If you have money to spend then you are ready for Facebook Ads? If only this was true. Find out if you are ready & what you need to know before you invest.
What comes as a surprise to many people, is that I actually say no to more clients for Facebook Ads Management, than I say yes to. Why? Because they aren’t ready for Facebook Ads.
If you are like most people you believe that as long as you have money to spend then you are ready to invest in Facebook Ads. While this is true to a certain extent – it can often lead to overwhelm, disappointment and people abandoning the platform before they realise the potential of Facebook Ads.
So, what makes you ready for Facebook Ads?
I’m sure there are many schools of thought on this, however, I believe most people fall into one of two categories:
- Ready to scale with a proven funnel (or sales process)
- Prepared and willing to invest to test
Let me explain…
With a proven funnel or sales process that converts with organic traffic then you can amplify and scale your results with Facebook Ads.
But, what does this mean? Let’s say, you have a coaching series. You offer a free PDF download or audio series. For every 100 people who download your freebie, you book three to five discovery calls and gain one or two new clients.
This would mean that your conversion rate in your funnel or sales process is 1 – 2%. You gain one or two clients for every 100 people who enter your funnel.
However, if you invested in Facebook Ads, you could potentially get 1000 people to download your freebies which could result in more discovery calls and 10 – 20 new clients at the same conversion rate of 1-2%.
In the image below, you can see by using Facebook Ads and increasing the number of people in your funnel you can increase the number of discovery calls and of course new clients.
Generally speaking, conversion rates are lower when using Facebook Ads as your leads are colder – i.e. they don’t have the same relationship with you. Organic traffic from social media is when someone follows you online and has some level of relationship with you based on the content you share and their interaction with you.
With Facebook Ads, we test different creatives (copy and images) and different audiences. Some audiences have no idea who you are – cold traffic. Where some might have some relationships with you – warm traffic. We can use retargeting to your warm audiences to help increase your conversion rate.
If you haven’t run ads before it’s a process to test and measure the best combination of creative and audience to get you to your desired result.
What are your desired results? Obviously new clients but let’s break it down a little further.
Let’s say at 10 clients you are at full capacity. Based on a 1% conversion rate you need at least 1,000 people to see your download to book 20 discovery calls. If you convert 50% of your discovery calls then you will gain 10 new clients.
Next, you need to work out how much you are prepared to pay Facebook for each lead.
I’ve got this handy calculator that will do the heavy lifting for you. You can download your own copy below.
If your coaching is priced at $1200, with 1% conversion rate and you are prepared to spend $1500 on Facebook Ads you could gain anywhere from 2 to 30 new clients based on how much you are prepared to spend per lead.
Some of my clients are paying under $1 for leads, whilst others are paying up to $10 per lead. The cost per lead will depend on your market, your offer, your message and your ad creative. Paying $10 per lead isn’t bad, as long as your product or service and business can support it.
In the example above paying $1 per lead will result in 15 new clients at an average cost of $100 per client, which can be achievable for many business owners.
I have a client at the moment who is selling a monthly membership to teach young children a second language. Her current funnel is;
We are working on determining how many leads she needs to convert people to the $1 Trial and how many people become a full paying member after the 7 day trial ends.
She is prepared to invest to test – the second type of person who is ready for Facebook Ads. While we know the funnel converts with organic traffic – mainly influencer marketing – to really scale we want it to be profitable with Facebook Ads.
Currently, the numbers are all over the place, we are only a few months in and working on the best audiences and creative to make the funnel work and of course be scalable. The cost per new member is very up and down but we are collecting data, refining and tweaking. We are using the data to make better decisions every day.
For a membership site, we focus on the lifetime value of the client instead of the initial purchase. If they are a member for 6 months on average then the lifetime value is $174 which gives us more money to spend to acquire a new client.
If you are considering Facebook Ads, think about your numbers. The main ones to know are;
- Conversion Rate: Percentage of people who become a client after seeing your offer
- Number of Leads: How many people need to see your offer to achieve your client goals
- Cost Per Lead: How much will you pay to acquire a new lead
- Cost Per Sale/Client: How much will you pay to acquire a new client or sale
Remember, this handy calculator, which you can download below, will do the heavy lifting for you. When I speak to potential new clients, I run these numbers with them. It’s empowering to play around with the number to see how the results can vary.
Then at each part of the funnel, you can work to optimise. If you get leads for $2 instead of $3, how would that affect your numbers? How many more leads could you get, how many more clients?
If you have an e-commerce store you can also run Facebook Ads. However, I would first be aiming to get your store converting at 2% and then use Facebook Ads to re-target abandon carts and people viewing your shop who haven’t purchased.
If you are ready for Facebook Ads… keep reading
With over 12 years of Facebook Marketing experience I’m able to create, manage & scale your Facebook & Instagram Campaigns with confidence & great returns. I’ve been working with Facebook Ads since they first launched in Australia and what I know for sure – is that if you don’t know what you are doing – you might as well be throwing your money away.
Facebook Advertising is ever changing & without a strong understanding you can quickly throw good money after bad – with no results to show. If you are sick of wasting time, money & your sanity amidst the maze of copy, images, audiences, custom conversion, pixels & more then I can help.
Click here to view my Facebook Ads Management Services.