Ep 605: Meta Attribution Change – Why ROAS Dropped 40%

Meta implemented an attribution change. Mid to late March, I've seen it rolled out for different accounts at different times, but essentially what happened is Meta's redefining what is counting as click attribution and what is now engaged to your attribution. How important is social proof on your ads at this point? It's still just as important. You have to cut the turns with the fact that your benchmarks are going to have to change, and you're going to have to look at your Shopify revenue, your commerce revenue, whatever platform you use to track revenue. And you kind of need to work backwards from there and find out what your profitable and the worst start is the Meta Attribution doesn't matter. It just matters how you understand where the money is going and where the money is coming from. Today is all-killer no filler. I am Eric and I am here with Chris Richards, Account Strategist extraordinaire over at Pilot House. Welcome to your first time on the D to C all-killer no filler podcast, Chris. Thank you so much for having me. It's a pleasure to be here. So it was about beginning in March or maybe mid-March. I was a bunch of my operator channels that I'm on of people that are running ads heavily. They erupted with a lot of consternation wondering what the hell happened to their ROAS numbers or their numbers on platform. What happened? I take it. There are a lot of people that are heavily focused on Meta in those sickle seconds. This is a meta thing. Yeah. Yeah, it was in case anyone doesn't know, Meta implemented an Attribution change. They're saying it was mid to late March. I've seen it rolled out for different accounts at different times, but March 18th kind of seems to be the cutoff date. Essentially what happened is Meta's redefining what is counting as click attribution and what is now engaged through attribution. So before any clicks that happened on your ad, it would be a like, a comment, a share, or clicking through to website that was counted under the seven day click attribution. What Meta's done now to be more in line with MTAs or like GA4, is that now click solely counts when it is a link click through to website and everything else that was previously in the seven day click bucket has now been shifted over to what they're now calling engaged through attribution, which is formerly viewed through attribution. Why do you think they would have done this? There's a couple of reasons. The primary one that Meta is giving to us is that it is more in line with MTAs such as North Beam and Triple Whale and it's more aligned with Google Analytics as well. In reality though, it's tough to say sometimes like Meta is not the first time Meta has gone through attribution changes. Obviously the famous one is back in 2022 to 2023 when iOS 14.5 came out and there were huge changes to the attribution, but right now it does seem to be the trying to standardize it a little bit more, but at the end of the day like attribution can be a black box and what goes on inside that sometimes like we just don't know or we don't know the reasoning behind it either. So by splitting it out, you are getting a little more data. That's what it it almost seems like against Meta's patterns in some way right where they want generally it to be a bit more of a black box. They want AI to be doing it more for you, but in this case they're breaking out these two kinds of engagement in a way that allows you to audit things a little bit more closely and actually get more data. That's a good take on it. My theory and like what is kind of like becoming apparent the more that we're getting distance from that March 18th date is that they're really pushing for this new engage through attribution. So now instead of going off of seven day click one day view, advertisers now have the option to do seven day click one day view and one day engage through optimization and Meta's putting a lot of eggs into its engage through basket as being more incremental and they're trying to push advertisers to opt that into that as opposed to seven day click, especially for advertisers that are seeing dips like you mentioned into their CPA or their home platform, Roas, they're really touting engage through as this sort of be all attribution. That's really going to help brand scale and whether or not that's the case is being kind of proven out brand by brand. We can do our own incrementality test to see, but it's not the case for every brand and I think it's important that like you need to test it out yourself. So just take me back to the day what like you sit across a number of campaigns. What did what did you basically see on platform? On platform, we typically saw conversion rates and CPAs both drop CVRs were dropping CPAs were rising. Their proportions are pretty similar. The average that I'm seeing at the agency is anywhere between 30 and about 40 to 45% fall off for each of those, but again dependent on how much your brand was leaning into those in what are now engaged through KPIs now that can change. So for example, if you had like a celebrity founder and you ran a lot of video ads and those ads are getting tens of thousands of likes hundreds of comments and people sharing it left and right or your brand that provides really strong value apart from like your own products, trying to value to your customers. Those are like getting a lot of engagement before we would see that fall under the click through attribution and click through would look great, but now that's suddenly been removed. So if you are a very social proof heavy brand, that all of a sudden has just been thrown out the window and you don't know where your attribution is gone. You start spinning your wheels a little