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Facebook Ads Testing - Part 1

Published on: December 7 2022 by Nick Peroni

Facebook Ads Testing - Part 1

The above is a brief introduction to Facebook Ads Testing - Part 1.

Let's move on to the first section of Facebook Ads Testing - Part 1!

Facebook Ads Testing - Part 1

startTime durationTime text
00:00:00 00:00:03 all right everyone welcome to the
00:00:02 00:00:05 Facebook Ads
00:00:03 00:00:07 testing module where we're gonna start
00:00:05 00:00:09 bringing it all together where
00:00:07 00:00:11 everything we toked about with the
00:00:09 00:00:15 audiences and with the creatives and
00:00:11 00:00:18 they'll form a testing strategy for your
00:00:15 00:00:20 ecommerce store with Facebook Ads first
00:00:18 00:00:22 thing that is important to note is that
00:00:20 00:00:23 there are two types of testing there's
00:00:22 00:00:25 testing when you already know what
00:00:23 00:00:26 you're selling there's testing when you
00:00:25 00:00:28 don't already know what you're selling
00:00:26 00:00:32 and they both require a different type
00:00:28 00:00:35 of thinking because there are different
00:00:32 00:00:37 types of testing right so if you already
00:00:35 00:00:38 know what you're selling for example
00:00:37 00:00:40 it's a private label where you're only
00:00:38 00:00:42 selling one product or you're in a
00:00:40 00:00:45 really specific niche where you only
00:00:42 00:00:46 have a few products or a small business
00:00:45 00:00:48 where you already have your own line of
00:00:46 00:00:50 products and and this is what you're
00:00:48 00:00:52 committed to right like this is your
00:00:50 00:00:56 product this is it then that type of
00:00:52 00:00:58 testing is a much more long form style
00:00:56 00:01:00 testing right because the product is the
00:00:58 00:01:02 product you're not changing the product
00:01:00 00:01:04 you're just trying to find the best
00:01:02 00:01:06 marketing angle is the best offers
00:01:04 00:01:08 you're trying to build loyalty around
00:01:06 00:01:10 the brand you're trying to build an
00:01:08 00:01:13 audience you're gonna be serving more
00:01:10 00:01:17 content and creating more content and
00:01:13 00:01:21 there there's so much more just focus on
00:01:17 00:01:24 the long term of that product but if you
00:01:21 00:01:25 are in drop shipping and print on demand
00:01:24 00:01:28 and you don't know yet what you're
00:01:25 00:01:31 selling you're just building a hybrid
00:01:28 00:01:34 store or a niche store to start testing
00:01:31 00:01:37 products and seeing what's gonna be your
00:01:34 00:01:39 your winners that you're gonna be able
00:01:37 00:01:42 to scale that's more of a rapid-fire
00:01:39 00:01:44 method testing where you're putting
00:01:42 00:01:47 products out there and you're testing
00:01:44 00:01:49 across a few different audiences with
00:01:47 00:01:52 small budgets to see what are showing
00:01:49 00:01:55 the early indicators of being a winning
00:01:52 00:01:57 product idea that you can scale so it's
00:01:55 00:01:59 a different style because it's much more
00:01:57 00:02:02 rapid you're making decisions on a
00:01:59 00:02:05 quicker basis to to actually try to find
00:02:02 00:02:07 the product that you want to sell as if
00:02:05 00:02:09 those are already having a product and
00:02:07 00:02:12 creating a much more longer form
00:02:09 00:02:15 marketing campaign a much longer
00:02:12 00:02:16 marketing funnel no matter what you're
00:02:15 00:02:19 testing there's always gonna be three
00:02:16 00:02:21 parts to a successful campaign and this
00:02:19 00:02:24 is the reason why building a brand
00:02:21 00:02:25 knowing what you're selling can be more
00:02:24 00:02:27 advantageous once you get to that point
00:02:25 00:02:29 of course there's nothing wrong with
00:02:27 00:02:31 starting out not knowing what you're
00:02:29 00:02:34 selling that you know that's the point
00:02:31 00:02:36 uh to try to get to a brand and have a
00:02:34 00:02:38 product or just a cup of products that
00:02:36 00:02:40 you're selling because there's actually
00:02:38 00:02:43 a few things that have to align right
00:02:40 00:02:46 the offer has to align with the audience
00:02:43 00:02:47 and the ad creative also has still
00:02:46 00:02:51 aligned with the audience and they'll
00:02:47 00:02:55 offer right so the reality is you could
00:02:51 00:03:00 be running you could be running a
00:02:55 00:03:02 product to the right audience with a bad
00:03:00 00:03:05 ad creative and it won't work you could
00:03:02 00:03:08 be running a product and not having a
