23 Things I Learned by Spending $100,000 on Facebook Ads
By Jim Huffman on Friday, May 26th, 2017
We’re sharing the lessons we learned from spending over $100,000 on Facebook ads in 2017.
So, you want to scale your Facebook ads?
You want to go from spending, say $5 per day to something like $30,000 every month?
Great! But, hold onto your big bills. Let’s cover some basics.
This past year, we took on two tasks: mastering the always evolving Facebook ad platform, and scaling a budget for Facebook ads from $20 a day to $40,000 a month.
Here’s what we learned along the way.
1. Set Up Your Infrastructure for Facebook Ads ASAP
It doesn’t start with Facebook. It starts with your website.
For the sake of this example, we’ll assume you’re an ecommerce site on Shopify or WordPress and you’re selling products that are between $30-$300.
Do you know your conversion rate?
Specifically, your conversion rate from organic traffic and social traffic. Do you have those numbers handy? Go get them, I’ll wait.
If you have a conversion rate for social and organic search that is at 2 percent or above, then you’re in a good place. (Disclaimer: This conversion rate will be different depending on whether you’re selling diapers or diamond rings.)
However, if your conversion rate is well below 2 percent, then I highly recommend focusing on conversion rate optimization (CRO) to get your conversion up. If you’re spending money for traffic, make sure you get the most out of it. The importance of this can’t be understated. It would be like driving a bus load of people to a restaurant that had awful food and no service. It really wouldn’t end well. So make sure your site is ready for the traffic.
What if you aren’t selling products? Let’s say you’re goal is not a transaction. Maybe it’s an email sign up. If you’re existing sign up rate is over 4 percent, then you’re ready to start driving traffic to it. If not, think about using a lead magnet like a downloadable guide or checklist for capturing emails.
The Facebook Pixel is Your Friend
Set up the Facebook Pixel on your website. It’s a small snippet of code that you copy from the Facebook Business Manager and drop on your site. By setting up this Pixel, you can retarget any user that visited your website and then visits Facebook. This way you can re-engage a user that has shown interest in your website but didn’t convert.
To double-check that it’s working correctly, use the Facebook Pixel Helper Chrome Extension. If it lights up blue when it’s on your site, then you’re good to go.
Build Our Your Target Audiences
Knowing who you’re targeting is probably the most important aspect of your campaign for Facebook ads. It can make your beautiful campaign groundbreaking or a complete flop. Here are the four audiences I would test from the start. Yes, they’re in order of my personal preference.
- Your email list: Facebook allows you to upload your email list to Facebook and retarget them on Facebook. Gamechanger! This will be your highest converting segment if you have a product with lots of repeat purchases. Start here.
- Your website traffic: As mentioned above, the Facebook Pixel allows you to retarget people that visited your website. This is a great one for converting users that have already shown interest in your website.
- A Lookalike Audience of your email list or website traffic: This is where the power of Facebook comes into play. Just like you know a lot about your customers, Facebook knows a lot about its users: articles they like, brands they follow, content they upvote, ex-girlfriends they message, everything. They’re able to make a Lookalike Audience based off of your email list or your website traffic. They claim that this audience will be 90 percent similar to your audience and has a reach of 2,000,000. It’s been great for scaling the reach of our clients.
- Target fans of competitors: Facebook has an Audience Insights tool that allows you to slice and dice segments based on your competitors, influencers, and other personalized data. We recommend start by building a segment of over five competitors that reaches over 500,000 people.
2. What Are Your Marketing Campaigns?
Videos versus images
Always test at least three images or videos against each other. Some options for images include product shots, editorial shots, or social shots (the latter of which are basically photos not taken by a pro).
Based on our experience, the product images ended up being the best for sales, social images are great for click thru rate, and videos are great for engagement. If you do a video with audio, make sure you type out the subtitles. It has a decent impact on conversion. If you don’t have the capability to create your own unique video content, then use Facebook’s slideshow feature to make a video. These would outperform the video ads for us half the time.
That being said, always test three against each other because you’ll be surprised at what actual converts. If you use text on the images, then make sure the copy takes up less than 20 percent of the real estate on the images. If not, Facebook won’t approve it.