bit trying to find traction. When in reality, you're never going to get that traction back. That just doesn't exist in your attribution model anymore. Conspiratorally, I wonder, all these platforms are all trying to replace each other in a way. So if eventually a lot of your shopping actually takes place on meta, if they launch a marketplace or something like TikTok shop, then they really would want to have those two signals separated because they engage through you're all staying on their platform, which is ideal for them, right, versus link, which is like they begrudgingly send you to a link click because they get paid for it and it's good for you and your brand. But I could see that that maybe conspiratorially, maybe that's why they want to break those things out. It's definitely a possibility. And like that does work for a lot of brands, especially brands that are fortunate enough to enjoy a lot of one day click conversions or a shorter customer journey than some other brands. But say if you're a brand that requires multiple touch points to kind of get you over the line and requires multiple touch points across different channels, that's obviously going to negatively impact you and there's just no real way for like what men is doing now to improve upon that. But again, like you said, if you have a lower AOV low consideration, then this might be a fantastic solution. It might be working better than it was before. But we both know that that's not the case for many, many brands of as majority I would say. Does it diminish the importance or increase the importance? It's funny. I think of the D to C's ad account and we've had this one ad wave actually just recently. If you've been retargeted by us, you might know that we finally have some new ads that are working in our account. But for the longest time, it's one ad and it has so much social proof on it, it has so many likes and it was really hard to to throw it all that we recently have. So it makes me wonder like how important is social proof on your ads at this point? Is it still just as important? I would say it is just as important. Like that's the same thing for myself and across all of my brands. Our top ads, the correlation between what is driving conversions and what is getting a lot of social proof. The Venn diagram is a circle and that's not going to change. It's more so the matter of reporting an attribution, which again, it's not an actual problem. If you are using tools outside of meta to track your data, it's just kind of like meta is grading its own homework. And in this situation, when they change what the marketing rubric is going to be, then it becomes really tough to know if that ad is actually doing well. So say if you have a really strong social proof ad, like you were talking about on DTC, if that started falling off a cliff around the date that I'm talking about, then you kind of know the culprit and you can go back and see, oh yeah, like here's the amount of ads or conversions we were getting on engaged through. Here's what we're getting seven day click. And if you look at those attribution models and compare them, it probably looks pretty similar to what kind of conversion rates you were getting pre-march like that can February. Has it ever made practical sense to run engagement traffic to ads in order to get engaged through attribution or to get comments and likes and shares or does is that ever been a strategy that we've employed or that works? It's something that brands have tested kind of sporadically. It's not something that I've found a lot of continued success in. The issue on platform is when you start optimizing towards those events, that's what meta deems is a measure of success. It doesn't deem purchase conversions as that measure. So if we say that a like or a share is our conversion for that campaign, there's a lot of low hanging fruit out there of people that are scrolling through Instagram, they'll double tap on anything or they'll watch a snippet of a video and scroll on. That's a lot easier to optimize towards for meta as opposed to like say a purchase. And the risk of doing that is that if you start feeding your pixel and feeding your algorithm, that low hanging fruit and that easy data, then it starts optimizing the entire count slowly towards that and it makes it harder to work towards your original objective, which is typically revenue and just overall business growth. Yeah. And I think back to like reading comments on ads or when you're in that area, like quite often, it's lonely people. It's people just saying, you know what I mean? So I can imagine some of that engaged through world are maybe not the people that you do want to optimize towards. I'm sure there's lots of like lucky lose or whatever that like and comment on ads that don't actually buy. Although you were saying it was a circle vendiagram, so maybe not. Yeah. And I think to like that kind of like leads me to like another point is that there is a cost to optimizing towards one or the other and not having like a clear source of truth. Like I mentioned, like meta is creating its own homework at the end of the day. Like we have to take the attribution that it gives us if we're only using meta as our source of truth. We have to take that as gospel. But in reality, like we know that the different platforms have their own attribution models. We know that if we look at like the cross comparison, there's going to be a lot of overlap there. That's why it's just it's so important to have something like an MTA like triple whale to come back to and just like look at that as the source of truth. It's not going to be 100% perfect, but it's going to be consistent. And that's the important thing is that every channel and every platform