Study Finds E-Commerce Stores Must Stop Relying on Facebook Advertising or Risk Financial Ruin

Google Analytics screenshot of actual drop in Apple device sales due to Facebook advertising

Research clearly shows that e-commerce retailers who rely on Facebook advertising risk facing financial ruin if they don’t change their marketing strategy.

Marketing budgets and strategies need to be changed and reviewed, and e-commerce retailers realize that Facebook’s ad performance simply won’t be as lucrative as it once was.

— Tracey Munn

GOLD COAST, QUEENSLAND, AUSTRALIA, March 26, 2022 / — Digital Munn, an Australian-based e-commerce digital marketing partner agency, a Google partner, and a Shopify partner primarily work with e-commerce stores across the United States. By analyzing over 125 e-commerce retailers across 7 different industries, the research clearly shows that e-commerce retailers that rely on Facebook advertising risk facing financial ruin if they don’t change their marketing strategy.

Google and Shopify Partner, Munn Digital, recently completed an 8-month study of the impact on e-commerce retailers in the US following the Apple iOS14 update (and more recently email privacy changes ).
Analysis of 125 e-commerce retailers across the United States, including industries; Hair & Beauty, Nutrition, Fashion, Snacks, Baby Products, Home Goods

Munn Digital, Founder, Chief Digital Strategist and 15-year digital marketing veteran Tracey Munn, led her team of analysts on a follow-up mission to monitor the impact of this update on e-commerce retailers that matter on Facebook to generate sales.
Monitoring over 125 e-commerce stores, the results were nothing short of astounding.
Tracey Munn comments:
“There was an initial impact on e-commerce sales following the Apple iOS14 update, however, we are really seeing the impact from the start of 2022.
Quality Facebook advertising, one that delivers 4x ROAS (return on ad spend), relies heavily on well-structured funnels. This means that cold audiences are targeted at the top of the funnel and warm audiences (those who have engaged with the brand in some way) are retargeted towards the middle and bottom of the funnel.
Those warm audiences and retargeting are where we saw the biggest impact of the iOS14.5 update. »

Impacts on the Facebook pixel and events
Prior to the update, Facebook marketers could create an unlimited number of Facebook Pixel events. This meant audiences could be retargeted based on many behaviors, from visiting a website to time spent on a product, adding a product to cart, clicking a button, and more.

After iOS14.5, pixel events were limited to 8 events only. Some of the campaigns we looked at had over 60 audiences and granular campaigns set up based on previous events. This stopped on update, in some cases reducing retargeting audiences by 70%, with 96% of that audience opting out of tracking.

What the Data Predicts for Ecommerce Retailers
– A staggering 100% was negatively affected by the Apple iOS14 update.
– All retailers participating in the study shared their Google Analytics profiles with other Munn Digital tracking systems.
– Highlights of the study data conclusively showed that:
– Apple devices reported a drop of as much as 30% in Facebook ad retargeting sales over 8 months
– According to industry, Facebook’s highest reported drop in sales from Apple devices was 51.41%
– Samsung sales increased by at least 200% across all retailers
– Stable Facebook campaigns, where audience targeting did not change after the iOS14 update, decreased on average from 6 ROAS to 2.4 ROAS
– ROAS (return on ad spend) decreased across 125 retailers

What should e-commerce retailers do to recover lost sales
Should e-commerce retailers stop advertising on Facebook? Tracey Munn comments:
“I don’t think an e-commerce retailer should stop advertising on Facebook, but should make sure they experiment with targeting options and understand that Facebook retargeting just isn’t what it used to be. .
While Facebook’s results have declined, some retailers are seeing, at a minimum, a 700% increase in YouTube traffic and sales from YouTube ads. Organic sales are also on the rise, as are sales generated by email.
Marketing budgets and strategies need to be changed and reviewed, and e-commerce retailers are realizing that Facebook’s ad performance just won’t be as lucrative as it once was.
Retailers need to expand their marketing efforts to include more channels. »

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Tracey Munn
Digital Munn
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