Test a lead magnet
The top performing ads from a click through rate (CTR) perspective usually give the user something in exchange for a click. For an ecommerce company, that could be giving people 20 percent off or give them something with purchase. For a B2B company, you could offer a guide or a checklist in exchange for a click or email. Just make sure those users aren’t one hit wonders.
Turn your press into ads
Social proof is a powerful thing. It allows you to use the words of a credible source to promote your brand. You can do this in the form of quotes from press, notable partners, or customer testimonials. If you hit a roadblock with ad copy, start by using quotes and blurbs from your press or from your customers.
Want more emails? Try a lead ad.
If you have a strong email onboarding series, then go aggressive with lead ads. A lead ad serves an ad on Facebook that captures the email with the Facebook ad. You can use a tool like Leadsbridge to pass that email into your email service provider. We were able to get emails for under $1 for a good stretch.
3. Determine the KPIs for Your Facebook Ads
Congrats, your ads are live. Now what? How do you know if your ads are performing well on Facebook? Track these four metrics:
- CTR: Get your click through rate (CTR) over 1 percent
- CPC: Get your cost per click under $1.00
- Frequency: You want a frequency score under 3
- Relevance: You want a relevance score over 6
What is your url structure?
When it comes to tracking the performance of your ad, it’s all about your link structure. Assuming you have Google Analytics setup, use Google’s URL builder on any link you use for an ad. This allows you to track your campaigns once the user goes from Facebook to your website. Then you can see which campaigns result in sales and which campaigns result in a high bounce rate.
What should you do when things don’t work?
As the great philosopher Mike Tyson once said, “Everyone has a plan until they get punched in the mouth.” Sadly, most of the startups that we work with start by doing Facebook ads on their own. They put ads live and then they don’t see any results.
This is when you want to roll up your sleeves and really understand what isn’t working and start using that information to drive your next test. Here are some quick optimization tips for getting your ads on the right track:
- Desktop only: This means no mobile. Your conversion rate is probably better when people aren’t on the go.
- Newsfeed only: Put the ad where their eyes are going. It’s more expensive but it’s a better overall return.
- No audience networks: Facebook really pushes this one, but these platforms are not as engaging as Facebook. No need to do this when you’re under $1,000 a day.
- Duration two to four weeks: Do not set the campaign as “Ongoing.” You want to give Facebook’s algorithm a set time period where you want results.
- Manual bid: This allows you to control how much you pay per click. It can guarantee you won’t go over a certain price. Just know that it will take longer to deploy your spend.
- Wi-Fi and new devices: Okay, you still want to do mobile ads. Make the setting for mobile devices that are “connected to Wi-Fi.”
- New iPhones: If you really want to do mobile then only serve ads to users that have an iPhone 6 or newer. If they’re buying the latest iPhone they might buy your product.
4. The Right Way to Increase Your Facebook Ad Spend
Well done! Your ads are crushing it. Now it’s time to put gasoline on the fire. You’re going from $50 a day to $1000. That’s easy—you just change the daily spend from $50 to $1,000, right? Wrong. Here are some tips on what to do.
Facebook’s auto-increase feature
If you want to go from spending $50 a day on an ad to $150 a day, then just tell Facebook. They have an auto-increase feature that allows them to scale your ad spend by percentage or price while still optimizing how the ads are served. This way you alert Facebook of your increase so they can prepare.
Create detailed segments for your top performing ads
Say you’re spending $20 a day on your top performing ad. Great—let’s break it up even further. Make that same ad for just desktop, just right column, mobile, and a tablet. Put $20 to each of those ad sets and you just quadrupled your ad spend on the same ad.
Leverage dynamic ads
For ecommerce websites, Facebook allows you to upload your entire product catalog to Facebook (via an Excel document or a plugin). This way you can do product-specific retargeting automatically. Let the computer manage the 1,000 SKUs for you.
Switch to the Power Editor
Managing three to five ads is fine with the Ads Manager. But, once you start doubling or tripling the test, that tool isn’t as fine. Upgrade to the Power Editor (it’s free) so you can do split tests and perform mass updates.
After spending $100,000 on Facebook ads, we were able to learn a lot about the Facebook Ads Manager, best practices for creating engaging ads, and how to scale a paid marketing campaign. Hopefully, you now have a better idea on how to make the most of your own Facebook ad campaigns to help execute your marketing plan.