is being consistently measured across any date range you look at. You know that you're getting the same thing and so you can benchmark accordingly. Whereas on meta, if I go look at March of this year and I look at March of last year, those aren't being compared to apples to apples. Those are two very different things that are being compared and it's very, very hard to say, oh, this is performing much better this year or like Blossom Arch was so much better than this year based on these numbers because those numbers are being judged on entirely different things. Another reason to discount or to take with a huge grain of salt on platform metrics. You mentioned Triple Whale. Shut up Triple Whale. We're actually headed to the Whaleys for the first time this year, D to C is going to be there in full force at the Whaleys with some pilot host folks as well. So we're always happy to shout them out. Talk about why, I guess you've already said YMTA is so important to solve this specific problem, but just practically how do you solve it with Triple Whale? Yeah, so essentially like I said, you Triple Whale has different models that the Pixel all feeds back into the same models and they have a ton of models that you can choose from to look at it based on like your business and your like growth needs, but the benefit there is that it is basing everything on the same sort of grade or the gradient. So if you're looking at say like meta seven day click one day view attribution on Triple Whale, you know the way that's being judged and the way that's being evaluated is the same every single time you look at that and you know it's impartial, which is like I think the important thing. And the same thing goes with Google or TikTok, snap, axon, like whatever sort of feedback that Triple Whale is getting. It's comparing all of those ads across the same sort of formula on its back end and the same sort of attribution models. That way, you can have a really clear picture of what is actually incremental for the business versus what the platforms want to be incremental and what they want you to think is incremental. So you spend more money on it. Has any of this impact, like you say, it's not a meta change, it's an attribution change, but has any of this impacted the way you're actually setting up and running campaigns? Oh, of course, it's impacting the way that we set up, but it's also impacting the way that we think about campaigns and more so how we talk to clients and talk to brands about setting up our campaigns when we see on platform attribution change particularly for the worst, like in this case, where things do look worse. It's very easy for brand owners and founders to come to us and say, we need to get CPA get down, we need to get cacdown or row as up and we need to do that by enemies necessary. And a lot of media buyers and brand account managers will often panic and they'll start looking for that lowest hanging fruit similar to how the platforms start doing it. And what that usually is it starts feeding into those bottom of funnel retargeting audiences and you start harvesting those and those pools are only so deep. And so if you're going back to that to get your cheap CPAs and your strong row as eventually that is going to burn out and you're not going to have a growth engine in order to scale in the future. Essentially again borrowing from Peter to pay Paul and it waste your money, it waste your time. It's a stopgap solution. And so I think that's the biggest way that we're thinking about it right now is just making sure that no one's panicking. We have a solution. The data on meta is obviously going to look different, but this isn't even like a meta problem in the long term. We know that platforms change constantly like Google changed how they measure attribution back in 2023 when they switched to GA4. I mentioned iOS 14.5 already. These companies are always changing how they do attribution models. And so if we're panicking now, we're going to be panicking in the future. So that's why it's important to just have a long term plan. And if your goal is new customer growth, then we need to have a plan for new customer growth and not just dive into retargeting and existing customers that like the first sign of trouble. So if you are a five to ten million dollar brand with a lean team, how are we looking at this problem right now? Would you with this brand I'm assuming they would probably have an MTA in place? Or would you say just looking off like on platform automation? Yeah, I'm just like if okay, let's do both. Let's do a company that doesn't have MTA in place. First of all, as you say, platforms are changing all the time. So get a multi-touch attribution platform in place. I think that's good advice. But if they don't, how are they eyeballing it? Try angulating right now. Good question. Okay, so for the first one, MTA-free brand, what you're trying to do now is find what good looks like on platform with your new normal. So the sales haven't gone away. They're still there. It's just how it's being reported. And so you have to come to terms with the fact that your benchmarks are going to have to change. And you're going to have to look at your shop fire revenue, rule commerce revenue, whatever platform you use to track revenue. And you kind of need to work backwards from there and find out what your profitable north start is. Most of the time I'm recommending marketing ecosystem ratio or marketing efficiency ratio, MER, that is a very good, very, very simple north star that we can use to measure performance that doesn't take into account platform attribution. For those who are unfamiliar, it's basically you're taking all of your paid spend dividing it by your net revenue from whatever platform