TLDR;
- Always optimise your campaigns for the final goal (Purchases), even if the data volume is low. Optimising for 'Leads' will just get you more people who are good at filling out forms, not necessarily people who will buy.
- The Facebook algorithm doesn't use 'Lead' events as a guide when optimising for 'Purchases'. You have to give it the exact signal you want it to find more of. Feeding it the wrong signal is a fast way to waste money.
- If you have almost zero purchase data to start with (less than 10-15 a week), you can temporarily optimise for a high-intent, lower-funnel event like 'Initiate Checkout' or 'Add Payment Info' to get the ball rolling. This is a temporary bridge, not a long-term strategy.
- Your long sales funnel requires a specific campaign structure. You need seperate campaigns for prospecting (ToFu), nurturing warm audiences (MoFu), and converting hot leads (BoFu) to guide people effectively from lead to customer.
- This letter includes an interactive calculator to help you figure out your customer LTV and what you can actually afford to pay per purchase, which is often much higher than people think.
Hi there,
Thanks for reaching out!
That's a really common and tricky situation you're in, and it's a question I see a lot. You've got a long funnel and you're stuck between giving the algorithm lots of cheap data ('Leads') or very little expensive, but more valuable, data ('Purchases'). It's a classic Facebook Ads puzzle.
Your thinking is logical, especially coming from Google Ads where you can stack conversion goals. But Meta works quite differently. The short answer is you should almost always optimise for the final action you want, in your case 'Purchases'. I'll walk you through why that is, what to do when you're starting with very little data, and how to structure things to actually support a longer buying journey. Let's get into it.
Why You Must Optimise for the Final Purchase...
This is the most important concept to grasp about the Meta ads algorithm: it is incredibly literal and single-minded. When you tell it to find people who will become 'Leads', it will do exactly that with ruthless efficiency. It will analyse the millions of data points of everyone who has converted as a 'Lead' from your ads and build a profile of a 'Typical Lead Submitter'. It then goes out and finds more people who look just like them.
The problem is, the profile of someone who is happy to give you their email address (a 'Lead') is often completly different from the profile of someone who is willing to pull out their credit card and buy something (a 'Purchase'). The lead submitter might just be a tyre-kicker, a freebie-seeker, or someone just mildly curious. The buyer has a real, urgent problem and the budget to solve it.
When you optimise for 'Leads', you are actively training the world's most powerful advertising machine to find you more tyre-kickers. You're paying it to find you an audience of non-customers.
To answer your specific question: no, the algorithm does not consider 'Lead' events as "food" or a positive signal when the campaign objective is 'Purchases'. It's a black-and-white system. If the goal is 'Purchases', only purchase events count as a success. Everything else, including leads, is essentially a failure in the algorithm's eyes for that specific campaign. It's a harsh reality, but understanding this is the first step to stopping wasted ad spend. You have to feed the machine the *right* signal, even if it's a weaker signal to begin with.
But What If I Have Almost No Purchase Data?...
Okay, so this is the practical hurdle. "Optimise for Purchases" is great advice if you have 50+ purchases a week. But what if you have one? Or zero? The algorithm needs a certain volume of data to exit the 'Learning Phase' and start optimising effectively. If it doesn't get enough conversions, performance can be erratic and expensive.
This is where we can be a bit clever. Instead of dropping all the way down the funnel to a low-intent event like 'Lead', we can choose a "proxy" or "micro-conversion" that happens just before the purchase. The key is that this action must signal a high intent to purchase.
Here’s a simple decision-making process:
The best options are usually 'Initiate Checkout' or 'Add Payment Info'. These are actions someone only takes when they are serious about buying. By optimising for one of these, you're telling the algorithm to find people who are *almost* buyers. It's a much cleaner signal than 'Lead'.
This is a temporary strategy. The goal is to use this micro-conversion to generate enough data and cash flow to feed the pixel with actual purchase data. As soon as you're consistently getting 15-20 purchases a week, you should switch your main campaigns to optimise for 'Purchases'.
How to Know What You Can Afford to Spend...
This whole conversation about optimisation leads to a more fundemental question: how much can you actually afford to spend to acquire a customer? Most people drastically underestimate this number, which causes them to panic and turn off campaigns too early during the difficult learning phase.
The key here is to stop thinking about Cost Per Lead (CPL) and start thinking about your Customer Lifetime Value (LTV). Knowing your LTV tells you the true value of a new customer, which in turn tells you how much you can profitably spend to get one (your Customer Acquisition Cost, or CAC).
