve seen improved metrics across the board that come close to pre-iOS 14 levels, including:

  • Lower CPM’s
  • Higher CTR’s
  • Lower CPC’s
  • Lower CPA’s (both in Ads Manager and in your profit and loss statement)
  • Higher ROAS (both in Ads Manager and in your profit and loss statement)
  • Increased overall revenue (due to increased investment capacity from better performance)

Spoiler Alert: 
At a high-level, the Shopify native integration doesn’t provide as much of the data as it actually has available for Facebook to use in their ads optimizations. 

Because Facebook recommends at least 50 conversions per ad set per week, every unused data point can impact your ability to drive success efficiently on the platform, especially in a post-iOS 14 world.

This post will:

  • Explain why Shopify’s native Meta integration for measurement and optimization is broken
  • Showcase what an optimal integration looks like
  • Share a case study of the impact a best-in-class implementation can have on ad performance
  • Give three alternative ways to improve performance instead of utilizing the native Shopify integration

Shopify’s suboptimal integration with Meta

It’s easy to understand why most advertisers would think they’re getting the most out of their Facebook data tracking using the native Shopify integration.

https://disruptivedigital.agency/shopifys-facebook-ad-tracking-is-hurting-your-business-heres-how-to-improve-it/

The above setup is what all Shopify users are greeted with when they connect their Facebook data to the ecommerce platform. The language makes it sound like you are doing everything possible to ensure maximum data sharing.

To further provide confidence you’re getting an optimal integration, Shopify also states this preference allows you to “Get the best possible results. This setting is continually updated with Facebook’s latest advertising technology, and shares the most data with Facebook.”

What more could possibly be needed that Shopify isn’t supplying to Facebook if I have my preference set to Maximum?

The challenge is that while Shopify’s solution checks all of the boxes on Facebook’s data solutions, it doesn’t max out those solutions for optimal success, in particular the Conversions API, otherwise known as CAPI.

You might think turning CAPI on alone is enough. In fact, if you’re getting ads like this from Facebook and clicking through to their landing page, you’d think you’re doing everything right with Shopify’s integration and there’s nothing more left for you to do to improve your performance.

https://disruptivedigital.agency/shopifys-facebook-ad-tracking-is-hurting-your-business-heres-how-to-improve-it/

However, this isn’t the case.

To use an analogy, Shopify’s integration (and Facebook’s ad campaign) makes it appear as though CAPI is like a simple light switch that can either be turned on or off. 

In reality, CAPI acts more like an advanced floodlight with a dimming capability. While your light is technically on with Shopify’s integration, that light’s area of exposure is limited and in some cases, on its dimmest setting.

Turning that light on to its maximum exposure and brightness can lead to significantly better results for your brand.

The impact of shifting from Shopify’s native CAPI to an optimal integration (case study)

What kind of impact can you see by shifting away from the suboptimal Shopify-native CAPI to a better solution?

Below is an example of one brand we worked with that helps illustrate how shifting away from Shopify’s native CAPI to a better integration dramatically improved their performance.

After retooling and maximizing our CAPI integration, we immediately saw:

  • CPM’s drop by 18%
  • In-Platform CPA’s drop by 33% with a 5% increased investment
  • Overall CPA’s out of Facebook drop by 15%
https://disruptivedigital.agency/shopifys-facebook-ad-tracking-is-hurting-your-business-heres-how-to-improve-it/

These improvements in performance allowed ourselves and the client to have more faith in being able to scale Facebook again in a way that wasn’t possible since iOS 14 initially rolled out.

Two elements required for an optimal CAPI integration (that Shopify does poorly)

So why is the Shopify integration so poor at tracking conversions?

What did this new integration do that Shopify doesn’t and how can you maximize your CAPI’s integration as well?

For a best-in-class integration, you need to ensure the following two components are happening with your CAPI implementation:

  • All of your data is being shared with Facebook and processed properly
  • Your data is being matched effectively to a Facebook user’s account, otherwise known as Event Match Quality (EMQ)
    • EMQ scores are calculated by “looking at which customer information parameters are received from your server, the quality of the information received and the percent of event instances that are matched to a Facebook account.”
    • This score is then used to assess whether you’re sending the right customer information to match your events to a Facebook account and whether you have set up your customer information parameters correctly. Customer information parameters help you match your events to a Facebook account so you can attribute conversions to your ads and deliver them to people who are most likely to make a conversion.

For those using the Shopify native solution, the integration with Meta misses the mark in both instances.

On the data processing side, Shopify misses out on sending a lot of information to Facebook because of the way their integration has been built.

At a high level, the Shopify mechanism for CAPI isn’t a true server side solution.

Instead, the solution created for this native integration appears to only collect certain data from the browser itself and then send it back to a dedicated Shopify server to be sent to Facebook.

This severely limits how much data Facebook is able to see and process as part of its ad optimization system.

From an event match quality (EMQ) perspective, Shopify does a really good job of sharing personally identifiable information like name and email. In fact, you may end up seeing high EMQ scores in Facebook’s backend because of how well they do passing back this data.

However, the EMQ score you typically see can be misleading.

This is partially tied to the first reason shared: Shopify sends less data overall, albeit with a higher match rate. 

However, higher match rates, doesn’t mean better performance. For example, would you rather match on 40 out of 50 events or 75 out of 100 events?