that you choose in the monitor revenue. And you find your ratio. And if that is green and you're profitable, then you can scale and you can spend however much you want as long as that ratio is staying the same super, super simple. But what that doesn't take into account is campaign optimization, ad optimization, and what like, you need to have on platform, what you need to have those metrics, say in order to scale those individual assets. It's mostly just good for directional purposes and knowing when you can spend in like, but not what to spend it on, I would say. And then companies with MTA in place is just a matter of selecting the right lens to look at things through and not for good. Exactly. Like a lot of the times, I recommend Triple Wales total impact. Like that's just a tried and true way to look at the data. And I still say like, you do need your MER target or say if it's new customer growth, your end-cack target. And I like to tell brands, give me the least profitable that your brand can be and still be profitable. And let's find the MER, the end-cack from there because that's what you want to do for growth. You want to push up against that typically as much as possible. And that requires a lot of communication with your client, but you still need that MER ratio in order to spend more. But then on expanding on like my previous points, if you have the MTA, then that tells you where to spend. It's not a matter of just spending as much and keeping it below that ratio. It's okay. Now we can look at our campaigns across all of our channels that we own can look down to the ads. And we know that they're being compared on like a consistent attribution model across every single ad in every platform. We can make more informed decisions that way. Does this have impact? Like, you mentioned ecosystem, Rhoass. I know in terms of packages right now, pilot houses focuses on meta and Google kind of being together. Do any of these changes affect, you know, your multi-plat, how you can think about your Omni channel approach? That's the great thing about having a system in place, especially an ecosystem model like pilot house, is that if your ecosystem is working in harmony, then changes like this on meta don't necessarily have that large-scale business impact that it would be safe. You were like managing a single channel. If you're looking at meta as a single channel, you think the sky has fallen. But if you're looking at the ecosystem and you see all your spend inputs and you see your revenue outputs, and that's still within your realm of acceptability, then the meta attribution doesn't matter. It just matters how you understand where the money's going and where the money's coming from. But if you're not noticing any crazy high rises to or drops and say like Google search intent or branded volume, then typically like again, back in this case, where we're talking about meta attribution. If the signals on Google are unchanging, but meta looks like it's getting worse while driving similar amounts of traffic, then that is just another indicator that the sales are still there and you're still getting those conversions. It's just that they're not visible anymore to you. But yeah, it's very important to like have the ecosystem and just know where all your spend is going and where it's coming from. I feel like a lot of these changes iOS 14, 5 and this one, they cause a lot of drama in the beginning. But what they end up doing is force marketers in some ways to go back to the drawing board to get more creative to get more, you know, to go back to the basics of what makes direct response performance marketing branding work. Do you think this is one of those changes that will in the long term pay out well? Are you still a little pessimistic? I wouldn't say pessimistic. I think the cards are still falling right now. It's definitely more in line with meta's previous changes this year in 2025, such as in drama, where they do want things to be automated and they want things to be very simple and consolidated. I think especially when you look at engaged through optimization, like this ties into in drama to really well where within drama, meta is trying to determine which of the creatives is supposed to go to which person at which stage of the consumer life cycle. And some of those ads will probably be used by meta to generate engagement in some sort of way. Again, if we're going off of this now, that generally favors the attribution model that men is trying to push. Do I think long term that it's a better, not necessarily? I think every attribution change that we've had from platforms in my experience has actually made on platform reporting worse. I don't think this is any different. I've actually had some conversations with meta reps in the last few days where they've signaled similar things. I'm not sure if I'm allowed to say this on the podcast, but it's been a more pessimistic vibe than I was expecting from people that actually work at meta themselves. So if the people that are first hand at working at meta are pessimistic, they're saying most brands that they work with have been flat year over year in the first part of 2026. And they're kind of struggling to explain how to work with the changes and with the new attribution and the algorithm. Then that means it's time to take a step back and start looking at third party solutions to track that data so you can at least retain your own control and have a model that works for you versus meta maybe spinning tires trying to find a solution. And then what's your final word for brands that maybe pulled the shoot or really reduced spend or really maybe refocus to the bottom of their funnel only over the last little while because of these shaky