Have you heard of UGC? What exactly is User Generated Content? How should a UGC ad be structured? What do you absolutely need to keep in mind?
If you’d rather listen than read the most important facts about the best format for paid social ads, we’ve got something for you:
Our co-founder Jason gave a talk on this topic at the OMR Festival. If you couldn't be there live, you can watch the full talk here.
The Great Automation
The Facebook algorithm has been extremely optimized over the last few years. It requires less and less manual input, learns continuously, and independently searches for optimization opportunities.
A lot has changed here:
- Automatic Placement: Automated placements mean manual setup is no longer necessary.
- Dynamic Product Ads: Meta automatically selects the most relevant products for the user from your catalog.
- CBO (Campaign Budget Optimization): This automatically adjusts the budget at the campaign level.
- Broad Audiences: The need for granular audience settings is eliminated.
- Dynamic Creatives: Images, videos, text, and CTAs are assembled automatically.
Creatives Take Center Stage
With the automation of the algorithm, the heart of an ad has taken center stage: the creative. In the past, performance marketing revolved exclusively around hard sales KPIs like ROAS, CPA, and conversion rate. But a lot has changed in performance marketing over the last few years. While the focus used to be almost entirely on these hard KPIs, other figures have also taken center stage in 2022. This doesn't mean that classic KPIs have gone out of style; they have simply been supplemented by additional metrics that are used specifically for optimizing creatives. Let’s take a closer look at these in the next step.
Which KPIs are particularly relevant?
1. Scroll Stop Rate
Especially in today's world, where our attention spans are constantly shrinking, it is crucial to present your message clearly in the first few seconds. At Mawave, we have therefore introduced a new metric that makes it possible to measure whether an ad captures the user's attention: the Scroll Stop Rate. When an ad is shown to a user, there are two options: either they keep scrolling, or they stop and actually look at the ad. The Scroll Stop Rate indicates how often users keep scrolling versus how often they stop. Specifically: the ratio of impressions to 3-second video views. By the way, you can easily add the Scroll Stop Rate as a custom metric in Ads Manager. The goal, of course, is to stop as many people as possible from scrolling past.
2. CTR (Click-Through Rate)
The click-through rate indicates the number of clicks in relation to total impressions. If an ad is displayed 1,000 times and clicked 100 times, the CTR is 10%. You can use the CTR to measure the effectiveness and attention-grabbing power of your ad . If you have a low CTR, you should consider how you can optimize your ad and design it in a way that truly engages users and encourages them to click.
3. CPC (Cost per Click)
Cost per click refers to the amount you pay for a click on your ad. A lower amount is obviously an advantage here. When comparing the performance of different creatives, you should definitely keep an eye on the CPC.
The fact that these KPIs are particularly relevant in 2022 doesn't mean you should focus solely on these figures. Other KPIs, such as ROAS or conversion rate, remain relevant and provide you with valuable information about your users' purchasing behavior. You should still define goals for these KPIs and ensure they are met for your campaigns. However, it is definitely worth shifting your focus more toward creative-related KPIs higher up in the funnel.
Deep Dive Creative: Which formats work particularly well?
As a leading agency, we manage over €100 million in annual ad spend for our clients. This gives us access to an enormous amount of data that we analyze daily. As a performance marketing agency, we use this data as the foundation for our decisions. For example, we test different formats against each other over a specific period. Here is a quick look at some of our insights:
Image vs. Video
If we look at costs first, it is noticeable that impressions for video formats are more expensive than for images. Nevertheless, videos achieve better CPCs and CPOs. And these are not just slightly, but significantly cheaper: video CPCs are on average 30% lower and CPOs 46% lower than those of images. This is primarily due to the significantly better click-through rate of videos. The CTR for videos is 95% higher than for images. This means users are almost twice as likely to click on a video ad. Ultimately, we also observe a higher ROAS for the video format, which is 27% higher than that of images. As you can see, from a performance perspective, it definitely makes sense to focus on video.
Non-UGC vs. UGC
But not all videos are the same. There are different formats that we can examine and compare in more detail. The comparison between glossy productions and animations versus UGC is particularly interesting. Here, we can observe essentially the same trends as in the comparison between images and videos.
Impressions for UGC are more expensive than for non-UGC videos. Nevertheless, we see 30% lower CPCs and 28% lower CPOs for UGC. Again, these values are attributable to the 57% higher CTR. Furthermore, UGC is also impressive in terms of ROAS: it is 28% higher for UGC than for non-UGC videos. Finally, let's take a look at the unique thumbstopper rate. This shows us how many individual people stopped scrolling when they were shown the ad. In this respect, too, UGC is clearly ahead with a 34% higher rate. Based on this data, UGC videos are definitely our winning social creative format of the year.
UGC – what is it anyway?
Your content should inform and entertain the user and help them keep your brand in mind. In the best-case scenario, they are so convinced that they purchase directly via the ad. For this to succeed, it must, of course, not be boring. Using only one, repetitive format will not work. Furthermore, not everyone is addressed by the same format. As you can see, nothing beats variety. Ultimately, a diverse mix works best. Nevertheless, from a performance perspective, it can be said that some formats tend to deliver better results. And UGC is right at the forefront.
