Acquiring subscription customers with Meta Ads

Brands who sell to one-time customers alongside subscription customers have a big challenge in targeting paid ad spend.

They should be willing to spend a lot higher to acquire subscription customers, whose customer lifetime value (LTV) is significantly higher than one-off buyers. But in Google and Meta the customer acquisition cost (CAC) is blended between these two types of customers.

In addition, Meta has phased out a feature to focus ad spend on new customers - since it makes CAC look worse - so returning customer conversions are muddying the waters.

The solution is to add a New Subscription Customer conversion goal in Google Ads and Meta Ads, and use this custom conversion to focus on spend on subscribers - and also to split out the higher CAC for acquiring those subscribers.

Let me explain how to set up this conversion goal using Littledata, and use it in your first Meta campaign.

Step 1: Install Littledata

To track whether a customer subscribed (or not) Littledata needs to hook into the order tags coming into Shopify. This works automatically for brands using Recharge, and also tracks many Shopify subscription apps.

Littledata’s Shopify app offers a 30-day free trial to test out this new conversion goal.

Check out the full installation guide for Littledata to Meta Ads.

Step 2: Connect your Meta Ads account

Littledata then needs to push the server-side conversion into Meta, via the Meta Conversions API.

This takes a few minutes to setup using your existing access tokens for Meta Conversions API.

Step 3: Choose which conversions to track

By default Littledata will track all the customer events and conversions into Meta Ads, and replace your current tracking (e.g. from the Facebook & Instagram app).

If you want to test only the ‘First Recurring Purchase - Littledata’ conversion, then you can unselect the others - and add them later in the Littledata app settings.

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Step 4: Connect Recharge (optional)

Connecting your Recharge account to Littledata enables a more robust way of splitting new subscribers from one-time purchasers, along with tracking what happens to the subscriber after the checkout.

If you work with another subscription app, this won’t be necessary.

Step 5: Verifying the new conversion event in Meta Ads

The First Recurring Purchase event should be immediately flowing into your Meta Events Manager, but at this point it is marked as unverified:

You have to manually confirm each one of the new events:

Further details are given in Littledata’s help article.

Step 6: Create Custom Conversion based on First Recurring Purchase

From this point on you can use the new event in audiences, but you’ll need to set up a Custom Conversion to use First Recurring Purchase as a campaign goal.

Meta will also require you to choose the URL the conversion happens on. To make sure the conversion is tracked for any customer, add the condition where URL contains "/".

The last field is Value. You should leave this unchecked, as the conversion value is send from Shopify.

Step 7: Set up a campaign using the custom conversion

Once this custom conversion is set up you'll be able to build campaigns targeting new subscription customers. You can't switch the conversion goal for an existing campaign.

These campaigns will be more expensive in terms of Cost per Acquisition (CPA), but that’s more than offset by the higher LTV of those subscribers.

Conclusion

This custom conversion allows you to split your campaigns in Meta (and Google) Ads between acquiring:

1. One-time purchases - lower CAC but lower LTV
2. Loyal subscribers - higher CAC, higher LTV

Not only will this focus your campaign spend on acquiring subscribers, but Meta can also use the subscription signal to build lookalike audiences based on your loyal subscribers.

Later in 2025 I expect Meta to be able to use predicted LTV in their ad targeting, but for now the First Recurring Purchase event is the simplest and most effective way to improve ROAS for brands selling subscriptions alongside one-time purchases.

Let us know how this is working for you.