00:03:05 00:03:11 good offer for that audience and it
00:03:08 00:03:14 won't work okay so this is why there is
00:03:11 00:03:16 actually somebody that asked me somebody
00:03:14 00:03:18 that asked me in the group not me
00:03:16 00:03:19 specifically I just saw somebody posted
00:03:18 00:03:22 in the group the other day this exact
00:03:19 00:03:26 question where they said is it possible
00:03:22 00:03:28 that because I used the wrong audience I
00:03:26 00:03:31 missed out on a winning product I was
00:03:28 00:03:33 testing this product a few weeks ago and
00:03:31 00:03:35 it didn't work for me but now I see
00:03:33 00:03:37 somebody else running this same product
00:03:35 00:03:39 with an ad and it has millions of views
00:03:37 00:03:40 and thousands of comments and shares and
00:03:39 00:03:43 it looks like they're selling it very
00:03:40 00:03:45 successfully and the answer is yes
00:03:43 00:03:47 absolutely it's possible that you could
00:03:45 00:03:50 miss out on a winning product because of
00:03:47 00:03:52 any of these things all right so that's
00:03:50 00:03:55 why when it comes to e-commerce it's
00:03:52 00:03:58 more about quality than quantity
00:03:55 00:04:01 right the everything first important
00:03:58 00:04:03 note is 90% of everything in e-commerce
00:04:01 00:04:06 is product to audience match you want to
00:04:03 00:04:09 find good products that your audience
00:04:06 00:04:11 either wants needs or loves right either
00:04:09 00:04:15 solve some type of problem or it really
00:04:11 00:04:17 you remember the pride passion problem
00:04:15 00:04:19 right the three P's pride passion
00:04:17 00:04:21 problem it did solve some type of a
00:04:19 00:04:22 problem or there's something they're
00:04:21 00:04:24 really passionate about or it's
00:04:22 00:04:25 something that
00:04:24 00:04:29 it deals with an area that they have a
00:04:25 00:04:31 lot of pride in then these are good
00:04:29 00:04:33 products that you can match to an
00:04:31 00:04:35 audience you can't force a market to
00:04:33 00:04:37 want something that it doesn't want
00:04:35 00:04:39 right so when you're looking at these
00:04:37 00:04:42 three parts to a successful campaign
00:04:39 00:04:44 that's why building a brand is more
00:04:42 00:04:46 advantageous that's why being selective
00:04:44 00:04:49 about your products is better because at
00:04:46 00:04:53 least then the time and effort that
00:04:49 00:04:55 you're putting in is is all going
00:04:53 00:04:57 towards something right like within a
00:04:55 00:04:59 brand it's not a waste you're you're
00:04:57 00:05:01 collecting data you're building
00:04:59 00:05:03 something long-term and and you're
00:05:01 00:05:04 constantly getting closer to the winning
00:05:03 00:05:06 combination
00:05:04 00:05:08 but if you're just randomly out there
00:05:06 00:05:11 throwing a bunch of stuff out and trying
00:05:08 00:05:13 to find something that stiks it's gonna
00:05:11 00:05:15 be a lot more difficult because with
00:05:13 00:05:17 these three parts to have to align it
00:05:15 00:05:20 decreases your chance of success
00:05:17 00:05:22 otherwise you're you're spending a lot
00:05:20 00:05:24 of time with each product that you're
00:05:22 00:05:26 trying to test because you're gonna want
00:05:24 00:05:29 to test multiple ad creatives and
00:05:26 00:05:31 multiple audiences and and I mean it's a
00:05:29 00:05:33 very baseline you should always have a
00:05:31 00:05:35 good offer okay you should get good at
00:05:33 00:05:39 creating a good offer which has to do
00:05:35 00:05:41 with your your product images your
00:05:39 00:05:44 product description your product price
00:05:41 00:05:46 and your your customer service your
00:05:44 00:05:49 overall customer experience right by
00:05:46 00:05:51 creating a good offer for sure but then
00:05:49 00:05:53 still you have to test multiple
00:05:51 00:05:54 audiences in multiple ad creatives right
00:05:53 00:05:57 so you want to be looking for quality
00:05:54 00:06:00 over quantity when it comes to your
00:05:57 00:06:02 testing a second important note if your
00:06:00 00:06:04 funnel is broken and all the traffic in
00:06:02 00:06:05 the world won't matter remember we
00:06:04 00:06:07 toked about this in the e-commerce
00:06:05 00:06:09 funnel section you didn't watch it you
00:06:07 00:06:12 should go watch it because this is
00:06:09 00:06:14 another area that a lot of people fail
00:06:12 00:06:17 because they don't understand the only
00:06:14 00:06:20 job of your ad is to get people to click
00:06:17 00:06:22 and visit the product page if people are
