graphic with marketing plan

The 9 Rules for Making Facebook Ads Work (or, How We Managed $5 Million in Ads to Generate more than $40 Million for our clients in 2016)

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In 2016, we managed a little less than $5 million in online ads for our clients and generated a little more than $40,28,000 in revenue for our clients. Clients ranged from small “mom and pop” businesses to large, multi-million dollar companies.

The industries we served ran the gamut from a translation firm to colleges to online businesses to non-profits with a bunch of different missions. In short, we made Facebook ads work for these clients.

How did we help these people create a more than 800% return on their advertising investment?

800percentROI
Here is a screenshot of performance for a typical PPC client account over a month, we wish we could show you all of them…but there isn’t enough room.

It was fairly simple, but definitely not easy. We followed nine (9) key steps to make sure that all of our clients had successful (and profitable) Facebook campaigns.

If you’re not up for a long read and can figure it all out yourself, here are the nine steps in a nutshell:

We try to work with clients who have great products and services. Then we work with them to help them market the products and services in a way that…

  1. Meets an obvious need (existing search traffic/interest).
  2. Appeals to user’s desire to live better, healthier, or have more fun.
  3. Benefits that are emotional easy to understand.

We also help clients create clearly defined audiences for their products and services. This means we…

  1. Clearly describe the best audience for each campaign.
  2. Make sure there are enough of them out there who can buy at the price we need.
  3. Establish that the audience clearly wants/needs what the client provides.

If you want your campaigns to succeed, you need to be committed to testing… over and over and over. We test constantly by…

  1. Crafting different campaigns for different phases of the buying cycle.
  2. Trying multiple formats and copy for creative (ads and landers)
  3. For each campaign, create an established “control” ad (the one to beat) and then change ONE thing for each test.

If you’re just here for the bullet points, then there you have it. While there are *plenty* of “tricks” out in the world of Facebook marketing, if you consistently engage in these nine steps whenever you launch and manage a new campaign, you will be successful.

If you want more detail in terms of *how* to execute these rules for making Facebook Ads work for you, then read on!

Great Products Matter

Rules 1 thru 3: Have Great Products & Services.

When we first engage with a client, we get as much information as possible on their product and service mix. And when we say “as much as possible”, we’re talking everything from finding out what clients provide to how products are made or services are delivered to how they engage with existing and past customers. Basically, we want to know as much as possible about our clients’ business in an effort to see how they fit into the market as a whole and what kind of story they can tell to prospective new customers. In all of our client relationships, we’ve found that a clear understanding of these first three rules is key.

Rule #1: Your product or service should meet an obvious need and preferably be targeted at an existing set of users or web traffic.

In short, everyone who advertises on Facebook (or anywhere for that matter) should be able to answer the question: “What do you do??”

For many businesses, it’s simple: “We put new roofs on people’s houses.” “We provide financing for people buying new homes.” And so forth… Other businesses are more subtle or complex.

Take the example of a business coach or life coach who is selling their services. In this case, we want to see either a strong niche (as in, “I help owners of body shops grow their businesses.”) or we want to see a very clear or distinct methodology (as in “I help people discover their true potential through my patented system.”)

Regardless, our goal in this early stage of putting campaigns together is to understand each revenue generating piece of a client’s business and then express the need that product or service fills as clearly as possible.

If you can’t explain clearly what obvious need your products or services fill, then you need to keep at it until you can!

In addition, it’s ideal if your product or service serves an audience that is already online and using Facebook. If you target octogenarians, then Facebook might not be your best bet. Likewise, if you provide financial advice to Amish congregations.

Rule #2: Ideally, your product or service appeals to the user’s desire to live better, healthier, or happier.

Every business serves its customers’ needs in subtly different ways. But the most effective campaigns on Facebook tell the story of a product or service by demonstrating that customers are healthier, happier, or live better as a result of buying.

Facebook ads work when you can show how your offering taps into one of these three key elements.

Realize that the more you can do to show specific improvements and express them (both as part of ad copy and landers as well as in guiding principles for a campaign’s strategy) the better people will emotionally identify with your story or brand. For health – does your product help people lose weight, have better skin, or reduce joint pain? Then you will be able to tell a very simple and powerful story in the short format of an ad and a lander.

Does your service provide convenient delivery of meals, allow you to adjust your thermostat from your phone, or give your home cleaner air? You’re helping people live better lives and your marketing message will resonate.

If your product helps parents build a better relationship with their kids or have more free time, or have more fun enjoying their favorite pastimes and lead happier lives, then you’ll also have a great story to tell.

