Do this BEFORE you launch a Facebook Ads Campaign
Ideally, your first two weeks should be spent optimizing your metrics.
To start with you will need to know your metrics. There are two different kinds of metrics you’ll need to pay attention to and track. Optimization metrics and Bottom Line metrics.
CPC – Cost Per Click
CTR – Click Thru Rate
CPL – Cost per lead
Conversion Rate on Landing Page
Conversion Rate on Sales Page
BOTTOM LINE METRICS
CPA – cost per acquisition (if lead gen, CPA is the same as CPL)
AOV – Average order value
We are using optimization metrics to measure performance against the bottom line metrics.
The formula is: to get CPA < AOV <<—Guaranteed profitability
So how do we get to there?
What we have to do is – before we ever launch a campaign – we have to establish the optimization numbers.
In order to do that, we will need to work backward. That way we can track and analyze the numbers to see if we are on the right path.
Let’s say you are selling a product for $300. Nothing else, just one product. So your AOV is $300.
Where do we need to be in order to get a 3:1 return ($3 revenue for every $1 spent)?
Our CPA has to be a third of the AOV… So, AOV = $300 then our CPA = $100.
Now, with some more basic math, let’s say we want to get 100 sales.
We will assume we can get 1% conversions on our sales page (This is why you need to know these metrics)…
In order to generate 100 sales, we will need 10,000 visitors to the sales page (100 / 1% = 10k).
If we want to get 100 sales, at no more than $100 a piece – we cannot spend more than $10,000 to generate these sales (100 * 100).
So how much will our CPC be? $10k / 10,000 visitors = we cannot spend more than $1 per visitor.
OR $1 CPC…
Knowing these numbers and setting them as our goal will now allow us to see holes in the optimization process.
If our CPC is higher than the $1, then we know we must work on our Ad (Targeting, copy, images, etc).
If we are getting clicks, but no conversions on our sales page, then we know that we need to optimize the sales page.
Not sure about your creative or targeting? A good benchmark is to look at CTR – if it’s above 1% – GENERALLY speaking, that means the ad targeting and creative are decent.
Shoot for 30 conversions for an audience size of 80,000 if you’re optimizing for conversions – if you don’t have these numbers, optimize for link clicks.
If you are looking to scale these campaigns, you must look at your CPA & AOV.
To go from 3:1 to 5:1 you MUST either raise your AOV or lower your CPA.
As long as you have everything optimized in your funnel (all your metrics aligned), scaling your advertising will simple and easy.
If not, you will have a ton of problems.
With your numbers dialed in, you can CONFIDENTLY say if I spend X, I will make Y.
Now, onto scaling…
Bump Budgets Every 3 Days
Never stop an ad that is working for you.
When you go to scale the ads that are showing results you’ll need to stay disciplined.
So many people see an ad that is working and increase the budget by 100-1000% right off the bat…
This is a No-No!
When you scale an ad what you need to do is increase the budget by 10-30% every 3 days or so.
Facebook optimizes the ads naturally through its algorithm, this process usually takes 3 days.
So never bump a budget by more than the allotted percentage otherwise, your working ad will turn to sh!t.
Test a New Targeting Angle
The initial ad set tested is the best guess estimate of our buyer interests.
Thus we need to look at testing other interests, behaviors, and demographics.
We live in a day and age where the digital strategies are ever-changing.
This should always be an ongoing process in your ad strategy.
All your ads have been running so you should have a decent amount of visitors who have gone to your sales page.
So next you’ll want to build a Lookalike audience based on the viewers who have landed on your page.
What this does is, Facebook will analyze the data of all the visitors to your page.
They will then find other people online that match that data description and show your ad to those specific people.
This helps to connect you with those who otherwise wouldn’t now you existed (much broader reach; minimum 300 people).
Your ad sets may have been targeting very specific niches and subsets.
If this is the case you’ll want to look into targeting a broader set of data.
So if previously you were targeting, say, women who are interested in Fabletics, ages 30-44, etc.
Instead just target people who are interested in the page Fabletics (usually a few million+).
Lookalike (Add To Cart & Purchases)
After really dialing down your different angles.
It’s best to start running the different lookalike audiences.
So create Add to Cart lookalike audiences.
Create custom audiences based on purchases and what items they purchased.
This will really help you connect with other similar types of people out there on Social.
Test New Ad Styles
Test out different color schemes.
Different styles such as video, carousel, slideshow, etc.
Create an ad with customer reviews or video testimonials – these are also really great for retargeting.
Find out what your audience really responds to and scale those ads.
Throughout this entire process, it is important to have retargeting setup and running.
The normal buyer will take somewhere from 5-20 touches to make a purchase.
Thus you’ll want to give them every opportunity to buy your product, while it’s fresh in their mind, that you can.
You should be in a constant state of testing. Test everything.
Even if you find ads that are working well for you, keep testing others as well.
Trends die fast in the digital space, so stay on top of your advertising by analyzing and testing all that you do.
Join the Club
Sign up and stay up-to-date with our latest content… There’s a lot of awesomeness to come in this crazy year of 2020!