What Is a Facebook Pixel & How Does It Work?

Whether you’ve heard about it or not, the Facebook Pixel is something that all online advertisers need to fully understand. It’s the most innovative tool that Facebook has ever created because it allows marketers to take their ads to the next level.

Simply put, the Facebook Pixel is a short line of code that you install on your own website that sends user data back to Facebook’s servers. This small line of code is the engine that will drive all of your Facebook ads.

The Facebook Pixel allows you to do 3 main things.

1) Track the actions of all your website visitors

2) Create Custom Audiences & Retargeting Campaigns

3) Create Lookalike Audiences

These 3 actions are what make the Facebook ads platform so powerful.

First, we will take an in-depth look at each of the features the Pixel has to offer.

Second, we will show you how to create a Facebook Pixel and add it to your website.

Lastly, we will show you how to create custom audiences, retargeting campaigns, and lookalike audiences.

Be sure to keep reading until the end so you have a full understanding of the Facebook Pixel.

Audience Tracking & Data Collection

The main feature of the Facebook Pixel is that it tracks the “actions” of everyone that clicks your ad and then displays the results in the Ads Manager.

“Actions” are everything the viewer does on your website.

If your website is an online store, a few examples of “actions” include what products they view, which categories they view, which products they add to cart, and which products they actually buy.

Remember, these are just examples. The Facebook Pixel literally tracks everything the viewer does.

The Pixel then sends the data, which consists of the actions the user performed and who the user was, back to Facebook.

As the Facebook Pixel continues to collect data from incoming website viewers, your ads will start to automatically optimize.

Based on the data of users who purchase products from your website (or users that complete the conversion if your business isn’t an online store), Facebook will take this data and show your advertisements to people who are most likely to purchase products.

Furthermore, you can then view all the metrics based on the actions that users performed in the Ads Manager. Based on these metrics, you can determine which ads are successful and which ads you need to modify.

Here’s a timeline to help you visualize the process.

You create a Facebook Pixel
You install the Facebook Pixel onto your website
You run advertisements to your website
A customer clicks the advertisement and browses your website
The Facebook Pixel tracks each page they view and action they perform
The Facebook Pixel sends the data back to Facebook
Facebook accepts the data, determines who triggered the event, and log it in their systems, associating that user with the actions they performed
View the results of this data in the Ads Manager (e.g. Website Clicks, Page Views, Cost per Click, Cost per Purchase, etc.)
You can use this data to determine how the ad is performing

Furthermore, the other main features of the Facebook Pixel are creating Custom & Lookalike audiences with your data.

Custom Audiences

Custom audiences are audiences that you can create on the Facebook ad platform based on data from your Pixel.

In other words, these are audiences that consist of people who have already clicked your advertisement.

You can then create narrow audiences based on the action they performed.

For example, you can create a custom audience that includes everyone that’s viewed a certain page on your website in the past 180 days.

More importantly, custom audiences allow you to perform a very important task in advertising called retargeting.

Retargeting

Retargeting is when you advertise to people who have already interacted with your website.

By using Facebook’s custom audience tool, retargeting campaigns allow you to remind website visitors of your brand, offer additional discounts, promote new products, and build brand awareness.

Here’s an example of one our successful retargeting campaigns.

To help paint a clearer picture, let’s pretend you have an online store with a Facebook Pixel already installed.

You run ads for a few weeks with some success, but you realize that a lot of website visitors are adding products to their cart but not checking out.

This is the perfect time to create a retargeting campaign.

You create a custom audience of users who have added to cart in the last 30 days. Then, you create a new advertisement offering an additional 15% off their purchase.

Afterwards, you create a new ad campaign using the custom audience and new advertisement.

The campaign runs for a week and you see that the cost per purchase is extremely low.

Your retargeting campaign was extremely successful in helping you generate revenue for your store.

According to some studies and our own experiences, around 97% of online store visitors don’t buy anything on their first visit.

Although they may be interested in your products, they need a little reminder in the form of a retargeting campaign to actually complete their purchase.

Retargeting is an essential aspect of marketing and a tool that can take your brand to the next level. With the amount of competition in the digital space nowadays, it’s extremely useful to constantly remind people who have already shown interest in your brand.

Along with retargeting campaigns, custom audiences also allow you to make lookalike audiences.

Lookalike Audiences

Lookalike audiences are audiences that Facebook generates based on your custom audience. Facebook finds an entirely new list of people based on the data points in your custom audience such as interests, demographic, age, and so forth.

Using our online store example, let’s say you want to find users who are likely to purchase products from your website. Rather than using standard interest targeting, you can create a lookalike audience. Let’s break it down into steps.

Create a custom audience of people who have purchased from your website in the last 90 days
Create a lookalike audience using the custom audience
Facebook will create an entirely new audience based on the data of the users who have purchased from your store already
You can target this lookalike audience for your ads in the Facebook ads manager

Furthermore, when creating your lookalike audience you can specify how similar of an audience you want to have, ranging from 1% to 10%. 1% similarity is more specific and a smaller audience, whereas 10% is a bigger audience and less narrow.