In short, work hard to express your product’s appeal in terms of one of these three important ways and you’ll be on the road to success.

Rule #3: Express your product or service’s benefits in ways that are emotionally appealing and easy to understand.

People buy (especially online) based on their emotional reactions to the product or service and what it can do for them. You want to be sure that your appeal to your potential clients is based on these deep, emotionally satisfying triggers.

As weird as this sounds, it’s almost more important how a customer feels about what you do for them than what they actually get from what you do for them. Say you own a gym and, if people follow your program they will get leaner and be in the best shape of their lives. Believe it or not, people don’t really care about “being in the best shape of their lives”. Rather, they care about “feeling great!” or “having increased confidence” or “looking great naked”… these are all emotional elements that go beyond the dry facts of being at such-and-such weight and so-and-so body fat.

You need to be able to explain what you do and how you do it in a way that appeals to your potential customers’ emotions.

target the right audience

Rules 4 through 6: Target the Right Audience.

The next three rules deal with finding and getting in front of the ideal audience for your product or service, similarly to how WishBone talks about local business advertising. Since our clients have already gone through the process of understanding and describing their offerings by following the first three rules, we often find that obeying rules four thru six is pretty straightforward.

Rule #4: Clearly describe the best audience for each campaign you want to run.

Many businesses (especially those who promote themselves on Facebook) find it a bit challenging to break their marketing message into distinct campaigns because they are able to bring so much value to so many different types of buyer. But the key to successfully making Facebooks ads work is to have a very well defined audience in mind – and a very specific problem of theirs you want to solve.

This isn’t the place to get into a longer discussion of the phases of the buying cycle (or better yet, the buyer’s journey), but just remember that different people not only have different core needs, but they are also at different phases of the journey they will take to ultimately become your customer. This means that you want to consider your offerings from the standpoint of not only which specific problem they will solve for what sort of person, but also where that person is in the decision making process.

Ideally, you will break out each of the different problems you solve into a particular “macro” campaign and then create specific campaigns for each stage of the buyer’s journey towards a purchase.

Here’s an example: Let’s say you are a flooring business that specializes in contemporary, eco-friendly materials with speedy installation times. Your product and its delivery are aimed at making people’s lives better and healthier through increased enjoyment of their homes (making the floors beautiful), enhanced value (improving the home’s resale value through better materials), and healthier living (because the flooring materials contain no chemicals or treatments that harm kids or pets and are made from renewable resources).

In addition to those three benefits, your service team is also known for great estimating capabilities and rapid installation. And as a result, you can charge a premium for your services.

How would you break this into a series of campaigns? Begin by looking at the audience for each of the problems you solve.

Sample Problem: “How can I increase the value of my home and make it a nicer place to live at the same time?” Ask yourself what types of people have this question – and then describe them. Often you don’t have to look any further than your past sales to see that, for you, most of the people who fall in this category are first time home owners in their 30’s with no kids and a couple of pets. Half of them are single and live alone. The other half live with a spouse or partner.

Now consider how these people buy your product or service. You can break this bigger group into a set of smaller campaigns based on how ready they are to buy from you. The largest group of people are those who don’t yet have the idea that “flooring” is a great solution to this problem. They may be looking at basic articles on home values, or reading “top 10 things to brighten up your house” lists. They want information and broad ideas and some sense of comparison between different possible projects.

Next up would be people who have decided that flooring is the way to go and are trying to decide what type of product to purchase and what their best options are. These people want to understand the product, installation times and costs, and how the finished project will look in their home. They are ready to become connected to your brand as a possible source for a specific project.

Then you have the ready buyers – they know what they want and are ready to make a purchase based on whatever criteria they have decided are most important (this could be cost, it could be something more vague like “the story” of your brand, or it could be speedy installation and service, or even design services). These people are the closest to an actual purchase, but often the hardest to “sell” if you haven’t established a relationship with them before this stage.

The great part is that all of these interests and demographic characteristics can be targeted on Facebook. And if you want to make your ads and campaigns work for you in a way that’s cost effective and returns terrific sales, then you need to break each of these into different, distinct campaigns with different, well-described audiences.

Rule #5: Make sure your audience is large enough to offer a viable business opportunity.

This may seem obvious, but it’s surprising how many people neglect the basic research that goes in to answering the question, “Are there enough people in my target audience who are willing to pay my prices for my product/service?”

A great example comes from the early days of the internet when a company called “Webvan” was planning to offer rapid (as in same day/same hour) delivery of groceries and other items to households in major cities.

