Social media has long been an enigma for marketers looking to measure their campaigns’ financial ROI.

“Awareness Metrics” like reach and frequency are all well and good, but how do we know whether the audience actually took action on our brand or product? Fortunately, Facebook’s little-known Conversion Tracking tool can measure just that, allowing us to pin down our Facebook ROI and justify the expense.

Nestled in Facebook’s Ads Manager Tool, Conversion Tracking let’s us measure what action a prospect takes after clicking on a link from Facebook. To do so, it requires a pixel placed on the website you plan on linking to – and this will then send Facebook all the information necessary about the customer’s actions on the website.

The best use for this tool is on forms. Using Conversion Tracking, Facebook not only measures how many people reached by an ad clicked on the link in the post, but also how many of these click-throughs actually resulted in form submission.

And of course it’s a better way to measure advertising effectiveness than clicks alone.

High click-through rates with low form conversions might mean that you’ll need to shorten your form and/or make your website more attractive. But if you have low CTRs with high conversions, you’ll want to look more critically at your Facebook ad and consider changing it.

The tool does away with common misconceptions: high CTR = a successful ad and low CTR = a failed ad.

Most importantly, Conversion Tracking allows you to focus on outcomes. If your form leads to downloading a product brochure or white paper, you can track this – then follow that lead through the sales pipeline via your CRM system. And that leads to the all-important monetary metrics like cost-per-lead, cost-per-sale, and ROI – giving you an apples-to-apples comparison of your Facebook ads with those ads you place in other media, or other vehicles you launch via other channels.

In short, Facebook’s Conversion Tracking is an important tool when it comes to measuring your social media marketing ROI. While it requires a more extensive set-up than most other social media marketing tools, the measurable outcomes are well worth your time investment.