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Meta tests profit-based ROAS optimization for advertisers

Meta introduces value optimization tools allowing advertisers to optimize campaigns based on profit margins rather than purchase size.

Luis Rijo

• 5 min read
Meta Ads Manager dashboard displaying profit margin optimization interface with ROAS metrics and value charts.
Meta Ads Manager dashboard displaying profit margin optimization interface with ROAS metrics and value charts.

Meta announced on June 4, 2025, the expansion of its value optimization capabilities through new products including Value Optimization, Incremental Attribution, and Value Rules. The company's announcement reveals tools designed to help advertisers optimize campaigns based on specific business outcomes rather than total conversion volume.

Fred Leach, VP Product Management at Meta, outlined the product expansion in an official announcement highlighting how advertisers can now provide information about valued outcomes and measurement approaches. "Some conversions are more valuable than others, and marketers want to focus on conversions that generate the specific business results they care about," Leach stated.

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Summary

Who: Meta Technologies announced the value optimization tools expansion, affecting all advertisers using sales and app promotion objectives on Facebook, Instagram, Messenger, and WhatsApp platforms globally.

What: Meta introduced an expanded suite of Value Optimization tools including enhanced Value Rules, Incremental Attribution global rollout, profit margin-based ROAS optimization testing, and Custom Attribution features for multitouch attribution integration.

When: The official announcement was made on June 4, 2025, with various features in different stages of rollout - Incremental Attribution available globally, Value Rules expanding availability, and profit margin optimization in testing phase.

Where: The tools are available through Meta Ads Manager globally for eligible campaigns, with Custom Attribution testing conducted through Analytics integrations with partners including Adobe Advertising, Northbeam, Rockerbox and Triple Whale.

Why: Meta developed these tools to address advertiser feedback about needing more sophisticated ways to optimize for business outcomes beyond conversion volume, enabling campaigns to focus on higher-value customers and outcomes that generate better return on ad spend.

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According to the announcement, advertisers using the "maximize value of conversions" performance goal achieved 12% higher return on ad spend compared to campaigns optimizing solely for conversion volume. The testing data demonstrates measurable performance improvements when campaigns prioritize value over quantity.

Value Optimization addresses multiple advertiser objectives through three primary approaches. For advertisers focused on return on ad spend based on purchases, Meta has updated its existing value optimization solution, which contributed to delivering an average 12% higher ROAS for advertisers compared to volume-only optimization. The example provided shows how a business with a $200 campaign budget would prefer $500 in revenue from 3 sales for a ROAS of 2.5 over $400 in revenue from 4 sales for a ROAS of 2.

Meta is testing profit margin-based ROAS optimization, recognizing that certain products generate higher profitability than others. The feature allows advertisers to send profit information through Meta's Conversions API to focus on driving ROAS based on profit margins rather than purchase size alone. A $20 product may benefit the bottom line more than a similar $30 product for some advertisers.

The platform is expanding globally the capability to optimize for ROAS based on non-purchase event values. Advertisers can now use the "maximize value of conversions" performance goal across any event, including custom events like first-time purchases or subscription signups. This enables calculation of ROAS based on value associated with custom events or non-purchase standard events.

Beauty brand Laura Geller implemented Value Optimization with a custom event targeting first-time purchasers. According to the announcement, the campaign instructed Meta's ads system to prioritize acquiring new customers who would generate high ROAS rather than focusing solely on new customer acquisition volume. The results showed a 46% increase in ROAS compared to their standard new purchaser campaigns.

Meta has also completed global rollout of Incremental Attribution, which the company describes as "the only product in the market that optimizes for and reports on incremental conversions in real time." Testing data shows advertisers using incremental attribution achieved an average 46% increase in incremental conversions compared to business-as-usual campaigns. The feature operates even for advertisers who have never conducted Conversion Lift tests, requiring only a simple toggle in Ads Manager.

The platform is introducing Custom Attribution features for advertisers using multitouch attribution tools. Through Analytics integrations with partners including Adobe Advertising, Northbeam, Rockerbox and Triple Whale, advertisers can share granular click-level attribution information with Meta. This enables testing of a new Custom Attribution feature over the next year, allowing incorporation of insights from external measurement sources into optimization algorithms.

Value Rules functionality is expanding to give advertisers additional steering capabilities for AI-powered ads systems. The product allows advertisers to set up rules in Ads Manager that assign higher value to specific customer types, directing campaigns toward higher ROAS outcomes. An advertiser knowing that a certain age group typically becomes repeat purchasers could create rules to bid more for these customers based on their higher lifetime value.

Ben Schreiber, CMO of Latico Leathers, described the Value Rules implementation: "Value rules have been a game changer for us. We zoned in on the 45-54 female demographic, increasing bids to this demographic by 75%. This allowed us to put more focus on an audience that we know typically has higher purchase value, while also maintaining broad targeting that would unlock additional sales and help us discover new potential audiences."

The Value Rules feature operates through prioritized rule sets where audience overlap triggers application of only the first applicable rule. If rule 1 specifies bidding 20% more for women in California and rule 2 specifies bidding 10% more for women using a particular mobile operating system, a woman in California using that operating system would receive only the 20% bid increase from Rule 1.

Value Rules are available for campaigns using sales and app promotion objectives with website or app as the conversion location. The feature is not available for Shop, Web+Shop, cross channel conversion optimization, Housing, Employment, Credit, SIEP, healthcare or pharma campaigns. Meta notes that using Value Rules may result in more conversions from preferred audiences but overall cost per result may increase.

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The announcement comes amid ongoing industry focus on value-based optimization rather than volume-focused metrics. Meta's advertising revenue reached $41.39 billion in Q1 2025, representing 16% growth compared to the same period last year, driven partly by AI-powered advertising tools adoption.

Digital marketers have expressed concerns about platform automation reducing manual control, particularly affecting small and medium-sized businesses. Meta's value optimization tools represent a response to advertiser feedback about needing more sophisticated targeting capabilities while maintaining automated optimization benefits.

The platform previously introduced optimization scoring tools to help advertisers identify improvement opportunities, with users experiencing a 12% median decrease in cost per result during testing phases. The Value Optimization announcement builds on these existing optimization frameworks.

Meta's approach differs from competitor offerings by focusing on real-time incremental measurement and dynamic value adjustments. The integration with external attribution tools addresses advertiser needs for cross-platform measurement while maintaining optimization effectiveness within Meta's ecosystem.

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