00:06:20 00:06:25 clicking here and visiting the product
00:06:22 00:06:28 page then your ad has done its job it's
00:06:25 00:06:30 been the products page job to get people
00:06:28 00:06:33 to move forward in the funnel same thing
00:06:30 00:06:35 here same thing here right so you don't
00:06:33 00:06:37 have a traffic problem okay nobody has a
00:06:35 00:06:39 traffic problem it's not hard to get
00:06:37 00:06:40 traffic right all you need to do is come
00:06:39 00:06:42 up with a good ad creative with a good
00:06:40 00:06:45 audience and you can get traffic and
00:06:42 00:06:46 your ad is doing its job and I see so
00:06:45 00:06:49 many people all the time like you know
00:06:46 00:06:50 why am I not getting sales I'm getting
00:06:49 00:06:52 clicks on my ad why am I not getting
00:06:50 00:06:56 sales well because your funnel is broken
00:06:52 00:06:58 somewhere okay so remember that if your
00:06:56 00:07:00 funnel was broken then all the traffic
00:06:58 00:07:03 in the world won't matter it's not the
00:07:00 00:07:05 ads fault this happens on social media
00:07:03 00:07:07 this happens on Facebook so all this is
00:07:05 00:07:10 doing here is getting people to click
00:07:07 00:07:12 and visit here and then these need to be
00:07:10 00:07:14 optimized for conversions all the way
00:07:12 00:07:18 through like we toked about in the
00:07:14 00:07:20 e-commerce funnel section they're an
00:07:18 00:07:23 important note where you target matters
00:07:20 00:07:26 for a general drop shipment and using a
00:07:23 00:07:28 service like we owe to dropship you're
00:07:26 00:07:31 going to be able to reach all the North
00:07:28 00:07:33 American and European countries and even
00:07:31 00:07:35 some Asian countries and about the same
00:07:33 00:07:37 timeframe right from 7 to 10 days
00:07:35 00:07:39 sometimes even quicker depending on
00:07:37 00:07:41 where it is so you might as well target
00:07:39 00:07:43 all of those countries if you're just
00:07:41 00:07:45 selling like general dropship physical
00:07:43 00:07:47 product items that you find on
00:07:45 00:07:50 Aliexpress that's like say kitchen items
00:07:47 00:07:52 home goods that you know the language
00:07:50 00:07:53 doesn't matter that the culture
00:07:52 00:08:01 generally doesn't matter like if you're
00:07:53 00:08:01 selling for example if you're selling a
00:08:01 00:08:08 home trying to think of a knight appear
00:08:03 00:08:09 if you're if you're selling a salad bowl
00:08:08 00:08:11 item that's the first one that came to
00:08:09 00:08:13 my mind because we just thought that as
00:08:11 00:08:15 an example recently right if so that
00:08:13 00:08:18 salad bowl item that's something that
00:08:15 00:08:19 could be sold in basically any country
00:08:18 00:08:21 right the audience is huge the
00:08:19 00:08:24 anti-theft backpack that's something
00:08:21 00:08:26 that was sold in every country all
00:08:24 00:08:29 around the world because it doesn't
00:08:26 00:08:31 matter what language you speak it
00:08:29 00:08:34 doesn't really matter what your culture
00:08:31 00:08:37 is like backpacks are a universally
00:08:34 00:08:41 relevant item all over so you might as
00:08:37 00:08:44 well offer that Idol and and target all
00:08:41 00:08:46 of these countries in your campaigns
00:08:44 00:08:49 because your supplier if you're using a
00:08:46 00:08:50 supplier like we owe to get it to all
00:08:49 00:08:53 these countries
00:08:50 00:08:54 see it doesn't matter so you might as
00:08:53 00:08:56 well right
00:08:54 00:08:57 but with print-on-demand it's a little
00:08:56 00:08:59 bit different because your print on
00:08:57 00:09:02 demand items that you're selling based
00:08:59 00:09:04 on being personalized may only apply to
00:09:02 00:09:05 certain people in certain countries or
00:09:04 00:09:08 certain languages or certain cultures
00:09:05 00:09:11 right as an example with the couple's
00:09:08 00:09:14 store that I had and I used as an
00:09:11 00:09:16 example as the case studies store that
00:09:14 00:09:20 that turned out into turned in the
00:09:16 00:09:23 dropship Academy to a lot of those items
00:09:20 00:09:24 were very American specific right
00:09:23 00:09:27 because they had to deal with the way
00:09:24 00:09:29 that American culture celebrates
00:09:27 00:09:31 weddings and celebrates bachelor and
00:09:29 00:09:32 bachelorette parties it's gonna be
00:09:31 00:09:34 different in different parts of the
00:09:32 00:09:36 world so I didn't target other parts of
00:09:34 00:09:39 the world some countries it might be