On its face, it would seem like a no-brainer. Large cities have lots of people. Those people live places. They eat. They don’t like to shop. Therefore, the audience for “people who would love to have things like food delivered” is clearly quite large.

Also, limiting the service to large cities made the expenses associated with storage and delivery much more palatable than, say, committing to deliver to every location within a 200 mile radius.

The problem was that in order to make the service really work, you needed to either have large groups of people who were very close together all buy at the same time or you needed individuals to buy a fairly large amount of food (or whatever) with every order.

Delivering individual packs of gum to nine different apartments across three of Manhattan’s Boroughs was not going to be profitable at the prices people were willing to pay.

This was a simple failure of audience research. Unlike a business like Amazon that can store goods in centralized warehouses and use delivery services like UPS and can take two days to get you your stuff, Webvan had enormous additional costs. Costs that their target audience was not willing to absorb on an item by item basis. At the same time, that audience was not willing to order in enough bulk to make delivery feasible.

In other words, there simply weren’t enough of the right kind of buyers to make the business profitable.

Lots of things can change to make a business profitable from a previously untenable pool of potential customers. You could develop a new technology or a new service/delivery method. There could be broad cultural changes that make your pricing more palatable. And so on.

But if the audience does not exist in sufficient numbers today to make your revenue goals attainable, then you should not be spending money on advertising.

Rule #6: Establish that your audience clearly wants and needs what you provide.

Again, this seems obvious. It also seems like it should have been covered by the previous two steps.

But many businesses make a terrific case for the problems they solve and the emotional benefits of those solutions. They also have terrific data that shows a large group of potential buyers. Unfortunately, they wind up falling short because none of the potential buyers really want that problem solved or don’t want it solved in the way you’ve described.

Think of the politician who identifies that people are very concerned about the national debt and the future solvency of the government. She has enormous amounts of data and research to show that the only way to safely guarantee the future of programs like Social Security and medicare is to introduce massive cuts to pretty much every other area of the federal budget and to make it a matter of law that Congress can no longer “borrow” from the Social Security trust fund.

Clearly, there are a lot of great and very real problems solved by her approach. These problems and a desire to solve them are also keenly felt by large portions of the population. In addition, the population has the wherewithal to “pay” for these solutions.

But finding takers for massive cuts to just about any federal program is a very, very tough sell. The target audience certainly wants a solution – but they don’t want that solution.

This same notion is what drives the success of much of the diet and fitness industry. Getting in shape or losing weight are not especially complicated. Work out hard six days every week and eat high quality foods in lower quantity than you do now.

Presto.

But people don’t really want that solution by and large. They feel the problem of being out of shape or overweight, but they do not want a solution that amounts to working hard pretty much every day and being hungry and sore in the bargain.

Fortunately, as our population grows, the raw numbers that account for the small percentage of people who do want to sign on for this boring, but effective approach make for a large enough pool of buyers to make it viable.

Consider the popularity of CrossFit. Even with 8000 gyms across the country with an average 110 members each, you’re only talking about a million people all told who are part of this “fitness craze”. That’s less than 1/3 of 1% of the US population.

The audience is relatively small, but large enough to make it viable.

Before you start spending your hard earned dollars on an effective online ad campaign, be sure that your audience of potential buyers with enough money to pay you and who want the type of solution you are selling is large enough.

campaign structure and testing

Rules 7 thru 9: Use the Correct Facebook Campaign and Testing Structure.

The final rules are all about the particulars of getting your message across. The first six rules are about strategy and broad vision. These last three are about tactics and execution with your campaigns on any PPC platform – especially Facebook.

Before we get started, realize that there are really only two core elements to any Facebook campaign; the people you’ve targeted with your products and services (which we covered above) and the ads you show them to get responses. That’s what we’ll talk about here.

Rule #7: Create different campaigns (and ads) to address the unique needs of your audience at difference phases of the buying cycle.

There are a huge variety of things you can do to optimize and tweak the targeting and outcomes of campaigns on Facebook. While we can’t get into all of them here OkDork does a terrific job of outlining the core ways to optimize an account. For our purposes, note that the questions and appropriate answers for your potential buyers change depending on where they are in the buying cycle.

Recall Rule #4 above and how our example buyer’s thoughts and needs changed as she went through the journey of purchasing a new floor to increase the value and livability of her home.

When it comes to the nitty gritty of creating specific campaigns for your business, you need to develop a distinct campaign for each phase of this buying cycle and make sure your Facebook Ad account is properly setup. An example makes it easy: In the flooring case above, if our buyer is just now trying to figure out what to do to her home to enhance it’s value and make it a nicer place to live, it would be far more appropriate to serve an ad that offered a comparative guide to different types of home improvement.