Here’s the basic maths:
- Average Revenue Per Account (ARPA): How much you make per customer, per month/year.
- Gross Margin %: Your profit margin on that revenue.
- Monthly Churn Rate %: The percentage of customers you lose each month.
The formula is: LTV = (ARPA * Gross Margin %) / Monthly Churn Rate
Let's play with some numbers. Use the calculator below to get a feel for your own LTV. A healthy business can typically afford to spend about one-third of its LTV to acquire a customer (a 3:1 LTV:CAC ratio).
When you do this math, you often realise you can afford a £500, £1000, or even higher CAC. Suddenly, spending £200-£300 to get a purchase during the learning phase doesn't seem so scary. It seems like an investment. This mindset shift is absolutly vital to succeed with paid ads for a business with a long sales cycle.
You'll Need a Campaign Structure That Supports a Long Funnel...
A long buying journey means people won't see one ad and buy instantly. They need to be nurtured. They'll become a 'Lead', then maybe forget about you, see a retargeting ad a week later, visit your site again, and finally buy a month after their first interaction. Your campaign structure must reflect this journey.
The classic way to do this is with a ToFu/MoFu/BoFu structure:
- ToFu (Top of Funnel): This is your prospecting campaign. Its only job is to introduce your brand to new, cold audiences who have never heard of you. You'd use interest-based targeting or lookalike audiences here. The campaign objective should still be 'Purchases' (or your temporary micro-conversion).
- MoFu (Middle of Funnel): This is for warming up people who have shown some interest but aren't ready to buy. You'd retarget people who have visited your website, watched your videos, or engaged with your social media profiles. The ad creative here is different—it might be case studies, testimonials, or overcoming common objections.
- BoFu (Bottom of Funnel): This is for closing the deal. You aggressively retarget people who have taken high-intent actions like adding a product to their cart or initiating checkout but haven't purchased. These ads often include a strong call to action, maybe with an offer of free shipping or a small discount to get them over the line.
This structure ensures you have a constant flow of new prospects (ToFu), a system for building trust and familiarity (MoFu), and a mechanism to capture sales that would otherwise be lost (BoFu). Trying to do all of this in one campaign is a recipe for disaster with a long sales cycle.
My Main Recommendations For You...
To pull all this together, here’s the actionable plan I would suggest. This is a framework we've refined across numerous campaigns with complex funnels. I remember one B2B software client where we applied this exact logic, generating over 4,600 registrations on Meta Ads. It's a versatile approach that works just as well for high-ticket eCommerce products that also have a longer consideration phase before purchase.
| Recommendation | Why It Matters | First Step to Implement |
|---|---|---|
| Switch Primary Campaign Objective to 'Purchases' | This gives the algorithm the correct signal. It trains it to find actual buyers, not just lead-form fillers, which is the only way to acheive profitable long-term scaling. | Duplicate your best-performing 'Lead' campaign. In the new campaign's ad set settings, change the "Conversion event" to 'Purchase'. Start with a conservative budget. |
| If Needed, Use a Temporary 'Initiate Checkout' Campaign | If you get fewer than 15 purchases per week, this provides the algorithm with enough high-intent data to optimise effectively while you build up actual purchase volume. It's a vital bridge. | Set up a separate, small-budget campaign with the optimisation goal set to 'Initiate Checkout'. Target your broadest, best-performing audiences here. |
| Calculate Your LTV and Target CPA | Knowing what a customer is truly worth gives you the confidence to weather the initial 'learning phase' when costs are high. It shifts your focus from cheap leads to profitable growth. | Use the calculator in this letter. Gather your average monthly revenue, gross margin, and churn rate from your accounting/CRM software to get an accurate number. |
| Implement a ToFu/MoFu/BoFu Structure | A long sales cycle requires a structured approach. This ensures you are constantly filling the pipeline, nurturing leads, and closing sales effectively, rather than just showing one ad to everyone. | Create three seperate campaigns. ToFu: Cold audiences. MoFu: Website visitors/engagers (exclude purchasers). BoFu: Cart abandoners (exclude purchasers). Tailor messaging for each. |
As you can see, it's a bit more involved than just picking an objective. It requires a strategic approach to measurement, structure, and patience. Managing a long sales funnel on a platform built for impulse buys is definitly a challenge, and it's where having an expert eye on things can make a huge difference in avoiding costly mistakes and speeding up the path to profitability.
If you'd like to chat through your specific account and funnel in more detail, we offer a free, no-obligation strategy session where we can have a look together and give you some more tailored advice.
Hope this helps!
Regards,
Team @ Lukas Holschuh
