Solved: Meta Ads CTR Drop After Switching to Purchase

Hi there,

Thanks for reaching out!

Happy to give you some of my initial thoughts on the situation with your Meta ads. What you're describing is actually a really common thing to see, and honestly, it's a sign that the system is probably starting to work how it should, even if it feels a bit backwards right now. It's one of those classic paid advertising quirks that trips a lot of people up.

You've basically just told Meta to stop looking for window shoppers and start finding actual buyers, and that's a whole different ball game. Let's get into why that is.

We need to talk about CTR... it's mostly a useless metric.

Alright, let's get this out of the way first. The entire industry has an unhealthy obsession with Click-Through Rate. People brag about it, agencies put it in massive font on their reports, but honestly? For an eCommerce business, it's one of the least important metrics you could track. It tells you how many people clicked, but it tells you absolutely nothing about whether those people are ever going to buy from you.

Think of it like this: You could stand outside a shop on the high street and offer free sweets to everyone who comes inside. You'd get a massive 'footfall rate'. The shop would be packed. But how many of those people are actually there to buy a £1,000 sofa? Probably none of them. They just wanted the free sweets. Your high CTR on 'Initiate Checkout' was a bit like that. You were attracting people who were curious, people who liked to browse, people who might start the checkout just to see the shipping cost. They are the clicky crowd. They're not necessarily the buying crowd.

A high CTR with no sales is just expensive brand awareness for people who will never be your customers. A low CTR that leads to profitable sales is a successful business. I remember one eCommerce client with a subscription box service whose campaigns had what some might call a 'poor' CTR of less than 1%, but they were generating a 1000% Return On Ad Spend. In another campaign for a women's apparel brand, we drove a 691% return. I can assure you, the client didn't care one bit about the CTR on those campaigns; they cared about the revenue hitting their account.

So, the first bit of advice is to mentally delete CTR from your list of primary key performance indicators (KPIs). Your new best friends are Cost Per Purchase and ROAS. That's it. That's what matters.

You've Changed the Algorithm's "Job Description"

The core of what's happened here is that you've given Meta's algorithm a completely new set of instructions. It's not a subtle tweak; it's a fundamental change in objective.

When you optimised for 'Initiate Checkout', you told Meta:

"Go find me people who look like other people who've started the checkout process on my site. I don't mind if they're just tyre-kickers or price-checkers, just find me people who have a habit of clicking 'checkout'."

The algorithm dutifully went out and found a relatively large audience of people who are generally active online, click on ads, and often abandon carts across the internet. This group is large and easy to find, so you get more impressions and more clicks, leading to a higher CTR.

Now, by switching to 'Purchase', you've told Meta:

"Okay, new plan. Ignore everyone else. I only want you to find the tiny group of people who not only look like my past buyers but also have a proven, recent history of actually completing purchases on other websites. Find me the serious buyers."

This is a much, much harder job. The algorithm now has to be incredibly selective. It will ignore millions of people it would have shown your ad to before. It's now looking for a very specific profile: someone with high purchase intent, who matches your customer demographic, and is in a 'buying mood' right now. This audience is, by definition, significantly smaller and more discerning. They don't click on every shiny ad they see. But when they do click, there's a much higher probability they intend to buy.

So, what you're seeing isn't your ad performing 'worse'. You're seeing it being shown to a completely different, more cynical, but ultimately more valuable, slice of the population. The CTR drops because this new audience is harder to impress. The sales should, after a while, increase because they are the right audience.

To put this in perspective, here's a rough idea of how audiences shrink as they move down the sales funnel. For every 1000 people who see an ad, the numbers might look something like this.

You've Hit the Reset Button: Welcome to the Learning Phase

Here's the other critical piece of the puzzle: patience. When you make a significant change to a campaign—like changing the optimisation event, the creative, or the targeting—you throw the campaign back into what Meta calls the "learning phase".

During this period, the algorithm is essentially starting from scratch. It's testing your ad on lots of different types of people within your new target audience to figure out who responds best. Performance will be erratic. Costs might spike, results might dip, and metrics will look messy. This is totally normal. It's the cost of teaching the machine what you want it to do.

The cardinal sin of media buying is to panic and make changes during the learning phase. You've seen one day of data. That's not a trend; it's a blip. You need to let the campaign run, untouched, for at least 5-7 days or until it gathers about 50 of your desired conversion events (in this case, 50 purchases). Only then will the algorithm have enough data to stabilise and start delivering consistent results. And only then will you have a clear picture of what your true Cost Per Purchase is.

Making decisions based on 24 hours of data is like deciding to sell your house because it rained on a Tuesday. You need more data to see the real weather pattern. Here’s a simple flowchart for how you should be thinking about this.

It's not about cheap clicks, it's about affordable customers

So if we agree that CTR is a distraction, and that CPA and ROAS are what matter, the next logical question is: "What is a *good* CPA?". The answer isn't a fixed number; it's entirely dependent on what a customer is worth to your business over their lifetime.

This is where we get into Customer Lifetime Value (LTV). Calculating this properly is the single most powerful thing you can do to unlock aggressive, intelligent growth. It changes your entire mindset from "How low can my costs go?" to "How much can I confidently afford to spend to acquire a customer and still be wildly profitable?".

A simple way to estimate it is:

LTV = (Average Order Value * Purchase Frequency * Customer Lifespan) * Gross Margin %

A more robust way for subscription-type businesses or businesses with repeat purchases is:

LTV = (Average Revenue Per Customer Per Month * Gross Margin %) / Monthly Customer Churn Rate

Once you know your LTV, you can determine your maximum allowable Customer Acquisition Cost (CAC). A healthy ratio for a growing business is typically an LTV:CAC of 3:1. This means for every £1 you spend to acquire a customer, you get £3 back in gross margin over their lifetime. So if your LTV is £300, you can afford to spend up to £100 to acquire that customer. Suddenly that £40 CPA from your 'Purchase' campaign doesn't look so bad, does it? It looks like a bargain.

Use the calculator below to get a feel for your own numbers. This isn't just an exercise; this is the fundamental math that should drive your entire marketing budget.

So, what should you actually do right now?

Okay, that's a lot of theory. Let's make it practical. Based on everything we've discussed, here is the exact plan I would follow if I were in your shoes. I've broken down the key recommendations into a simple table for you.

Following this plan will give your campaign the best possible chance to succeed. You've made the right strategic move by switching to purchase optimisation; now you just need the discipline and the right framework to see it through.

This whole process of navigating algorithmic changes, understanding the deeper meaning behind the metrics, and building scalable campaign structures is, frankly, why experts exist. It's a full-time job to stay on top of this stuff, and the difference between a rookie mistake (like panicking over CTR) and an expert insight can be thousands of pounds in wasted ad spend.

Hopefully, this detailed breakdown has given you a much clearer picture of what's happening and a solid plan for what to do next. If you get through this next week and feel you'd rather have an experienced team manage this process for you, we offer a completely free, no-obligation strategy consultation. We can take a look at your account together and give you some more specific advice.

Regards,

Team @ Lukas Holschuh