00:09:36 00:09:42 similar like in the UK or Ireland but
00:09:39 00:09:44 and I say those two countries because I
00:09:42 00:09:47 know I saw products there but for the
00:09:44 00:09:51 most part right right it's gonna be very
00:09:47 00:09:53 very specific to only a few certain
00:09:51 00:09:55 countries I wouldn't target Germany or
00:09:53 00:09:58 France or Italy because the way that
00:09:55 00:10:00 they have you know what they might call
00:09:58 00:10:02 their bachelorette party could first of
00:10:00 00:10:04 all be completely different it could be
00:10:02 00:10:06 in a different language and it's also
00:10:04 00:10:10 the way they celebrate it might be
00:10:06 00:10:12 completely different right so based on
00:10:10 00:10:14 the personalization of your product it
00:10:12 00:10:16 might only make sense for you to target
00:10:14 00:10:18 certain areas and then with your own
00:10:16 00:10:21 product the general rule is you start
00:10:18 00:10:23 vocal then go national men go global now
00:10:21 00:10:25 if you're in the US or you're selling
00:10:23 00:10:28 within your country generally you can
00:10:25 00:10:29 probably jump straight to national as
00:10:28 00:10:31 long as you have the ability to fulfill
00:10:29 00:10:34 the item because the shipping for
00:10:31 00:10:36 example within the US is is simple right
00:10:34 00:10:38 you can shift any part of the country
00:10:36 00:10:40 from any part of the country very easily
00:10:38 00:10:42 and affordably
00:10:40 00:10:45 so you might as well just jump straight
00:10:42 00:10:47 to national but you always want to make
00:10:45 00:10:49 sure you can handle the demand at that
00:10:47 00:10:51 level and that there is demand at a
00:10:49 00:10:54 higher level and you can fulfill at a
00:10:51 00:10:57 higher level before trying to move to
00:10:54 00:11:00 the next one and then the final note is
00:10:57 00:11:02 based on the complexity based on the
00:11:00 00:11:03 price and complexity of your product
00:11:02 00:11:05 this this is
00:11:03 00:11:07 going to matter in your facebook funnel
00:11:05 00:11:10 alright now we toked about in the
00:11:07 00:11:12 audience's video already the different
00:11:10 00:11:15 levels of intent within an audience okay
00:11:12 00:11:17 it's the same thing and in that video we
00:11:15 00:11:18 call it awareness engagement conversions
00:11:17 00:11:20 okay
00:11:18 00:11:23 same thing here just different words
00:11:20 00:11:25 awareness consideration decision all
00:11:23 00:11:28 right at the awareness level cold
00:11:25 00:11:31 traffic this is where you're trying to
00:11:28 00:11:33 get that initial engagement now if it's
00:11:31 00:11:36 a really simple product like a t-shirt
00:11:33 00:11:39 then this may be the only step that you
00:11:36 00:11:41 need okay people don't generally need
00:11:39 00:11:45 time to consider a purchase of a t-shirt
00:11:41 00:11:46 in in any country right that's you know
00:11:45 00:11:49 if they want the shirt they're gonna buy
00:11:46 00:11:51 the shirt based on seeing seeing what
00:11:49 00:11:54 they like okay and the only real
00:11:51 00:11:56 retargeting for that is to retarget with
00:11:54 00:12:00 a discount code because chances are
00:11:56 00:12:01 again that the only possible day if they
00:12:00 00:12:04 see the shirt and they don't want to buy
00:12:01 00:12:07 it then really it's probably just a
00:12:04 00:12:09 matter of price pushing them over the
00:12:07 00:12:11 edge so if you give them a discount or
00:12:09 00:12:13 or free shipping that maybe that pushes
00:12:11 00:12:15 them over the edge to make the purchase
00:12:13 00:12:16 decision but if it's a really complex
00:12:15 00:12:19 product like say you're selling an
00:12:16 00:12:21 electric fireplace well well now you
00:12:19 00:12:23 know $1,500 what's your fireplace now
00:12:21 00:12:26 you have to take it to a different level
00:12:23 00:12:28 because this is a much more complex
00:12:26 00:12:32 purchase decision because it's more
00:12:28 00:12:34 expensive right so awareness starts at
00:12:32 00:12:36 the cold traffic engagement level then
00:12:34 00:12:39 consideration so as an example here what
00:12:36 00:12:42 sees electric fireplace as at the
00:12:39 00:12:45 awareness level of like the like ake
00:12:42 00:12:47 introducing this new electric fireplace
00:12:45 00:12:50 that has an all new feature where you
00:12:47 00:12:52 can control your thermostat from
00:12:50 00:12:54 anywhere in the house oh and by the way
00:12:52 00:12:57 you can also change the color of the
00:12:54 00:13:00 flames to any color you want for the