This allows advertisers to test a variety of different lookalike audiences to see which one performs the best.

Why Use A Lookalike Audience?

Lookalike audiences allow advertisers to reach massive groups of users who are more likely to be interested in your brand.

Rather than spending money testing different interest groups, you can use the data from your Facebook Pixel and find people who are similar to your current customers.

The lookalike audience feature is one of the many reasons why Facebook is such an advanced advertising platform.

Instead of trying to find people who may be interested in your products, Facebook gives you an audience of users who are already likely to interact with your website.

This can ultimately lead to lower ad costs and more profit for your store.

As the advertiser, it’s important to test a variety of lookalike audiences along with standard interest targeting.

Why Do I Need to Set Up A Facebook Pixel?

At this point, you should understand the importance of the Facebook Pixel and all it has to offer.

The Facebook Pixel gives you access to an incredible set of tools that takes your marketing to the next level.

However, the Facebook Pixel is still just a piece of the Facebook Ads puzzle.

If you want to learn more about Facebook ads and how they work, check out our article titled “The Facebook Algorithm Explained: How To Master”.

In this article we go in-depth on Facebook’s innovative machine learning ability and advertising algorithm.

Let’s finally look at how to create a Facebook Pixel.

How to Create a Facebook Pixel and Add it to My Website

Before creating a Pixel, you need to have a Facebook Business Manager account. If you don’t have one go to: https://business.facebook.com/create

After creating your account you should see your Facebook Business Manager home screen. On the left-hand side of your screen, click “Business settings”.

You should have already created an ad account and added your Facebook page to the business manager.

If you haven’t, click “Ad accounts” on the left-hand side, then “Add”

And then “Create a new add account”.

After creating your ad account, click “Pages” on the left-hand side and add your Facebook page to the Business Manager Account.

With both of these added to your Facebook Business Manager, it’s time to create your Pixel.

On the left-hand side of your business settings, click “Data sources”, then “Pixels”, and then “Add”.

Enter in what you’d like to name the pixel and paste in your website’s URL if you’d like (not required). On the next screen, choose “Set up the pixel now”.

Now, click “Add code using a partner integration” and find the platform you are using for your website.

Facebook makes it easy to install the Pixel for Shopify, WordPress, Squarespace, WooCommerce, and many other platforms. If you see your platform, simply click it and follow their guide on how to install your Pixel on your website.

If your platform is not listed as a Facebook partner, you will have to manually install the code yourself. This involves copying and pasting some lines of code into the html of your website. Follow Facebook’s instructions on how to do this.

After fully installing your Facebook Pixel, you can send test traffic to your website to see if the Pixel is working. It may take a few minutes for the Facebook Pixel and your website to connect. Once your Pixel shows a green color and has received events, the Pixel installation process is complete.

Your Facebook Pixel needs to collect data before being able to create custom and lookalike audiences. For this reason, run ads as you normally would and let the Pixel start collecting data. Depending on your ad budget, we recommend you allow your Pixel to collect data for at least a few days before creating custom audiences.

How to Create a Custom Audience

On the home screen of your Facebook Business Manager account, click “Audiences” on the left-hand side. You will be using this tool to create all of your custom and lookalike audiences.

Now, click “Create a Custom Audience”.

Use “Website” as your source.

You have the option of creating a specific audience based on any action you choose. Furthermore, you can choose to include more than one specific action by clicking “Include more people”.

You can also choose to exclude people by clicking “Exclude People”. This is extremely useful if you only want to target users who added a cart to product, but didn’t purchase anything.

You include all people who added to cart and then exclude everyone who’s purchased something.

Example of a custom audience of users who have visited your website in the past 180 days.

You will also specify how many days you want the Pixel to track back, with a limit of 180 days.

Once you’ve filtered the custom audience to your liking, name your audience so it’s easy to identify and then click “Create Audience”.

Facebook will take a moment to fully populate the audience.

Once your custom audience is complete, you can finally make retargeting campaigns and lookalike audiences.

How to Create a Retargeting Campaign

A retargeting campaign is when you advertise to only people in your custom audiences. This means that these users have clicked your advertisements before, so it’s a good idea to create a new advertisement that caters more to your goals.

In the Facebook ads manager, you will create a new campaign and title it “Retargeting”. The campaign objective will depend on what your goals are. If you have an online store, “Conversions” is the best option.

Example of a retargeting campaign tracking back 7 days

After creating your campaign, it’s time to edit your new ad set. Under “Audience” in the ad sets menu, enter in the name of your audience under “Custom Audiences”.

After adjusting the settings in your retargeting ad set, the next step is to create the ad. Your retargeting ad will depend on your type of business and what your objectives are.

If you have an online store, you can promote new products or offer additional discounts. We recommend creating a few different ad creatives to test different offers.

Furthermore, you can create a dynamic retargeting ad to display products that each specific customer has viewed before.

For more information on retargeting campaigns, check out our article titled “Facebook Retargeting Ads 101: The Complete Guide”.