The second reason is because Shopify struggles with passing back two of the most important and overlooked parameters: the click ID and the browser ID.

Unlike parameters like email and name which require Facebook to find and match you to their user database in order to fire, the click ID and browser ID can always fire from an ad click without matching on a user’s exact identity. 

While this data isn’t 100% as accurate as identity based data, Facebook can still do a good job of probabilistically trying to identify that user based on similar traits (such as the device or IP address they are on).

(For the technical crowd, these two parameters represent browser cookie values: The click ID is created when a user clicks on an ad on Facebook and ties that interaction to the user. The browser ID is a cookie that is saved by Facebook over the user’s browser.)

Together, these two parameters provide a near-direct link for Facebook to connect a user to their ad activity in a way that name and email alone can’t provide.

Ironically, Facebook claims the click ID and browser ID are low priority parameter events which is why they don’t highly factor into the EMQ score. 

For example, you’ll notice in the below image from an advertiser using the Shopify native integration that click ID and browser ID are nowhere to be found for purchases on this account despite this brand having an 8.9/10 EMQ score. 

https://disruptivedigital.agency/shopifys-facebook-ad-tracking-is-hurting-your-business-heres-how-to-improve-it/

(Note: this is an extreme example of no click ID or browser ID being tracked, but still showcases how limiting the current Shopify integration is and how misleading the EMQ score can be)

However, we’ve found these two parameters being passed through for all events where possible are crucial to success in a post-iOS 14 world.

Without having click and browser IDs, Facebook can miss out on prior sessions with your website from ads and is limited to a 7-day lookback window. For example:

  • Without click ID and browser ID
    • Facebook might only be able to see a purchase that happens in the same browser session of the click.
    • The purchase paths Facebook can track from ads are severely limited.
  • With click ID and browser ID
    • Facebook can track someone who for example, adds to cart on day 1 of a click then goes to another browser and makes the purchase 7 days later.
    • The purchase paths Facebook can track from ads can be more robust leading to greater signal and greater performance for your account.

Needless to say, adding these parameters in can make a massive difference between mediocre and great performance.

Three solutions to improve performance

If you’re concerned you’ve been leaving money on the table because you’re still using Shopify’s native integration, there are thankfully three paths you can take to migrate away from this subpar solution and improve your ad performance.

  • Implement CAPI Gateway: The Conversions API Gateway is a code-free, self-service setup option available in Meta Events Manager. It enables you to connect your website to Meta by installing a package on your cloud service server instance. You can learn more about the Conversions API Gateway here.
    • Pros:
      • Mostly free, you just need to pay server costs.
      • Takes 1 to 4 hours to implement.
      • Auto-updates to new versions of CAPI.
    • Cons:
      • Piggybacks on your pixel data so while your data will be better than the native Shopify integration, you’re still getting the bare minimum version of what CAPI can offer.
      • Certain events could get blocked by ad blockers because CAPI gateway simply sends your pixel events to a parallel endpoint on your domain.
      • Requires a cloud server provider.
  • Direct integration: For increased control over your integration process, you can also build a direct integration with the Conversions API, which requires a developer. Learn more about direct integrations on Meta for Developers. If you want a more customized experience, you can also create personalized setup instructions in Events Manager and send them to yourself or your developer.
    • Pros:
      • Free to implement if you have a developer on your team.
      • Fully configurable to your needs which means you can build a best-in-class integration.
    • Cons:
      • Takes 2 to 4 weeks to implement.
      • Requires infrastructure necessary to send your events to Meta in real time.
      • Requires someone to maintain the integration.
  • (RECOMMENDED) Use a best-in-class 3rd party integration partner: Using a best-in-class partner who specializes in CAPI integrations can help you get up and running quickly so you can start sending web events directly from your server, without having to edit your website’s code.
    • Pros:
      • Follows best-in-class integrations to provide optimal CAPI integration
      • Can require minimal install work as partner handles
      • Constantly upgrading to best-in-class CAPI integration as new updates are made to improve performance
    • Cons
      • Can incur more costs than CAPI Gateway
      • Might not be as configurable as using a direct integration

While it can be slightly more expensive to use a 3rd party partner to set up CAPI, we’ve found this approach has been the best path for most clients. 

Using a partner ensures your integration is always ahead of the curve when it comes to Facebook’s latest releases and if something goes wrong, you have support to help.

Although Facebook has a list of partners you can work with for your CAPI setup, it’s hard to assess the good integrations from the mediocre ones. For example, Shopify is listed as a partner here despite the limitations of their setup.

For more advanced advertisers with a strong dedicated development team though, setting up a direct integration can sometimes be a better option because they can tailor your implementation to the exact needs of your business.

Looking ahead

The Shopify CAPI native integration has been around since 2020 and while it has seen modest improvements in the last 2+ years, it is still nowhere near an optimal solution for advertisers to drive success with their Facebook ads in a post-iOS 14 world.

By now, one would hope that Shopify and Facebook would improve the integration as it would be better for both of their businesses. 

Facebook would likely see increased investment from the 600K+ Shopify merchants using the native integration with better ad performance. Shopify’s GMV would grow as merchants could now advertise with scale more effectively again.

However, merchants shouldn’t wait around for this change to happen and are likely better off deploying a best-in-class integration instead as you will always have the latest and greatest version of CAPI available to supercharge your performance.

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