00:12:57 00:13:02 room ambience and it's a cool video that
00:13:00 00:13:04 shows the fireplace in action shows
00:13:02 00:13:06 people you know the different flames and
00:13:04 00:13:09 shows people using a Wi-Fi have to
00:13:06 00:13:10 change the thermostat temperature right
00:13:09 00:13:12 so that could be the awareness level
00:13:10 00:13:15 it's a video it's getting people engaged
00:13:12 00:13:16 cold traffic introducing them to the
00:13:15 00:13:20 product and to the
00:13:16 00:13:22 as well at the consideration level now
00:13:20 00:13:25 you could follow up and retarget these
00:13:22 00:13:27 people say everybody that watched 50% of
00:13:25 00:13:31 this video now you're retargeting them
00:13:27 00:13:33 with a photo ad that shows a photo of
00:13:31 00:13:35 the fireplace and toks about some of
00:13:33 00:13:39 the benefits you know easy to install
00:13:35 00:13:42 and comes with a 10 year warranty and
00:13:39 00:13:44 will make your home so much cozier right
00:13:42 00:13:46 so you're you're leveraging content at
00:13:44 00:13:48 this level this is more traffic because
00:13:46 00:13:50 they've already been exposed to your
00:13:48 00:13:52 product and to your brand and especially
00:13:50 00:13:54 if you're targeting you know people that
00:13:52 00:13:56 have watched 50 percent of your video or
00:13:54 00:13:59 people who have visited the webpage
00:13:56 00:14:01 these are people that showed a level of
00:13:59 00:14:03 interest right so now the warm traffic
00:14:01 00:14:06 and you're just going to be leveraging
00:14:03 00:14:09 content to keep them engaged and in that
00:14:06 00:14:12 purchase decision okay you could be
00:14:09 00:14:15 sharing testimonials as well of a
00:14:12 00:14:17 homeowner that toks about how this
00:14:15 00:14:19 fireplace made their home so much better
00:14:17 00:14:22 something you know and it was so easy to
00:14:19 00:14:24 install or something like that okay and
00:14:22 00:14:26 then to the session level which is
00:14:24 00:14:28 conversions we're going for that
00:14:26 00:14:30 purchase right this is like the final
00:14:28 00:14:32 levels of the campaign now again it's
00:14:30 00:14:35 important to remember that at any one of
00:14:32 00:14:36 these boxes right it could be enough to
00:14:35 00:14:38 trigger a purchase okay if you're doing
00:14:36 00:14:40 a good job on your product page and in
00:14:38 00:14:41 your marketing you could trigger a
00:14:40 00:14:43 purchase here from some people
00:14:41 00:14:45 trigger a purchase here from from a lot
00:14:43 00:14:48 of people as well but then at this
00:14:45 00:14:50 decision level the idea is this is this
00:14:48 00:14:52 is where we're pulling at home right
00:14:50 00:14:55 this is where we're really pushing the
00:14:52 00:15:01 retargeting to our purchase decision of
00:14:55 00:15:03 telling people you know here's $200 $200
00:15:01 00:15:06 coupon if you decide to order work we're
00:15:03 00:15:10 having a flash sale next 48 hours $200
00:15:06 00:15:12 coupon use FB 200 and get this electric
00:15:10 00:15:15 fireplace for $200 off okay that's
00:15:12 00:15:18 that's like your hottest traffic you're
00:15:15 00:15:21 you're trying to push them with a final
00:15:18 00:15:23 decision to make that purchase again
00:15:21 00:15:26 you'll be optimizing for purchase
00:15:23 00:15:28 probably at every step of the way but
00:15:26 00:15:30 this is it's just different levels of
00:15:28 00:15:32 intent within the audience and then
00:15:30 00:15:34 finally here loyalty this is another
00:15:32 00:15:37 step after they've already made a
00:15:34 00:15:41 purchase of actually trying to get them
00:15:37 00:15:44 to to go through with another purchase
00:15:41 00:15:47 or buy something else upsell cross-sell
00:15:44 00:15:49 creating loyalty sharing new content
00:15:47 00:15:54 creating ongoing engagement with them
00:15:49 00:15:57 trying to add to the customer value okay
00:15:54 00:15:59 now an announcement as well before we
00:15:57 00:16:02 get started is the campaign budget
00:15:59 00:16:05 optimization Facebook recently made this
00:16:02 00:16:07 official they announced it that campaign
00:16:05 00:16:09 budget optimization will become
00:16:07 00:16:13 permanent to the way everybody wants ads
00:16:09 00:16:15 in September 2019 this will change the
00:16:13 00:16:18 testing strategy as you'll see the
00:16:15 00:16:20 testing strategy right now is based on
00:16:18 00:16:22 setting your budget at the outset level
00:16:20 00:16:25 and testing that way campaign budget
00:16:22 00:16:28 optimization moves your budget to the