At this early stage in the buying cycle, showing her an ad for a 20% off coupon is far less likely to get her attention. She doesn’t know she wants a new floor yet!

When it comes time to create your campaigns, simply write down the different questions and solutions that you uncovered as you followed Rule #4. Now, next to each of them, make a note of what sort of offer or marketing message would be appropriate and appealing at that stage in the buying journey.

These messages will form the core ads in your new campaigns.

Rule #8: Create and test multiple ads for each campaign you’ve created.

Many people new to digital advertising put a single ad in place, watch its performance, and then “try another one” when they do not get the results they want. While this approach has the benefit of streamlining cost and management (a minimal spend on a single ad is half that of two ads and you are only keeping track of one thing at one time), you lose a couple of key benefits.

First, testing ads only in “series” (one after the other) results in sloppy data that can’t really be compared. Let’s say you’re a CrossFit gym pushing for new members and you try out an ad in January, then decide to change it in February. At the beginning of March, you compare the results for each.

Not so fast! The fitness industry is highly seasonal and January often represents the largest wave of traffic you will find all year. People are ready to buy any sort of “New Year/New You” offer in January.

Okay – so your ad should do great in January and February’s results should be weaker, right? Maybe not. The folks who jump on the fitness bandwagon in January are notoriously short-lived (like the old joke says, “I’m gonna open a gym called “Resolutions”. It’s a gym all through January, then a bar the other 11 months of the year…”).

Whether you like it or not, your February ad is going to be “aimed” at people who have already made it through that first month of the year and are likely more committed to a fitness lifestyle than your January audience. This makes them more likely to remain clients longer.

Which pool of traffic is better? That’s up to you and your business model. But comparing the results of different ads at those different times of year is fruitless. The nature of the audience has changed too much to make any comparison effective.

There are tons of businesses that are similarly seasonal.

If you want to know what ads work (or what elements work), you need to test them head to head at the same time of year and with the same pools of traffic.

We recommend a minimum of two ads per campaign or better yet, two ads per targeting group. And we also recommend constantly changing and refreshing these ads as your campaign evolves.

Which brings us to the final rule for making Facebook ads work for your business:

Rule #9: For each campaign, create an established “control” ad (the one to beat) and then change ONE thing for each test.

In old school direct marketing (back when it was all done through the mail), companies established what was known as the “control kit”. This was simply the mail package that was sent to prospective buyers to prompt a sale. The entirety of the “kit” was the control – the envelope and what was printed on it (and how it was printed); the letter inside (it’s copy, layout, font, and graphics); any response cards to be mailed back; any inserts that touted more product features.

After initial testing and product launch, a single package was chosen as the baseline that all other packages had to beat in order to be adopted. Then, for successive mailings, marketers would make disciplined choices to change a single element of the package for a small group of recipients in order to see if that change gave a higher response rate.

In fancy terms, this is called “split testing” or “creating an A/B split”.

Here’s all you need to know about this kind of testing. Your goal is to establish one ad that is your baseline “good” ad. This means that when you run it, you make money and don’t lose money. Simple as that. (Well, it’s a little more complicated in that your ad also drives people to some kind of end result – maybe your facebook page or a web page or an order form, so really it’s the combination of your ad and wherever that ad points people that is your control. The important part is that this combo is profitable! Never choose an unprofitable control!!)

With your control in hand, you are ready to “Split Test”. This simply means that you choose one thing – maybe the image or the headline or some of the offer copy or adding emojis to your ad text – and you create an ad that incorporates that one thing and send traffic to it.

Your goal is to send enough traffic to both ads at the same time to see which one “wins”.

How do you know which one wins? While there are tons of sophisticated techniques for squeezing the last dime of knowledge and profit out of a good test, keep it simple for yourself – the winning ad is the one that made you the most money.

If your test ad won, then it is now your new “control”. If not, then off to the trash heap it goes – and it’s time to test again.

You can split test every element of your advertising. Which is great – but also scary because there are so many elements in play in creating long-lasting success with your campaigns. But rest assured, the return on even the smallest amount of disciplined testing is well worth it.

There you have it. These are the nine rules we follow for every campaign we run whether it’s on Facebook, Adwords, Instagram, LinkedIn, or Twitter (or anywhere else for that matter!) Obviously, there are a lot of additional tweaks and techniques we make to campaigns to help them succeed, but following these core rules creates the foundation of EVERY profitable campaign we write and run.

And it’s the reason that our clients average an 800% return on their ad spending.

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