The abbreviation UGC stands for User Generated Content. This includes everything that users create regarding a brand: comments, reviews, feedback, and product recommendations. As already mentioned, the click-through rate for videos is on average significantly higher than for images. With UGC videos, where users recommend products to other users, you combine the popular video format with authenticity. UGC ads are much more relatable than content created by a brand itself. As a result, they usually appear more trustworthy. People simply love receiving recommendations from others. Whether they know the person personally or not usually plays a secondary role.
What should you pay special attention to?
When creating your UGC videos, you should pay particular attention to the right structure with a hook, argumentation, and CTA. Let's go through exactly what that entails, step by step.
The hook:
This is about grabbing the user's attention. The first three seconds of your video must catch the viewer! And make them want to see more. That is exactly what the hook at the beginning of the video is for. Use provocative questions or statements here, for example.
The argumentation:
The middle part of your video should revolve entirely around your product. This is where there is enough time for various explanations that convince the user—sometimes through logic, sometimes through emotion.
The call to action:
The video concludes with a CTA that prompts the user to take action. This could be something like "buy now," "try it out today," or "get your discount."
When creating UGC ads, you can also get great inspiration from other ads! In our UGC Blueprint you will also find a link to our showroom—just click through and take a look.
How to get high-quality content
Now you know what UGC is and how your videos should ideally be structured. Theoretically, you're in a good position—but how do you actually get the right high-quality video material for your ads?
There are two ways to do this: either you hire an agency, or you take matters into your own hands.
Working with an agency to create UGC offers you several advantages:
1. An existing network of creators
If you decide to work with an agency, you can leverage their existing network. As an agency, we have built up a large pool of over 500 influencers and creators. This means we have the right creators for a wide variety of industries ready to go.
2. Full-service
Creating UGC content is quite time-consuming and involves more than just shooting a video. An agency takes care of all the necessary steps—from contacting the right creators and creating briefings to reviewing and editing the videos. You can truly hand everything over from start to finish and sit back and relax while your UGC content drives increased conversions.
3. Expert knowledge
You can particularly benefit from working with agencies that specialize in social media marketing, as they are experts in their field. Your campaigns are constantly monitored and optimized based on the data collected.
If you prefer to handle UGC in-house, you should start by reaching out to your existing customers. These loyal customers will appreciate the attention from your brand. Simply ask them if they would be willing to record their opinion of your product for marketing purposes. In exchange, you can send them free products. Your hardcore fans, in particular, will be on board immediately. Of course, you have to be careful not to give away free products to everyone—you still want to make sales, after all. But 5–10 people who are interested are enough to get you well-equipped with plenty of UGC material. Often, these individuals will share the content themselves, which further increases your reach.
If you want to scale, you should start sourcing people who are a good fit for you and your brand. Unlike influencer marketing, however, this isn't about working with people who have a massive reach. The whole point of UGC is that the user can identify with the creator—as if a good friend were recommending something. What you should look for, however, is that the person comes across as authentic in the video, has a pleasant voice, and can speak naturally in front of the camera. To ensure the creator can authentically convey your message, it is also important that they are truly convinced by your brand and stand behind your values.
What is the best way to optimize UGC?
The best way to optimize individual UGC creatives is not to optimize individual creatives, but rather the overarching communication strategy. In concrete terms, this means: don't get hung up on details or try to optimize specific creatives aimlessly by trial and error.
The most effective approach is a clearly defined testing roadmap. In this roadmap, you document your next steps and ensure that your work remains targeted. Creative testing must, of course, be tailored to your specific needs and is a never-ending process. Nevertheless, the initial testing approaches almost always look the same:
1. Angle testing
An "angle" refers to a specific communication strategy. This strategy summarizes the overarching message and the goal you want to achieve with the user. Classic examples of angles include: lifestyle, product-based, cost/benefit, problem-solving, sustainability, USPs, mission, etc.
2. Hook testing
As described above, the first section of a UGC video is always the hook. These first few seconds determine whether the user keeps scrolling or consumes your content—and, in the best-case scenario, follows through with the call to action. For this reason, the hook has huge optimization potential, and it is advisable to include it in your testing early on.
Further tests can subsequently include the call to action, the argumentation, the execution and style, the creator, the format, and so on.
Your UGC Template
You’ve now learned quite a bit about the UGC format and know exactly what to look out for when creating and optimizing UGC videos.
To help you get started right away, we’ve created a UGC blueprint for you. You can download it directly here. We’ve summarized all the key information for you in a concise format. On top of that, we’ve included a link to our UGC showroom and free templates for you to use. You can easily import these into Premiere as Motion Graphic Templates. Once you place them over your UGC video, you just need to enter your custom text and adjust its position to fit your video. You should also definitely add subtitles to your video so your message gets across even if someone watches it without sound.
If you don’t have any experience with Premiere yet and want to ease into video editing, we recommend starting with apps like Canva. These are super intuitive to use, and you can also create subtitles and add elements like a call to action. To get that typical native Instagram look for your video title, simply use the Instagram app directly.
The best thing to do is get started right away and try your hand at your first UGC video!
If you want to read more about social media trends, such as how to take your online shop to the next level with online marketing, 25 online marketing acronyms you simply need to know, or what to do when you run out of content, then feel free to check out our blog!
Need more information on social media? Feel free to visit our website. You’ll find first-hand information across a wide range of categories.
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