00:16:25 00:16:30 campaign level and it's going to change
00:16:28 00:16:32 things all right but if you're watching
00:16:30 00:16:33 this now it's because this is still
00:16:32 00:16:35 relevant
00:16:33 00:16:38 alright this fact doesn't become
00:16:35 00:16:42 permanent until September 2019 and this
00:16:38 00:16:45 content will be updated as soon as it
00:16:42 00:16:47 becomes necessary because it will to
00:16:45 00:16:50 change the custom strategy but up until
00:16:47 00:16:53 that point it's it's not so if you're
00:16:50 00:16:55 unfamiliar with the the campaign budget
00:16:53 00:16:59 optimization it happens here
00:16:55 00:17:01 okay so right now this is an optional
00:16:59 00:17:03 thing when no matter what campaign
00:17:01 00:17:06 you're creating campaign budget
00:17:03 00:17:08 optimization is an optional tab and this
00:17:06 00:17:11 doesn't even used to exist until like
00:17:08 00:17:14 maybe mid 2018 it started to show up and
00:17:11 00:17:17 nobody really used it it was it was not
00:17:14 00:17:18 very good at first and it's it's been
00:17:17 00:17:21 getting better
00:17:18 00:17:22 I still don't use it but it's it's been
00:17:21 00:17:25 getting better and now it's worth
00:17:22 00:17:26 starting to look at and test and I've
00:17:25 00:17:28 been working with some people that are
00:17:26 00:17:30 using this as a strategy which I'll
00:17:28 00:17:32 share kind of what their strategy is
00:17:30 00:17:35 later in here so it's worth it to look
00:17:32 00:17:38 at and test because it is going to
00:17:35 00:17:40 become official but as of right now you
00:17:38 00:17:43 don't need to use it so the difference
00:17:40 00:17:45 is here in the budget and schedule right
00:17:43 00:17:51 now you set your budget at the ad set
00:17:45 00:17:54 level here okay but if you select
00:17:51 00:17:57 campaign budget optimization now you
00:17:54 00:18:00 have to set your budget at the campaign
00:17:57 00:18:06 level and then when you come to the ad
00:18:00 00:18:07 set you no longer have a section to set
00:18:06 00:18:12 the budget okay because that's already
00:18:07 00:18:14 been set at the campaigning level so
00:18:12 00:18:16 what exactly is the the function of
00:18:14 00:18:19 campaign budget optimization that looks
00:18:16 00:18:22 like this this is the current way
00:18:19 00:18:24 without campaign budget optimization you
00:18:22 00:18:26 can create multiple ad sets and you can
00:18:24 00:18:28 set the budget at each ad set level that
00:18:26 00:18:30 way you can allocate the budget the way
00:18:28 00:18:33 that you want to allocate it you have
00:18:30 00:18:35 the control to increase the budget on ad
00:18:33 00:18:38 sets that you like and decrease the
00:18:35 00:18:40 budget on assets you don't like with
00:18:38 00:18:43 campaign budget optimization you can see
00:18:40 00:18:45 this budget is moved to here so instead
00:18:43 00:18:48 of creating an ad set or a budget for
00:18:45 00:18:50 each ad set now you have to do it here
00:18:48 00:18:52 and Facebook is automatikally going to
00:18:50 00:18:57 distribute the budget the way that it
00:18:52 00:18:59 feels best is best for your campaign of
00:18:57 00:19:02 course this is an example basically
00:18:59 00:19:05 taken from Facebook so they're there
00:19:02 00:19:07 making it seem like you know the whole
00:19:05 00:19:12 idea and concept here from Facebook is
00:19:07 00:19:15 that they are going to help optimize
00:19:12 00:19:18 optimize better for you but really I
00:19:15 00:19:23 think I think most of us kind of feel
00:19:18 00:19:24 this is about as Facebook is it seems
00:19:23 00:19:28 like Facebook is trying to phase out the
00:19:24 00:19:31 duplicating ad set tactik to scaling
00:19:28 00:19:33 which we'll tok about here because it
00:19:31 00:19:36 does still work as a tactik right now
00:19:33 00:19:38 but it seems like Facebook is trying to
00:19:36 00:19:41 phase that out it's a tactik for
00:19:38 00:19:44 e-commerce sellers and so it's moving
00:19:41 00:19:45 the budget to the campaign level which
00:19:44 00:19:47 means it'll become about duplicating
00:19:45 00:19:49 your campaign instead of your ad set but
00:19:47 00:19:50 anyway this is the idea that it's
00:19:49 00:19:52 supposed to work better than the
00:19:50 00:19:54 Facebook will identify the best
00:19:52 00:19:56 performing ad sets and allocate more of
00:19:54 00:19:57 your budget there
00:19:56 00:20:00 and if you want to spend more money than
00:19:57 00:20:01 you increase the campaign budget and
00:20:00 00:20:05 then we'll allocate more and more here