How to Create a Lookalike Audience

You can create a lookalike audience by going to the “Audiences” tool in your Facebook Business Manager. Next, click “Create a Lookalike Audience”.

Select your custom audience as the source and choose which countries you want users to come from. Lastly, choose how big you want the audience to be from 1%-10%. We recommend you to create multiple audiences sizes and test each one. Finally, click “Create Audience”.

You can use this audience the same way you used your custom audience for your retargeting campaign. Simply choose your new lookalike audience in the ad set level.

At this point, you should fully understand how to create a custom audience, set up a retargeting campaign, and how to create a lookalike audience. However, this was just an introduction on how to set up these features.

For a more in-depth look on how to set up winning ad campaigns using these tools, check out our YouTube Channel. We go over how to properly set up Facebook ads. Furthermore, we have case studies where we show you a successful store and how we set up the ads for it.

The Facebook Pixel FAQ

Are major companies using Facebook Pixels?

Every major online retailer or brand is 100% using Facebook Pixels. Digital ad spending finally surpassed TV ad spending in 2019 largely due to the dominance of the Facebook ads platform and the Facebook Pixel.

Think about all the times you browsed an online store and then suddenly started seeing the products you looked at while browsing Facebook or Instagram. This is only possible because of the Facebook Pixel.

Major brands have dedicated marketing teams that focus on retargeting consumers until they purchase an item. If this is a tool that the world’s best marketers are using, there’s no reason you shouldn’t because it’s completely free.

The ability to track your consumers and constantly remind them of your company can boost your brand awareness and revenue extremely high

. Marketing at the highest level is all about data, and the Facebook Pixel is the tool that companies use to gather a significant amount of their consumer data.

Next time you are browsing around H&M or your favorite online store, don’t be surprised when you start seeing H&M ads every time you scroll through Facebook.

Does the Facebook Pixel support cross-device tracking?

In other words, can the Facebook Pixel track users who use multiple devices? If you aren’t amazed yet by the Facebook Pixel, now’s the time to say “WOW”. Facebook is the only platform that will track conversions across multiple devices.

They will accurately show you which device actually completed the purchase or conversion.

Furthermore, when you’ve built your custom audience and run retargeting campaigns, you can retarget them on all devices that they use Facebook on.

For example, if they click through your ad on their PC and then you run a retargeting campaign, they will see your retargeting ad on their phone as well.

This is just another reason why the Facebook ads platform is so advantageous. You have the ability to constantly remind people of your brand.

What’s the added value for my campaigns?

The added value from the Facebook Pixel is priceless.

The amount of data and features offered to you as an advertiser are a gold mine.

It’s up to you to make the most of it and continue testing and learning. We have built multiple 6 and 7-figure businesses by using lookalike audiences and retargeting campaigns.

The ability to find people who are likely to purchase products based on a custom audience of people who have already purchased products is incredible. The lookalike tool and its ability to optimally find purchasers is outstanding.

By using a lookalike audience, your cost per purchase can potentially be lowered, earning you a higher net profit. We highly advise all advertisers to indulge themselves inside the Facebook Pixel and find a way to optimize their business with it.

The ability to create retargeting campaigns used to be incredibly difficult. Marketers would have to manually collect emails one by one, make a spreadsheet, and then launch massive email campaigns. Now you can do all of this extremely quickly with the Facebook Pixel.

What are the standard conversions that the Facebook Pixel tracks?

There are 17 main actions that the Facebook Pixel tracks. If the Facebook’s standard conversions don’t fit your needs, you have the ability to create custom conversions as well using your own parameters.

Purchase: Simply when someone completes a purchase on your website.
Lead: When someone signs up for something this will identify them as a lead on your site.
Complete registration: When someone completes a registration form on your site, such as a subscription form.
Add payment info: When someone enters their payment information in the purchase process on your website, but may not necessarily checkout.
Add to cart: When someone adds a product to their shopping cart on your site.
Add to wishlist: When someone adds a product to a wishlist on your site.
Initiate checkout: When someone starts the checkout process to buy something from your site.
Search: When someone uses the search function to look for something on your site.
View content: When someone lands on a specific page on your website.
Contact: When someone contacts your business.
Customize product: When someone selects a specific version of a product, such as choosing a certain color.
Donate: When someone makes a donation to your cause.
Find location: When someone searches for your business’s physical location.
Schedule: When someone books an appointment at your business.
Start trial: When someone signs up for a free trial of your product.
Submit application: When someone applies for your product, service, or program, such as a credit card.
Subscribe: When someone subscribes to a paid product or service.

Does the Facebook Pixel work automatically?

As soon as your Facebook Pixel is installed and it shows that events have been received, the Pixel will automatically work. Through Facebook’s impressive technology and software, the Facebook Pixel automatically attaches itself everywhere on your website. Viewers who click on your advertisement will immediately be tracked with all the data being fed back into your ads manager account.

What Is a Facebook Pixel & How Does It Work?

The Facebook Pixel

Audience Tracking & Data Collection