results? Well, the first thing I would say is stop and relax. You don't need to touch grass. Touch grass. You can take a deep breath. It looks bad on meta. It's not actually as bad as it is. Take a step back, start running through it checklist. of testing out, engage through optimization. You can look to see if these are driving incremental conversions on platform already through Meta's incremental attribution tab. That's not a replacement for an MTA. It just gives you a bit more of an honest truth from Meta itself. But the second step that I would say is take a step back and go talk to your triple well rep and see what packages they can offer you. In fact, as far as MTAs goes, they're the most user friendly and the most powerful that I've used. And they do a really good job, like I said, providing that consistency, which I know sounds like a broken record, but consistency is just so, so, so important right now. As things change, especially. Yeah, I would also say talk to your media buyers. Again, if there's a bit of a disconnect and chances are, if you're a founder, you might not be talking to your media buyer every day, they're probably feeling a little bit of a panic crunch too. If they're not fully understanding everything that's going on, have a conversation with them. Let them know that it's OK to spend. It's OK to have a little bit higher on platform CPA during this time, especially if you're spending into top of funnel. And find that marketing efficiency ratio that I was talking about, the MER, and find something that works for your brand. And go to your media buyers and say, hey, as long as we're growing and as long as we're spending within this MER, then I don't care if the platform CPA looks like I just care that we're growing profitably. Just to have a few minutes here at the end, any trends you're seeing with accounts that you're working with, when it comes to maybe how they're not thinking about strategy the way they should. I know the sort of strategy side of the pilot house business has been a really successful evolution over the last little while adding that sort of layer of account strategy. And I was wondering if you had any insights about brands who you're working with who maybe aren't having the right focus when it comes to account strategy. Yeah, I will preface this by saying most of my accounts do have a relatively stable strategy, which has been working. But even those accounts there aren't necessarily insulated from these effects. The ones that don't have a longer term strategy, you can see that feeling I was talking about that panic or that fear of things being taken away. It's a lot stronger in the decisions that you're making or being forced to make in certain situations. They might be a lot more shortsighted. And so you're tactically spinning your wheels, trying to get that traction just to find a baseline, trying to reach the old normal that you had. And it's becoming harder and harder to hit that old normal with the way things are going now. And so like I referenced before, if you're trying to do those tactical things to set that baseline, but it's shortsighted. And you're boring from the future. It's going to come back to bite you. And oftentimes you get into what I call a debt spiral, where you're reducing spend, trying to hit your row-ass targets, you're going into those audiences, you know you shouldn't be overleveraging into. And all of a sudden, you find yourself spending $1,000 a day when you used to spend $8,000. And your row-ass is half of what it used to be. And you have no new customers to fill the bucket. That's kind of what I'm seeing from the accounts that lack like a cohesive strategy. Whereas the ones that do have that strategy, a lot of the groundwork has been done previously. And that's been applied to the entire ecosystem. So it's across Google, across Amazon, across TikTok, to certain extents. And that's all tied back to the same messaging. We can see now that even when that it does have hiccups, the other platforms are there. They're all working towards that same goal. And so the effects are a lot less noticeable. And in some cases, like we're seeing growth, you're over here, even despite these changes. Because we have that sort of unified goal and that unified marketing strategy. Very successful first appearance on the All-Killer and All-Killer podcast. I think next time I'd love to do anatomy of a strategy. And kind of dig in. I know strategies-- strategy is one of those words that you say it a bunch of times. It's like add more strategy. But I feel like-- I think there's something really here for our listeners. So let's next time do a bit of an anatomy of what a strategy looks like. It's going to look different for every brand. But just like what goes into actually creating a good account strategy? What do you think? I would love that. Like you said, everyone seems to be saying strategy. It's probably the most popular buzzword of the last few years. It's become almost like a dog whistle for me whenever I hear it. And it's very much something that means a lot of things to different people. But again, we had the pilot host definition of strategy. And I'm a very firm believer in what we're doing. So we'd love to dissect that. Fantastic. Well, stay tuned for anatomy of a strategy. And in the meantime, keep your cool. Get an MTA and just ride this bad boy out. Thank you so much for having me, Eric. [MUSIC PLAYING] Thanks for listening to today's episode. If you're not getting the DTC newsletter, you can subscribe for free at directaconsumer.co. And if you want to learn more about pilot houses, all killer no filler services, take off to pilothouse.co. I'm Eric Dick. And this has been the DTC podcast. We'll see you next time. [MUSIC PLAYING]