00:20:01 00:20:06 but you know that's not necessarily
00:20:05 00:20:10 always been the case in the way that it
00:20:06 00:20:13 actually works right because Facebook's
00:20:10 00:20:16 metrics and understanding of where to
00:20:13 00:20:18 put the money is all based on an
00:20:16 00:20:20 algorithm and it's not the same as a
00:20:18 00:20:23 person actually coming in and looking at
00:20:20 00:20:25 each ad set every day you know in which
00:20:23 00:20:27 case sometimes you might say well I
00:20:25 00:20:28 didn't want to put more money here I
00:20:27 00:20:29 wanted to put more money here because
00:20:28 00:20:31 I'm getting a better
00:20:29 00:20:33 I'm getting a better return on adspend
00:20:31 00:20:35 here and then I am here right and so
00:20:33 00:20:37 that's the problem but we'll see how
00:20:35 00:20:39 this evolves and when it comes time to
00:20:37 00:20:42 update this training we will update it
00:20:39 00:20:44 now moving into some Universal testing
00:20:42 00:20:46 metrics okay these are the numbers
00:20:44 00:20:48 remember and in the beginning I said you
00:20:46 00:20:51 need to remove all motion and you want
00:20:48 00:20:54 to test based on metrics and looking at
00:20:51 00:20:58 the numbers and using that is a data
00:20:54 00:21:00 point okay your CPC is your cost per
00:20:58 00:21:03 click okay when you run an ad and
00:21:00 00:21:05 somebody clicks on the link in the ad or
00:21:03 00:21:09 they click on the button in the ad then
00:21:05 00:21:12 that is a cost per click alright if I
00:21:09 00:21:14 run if I spend 10 dollars on my ad and I
00:21:12 00:21:16 get 10 clicks then I have a $1 cost per
00:21:14 00:21:20 click right it's a metric that shows you
00:21:16 00:21:24 the overall cost compared to the amount
00:21:20 00:21:28 you've spent okay this is a good metric
00:21:24 00:21:30 to look at the effectiveness of your ads
00:21:28 00:21:32 all right because click show buying
00:21:30 00:21:34 intent so if I'm running an ad and
00:21:32 00:21:36 people are clicking it then I know that
00:21:34 00:21:38 people are interested in buying if I'm
00:21:36 00:21:41 running an ad nobody's clicking then I
00:21:38 00:21:44 know that this ad is a miss because
00:21:41 00:21:46 nobody is interested in actually getting
00:21:44 00:21:49 more information about whatever it is
00:21:46 00:21:51 unraidable causing so it's important to
00:21:49 00:21:54 remember that your cost per click is
00:21:51 00:21:57 rolled into your profit margin right so
00:21:54 00:22:01 here's why I say this alright
00:21:57 00:22:03 the ideal CPC cost per click for a 20 to
00:22:01 00:22:05 $80 product is going to be a dollar or
00:22:03 00:22:08 less because your profit margin in that
00:22:05 00:22:09 range if your cost per click gets to be
00:22:08 00:22:11 too high
00:22:09 00:22:15 then you're not going to be profitable
00:22:11 00:22:17 right if you have a profit margin if
00:22:15 00:22:19 you're selling say like that electric
00:22:17 00:22:21 fireplace okay and you are selling an
00:22:19 00:22:24 electric fireplace that has a profit
00:22:21 00:22:26 margin of $500 you can afford a lot
00:22:24 00:22:29 higher of a cost per clip right because
00:22:26 00:22:31 your margin is so much bigger so it's it
00:22:29 00:22:34 is important to remember that your cost
00:22:31 00:22:37 per click is relative but this is a good
00:22:34 00:22:40 indication number here one dollar or
00:22:37 00:22:42 less is where you want to see your CPC
00:22:40 00:22:46 or you know give or take around that so
00:22:42 00:22:50 like if we come in here dollar twenty
00:22:46 00:22:55 nine and this is just a very basic this
00:22:50 00:22:58 is an old ad so dollar twenty-nine cost
00:22:55 00:23:00 per click okay that's that's not
00:22:58 00:23:03 fantastik but it's also close enough for
00:23:00 00:23:05 me that I would keep running it right so
00:23:03 00:23:08 that's this is where your cost per click
00:23:05 00:23:10 is right here and this is the number I'm
00:23:08 00:23:12 toking about so you wanna you want to
00:23:10 00:23:14 keep that in mind as it's an early
00:23:12 00:23:16 indication right because ultimately
00:23:14 00:23:19 what's going to matter is your cost per
00:23:16 00:23:21 purchase but cost per click is an early
00:23:19 00:23:23 indication before you're getting
00:23:21 00:23:26 purchases to determine whether or not an
00:23:23 00:23:27 ad is working and you should keep it
00:23:26 00:23:33 running to see if you're gonna start
00:23:27 00:23:37 getting purchases okay your
00:23:33 00:23:42 click-through rate okay that's that's
00:23:37 00:23:50 that's a typo cuz that's meant to be
00:23:42 00:23:53 cause okay so that's how that should be
00:23:50 00:23:54 so alright click-through rate so your
00:23:53 00:23:56 click-through rate is per is a
00:23:54 00:23:58 percentage number alright percentage of
00:23:56 00:24:00 people clicking on your ad out of the
00:23:58 00:24:03 total amount of people who saw it this
00:24:00 00:24:05 is another way it's just it's a general
00:24:03 00:24:07 metric that you can use to measure the
00:24:05 00:24:10 effectiveness of your ads when you're
00:24:07 00:24:14 testing all right it lets you know if
00:24:10 00:24:16 you have a 1% or more you know if you
00:24:14 00:24:18 have a quick the rate of 1% or more it's
00:24:16 00:24:21 just a good indication that there's
00:24:18 00:24:22 buying intent here people are interested
00:24:21 00:24:25 in this product because they're quick
00:24:22 00:24:28 through at a rate of 1% are hired to
00:24:25 00:24:30 actually see the product page all right
00:24:28 00:24:32 now a note out here for videos and
00:24:30 00:24:37 worldwide targeting your click-through
00:24:32 00:24:42 rate might be lower because your your
00:24:37 00:24:45 CPM is gonna be lower right and for
00:24:42 00:24:46 people who are new let me think of the
00:24:45 00:24:48 best way to explain that when you're
00:24:46 00:24:50 running videos the engagement is so
00:24:48 00:24:53 cheap and when you're running worldwide
00:24:50 00:24:55 targeting the engagement is cheap but
00:24:53 00:24:58 the overall buying intent of the
00:24:55 00:25:00 audience is gonna be lower as well so
00:24:58 00:25:02 you're gonna be reaching more people
00:25:00 00:25:05 which is gonna dilute your click-through
00:25:02 00:25:07 rate okay that's that's the best way I
00:25:05 00:25:10 can think to explain it so it's just a
00:25:07 00:25:12 note to have because 1% is the metric
00:25:10 00:25:15 that I like to see on conversion ads to
00:25:12 00:25:18 highly targeted countries but if you're
00:25:15 00:25:21 running like a video or just complete
00:25:18 00:25:22 worldwide targeting then your
00:25:21 00:25:25 click-through rate is naturally going to
00:25:22 00:25:28 be diluted because of all the cheap the
00:25:25 00:25:30 cheap impressions you're getting
00:25:28 00:25:32 speaking of impressions cost per
00:25:30 00:25:35 impressions is another important metric
00:25:32 00:25:37 alright so going back to here ok
00:25:35 00:25:40 click-through rate here is 0.55 percent
00:25:37 00:25:43 that's that's not fantastik honestly
00:25:40 00:25:45 but again just looking at this as an
00:25:43 00:25:47 example that's what we have there now
00:25:45 00:25:50 your cost per prescience is here all
00:25:47 00:25:51 right this is your number based on 1,000
00:25:50 00:25:54 impressions how much is Facebook
00:25:51 00:25:58 charging you this is important because
00:25:54 00:26:02 your cost per impressions two reasons
00:25:58 00:26:05 number one your cost per impressions is
00:26:02 00:26:07 how facebook charges you when running
00:26:05 00:26:10 ads alright for every 1000 impressions
00:26:07 00:26:12 on that specific ad I just showed you
00:26:10 00:26:15 for every 1000 impressions I'm getting
00:26:12 00:26:18 charged seven dollars and fourteen cents
00:26:15 00:26:21 right my cost per click is derived from
00:26:18 00:26:25 my cost per impressions right because
00:26:21 00:26:26 based on how expensive this is it's
00:26:25 00:26:28 gonna affect how expensive this is
00:26:26 00:26:31 because how many clicks I'm getting
00:26:28 00:26:34 within the total amount of people that
00:26:31 00:26:36 saw that actually saw my ad is all
00:26:34 00:26:41 directly related to my cost
00:26:36 00:26:45 impressions okay your cost per
00:26:41 00:26:48 impressions also though is going to be
00:26:45 00:26:50 directly related to engagement and
00:26:48 00:26:52 relevance of your ad to the audience so
00:26:50 00:26:54 the higher your engagement the higher
00:26:52 00:26:56 the relevance the lower the cost of
00:26:54 00:26:59 impressions is going to be because
00:26:56 00:27:01 that's that's just the way the auction
00:26:59 00:27:03 system works alright the higher the
00:27:01 00:27:05 relevance and engagement the lower the
00:27:03 00:27:07 cost per impressions will be which is
00:27:05 00:27:09 why generally when you're running videos
00:27:07 00:27:11 your cost per impressions is a lot lower
00:27:09 00:27:13 because your engagement is so much
00:27:11 00:27:16 higher every time somebody watches a
00:27:13 00:27:17 video that counts as engagement if they
00:27:16 00:27:19 watch a video for more than three
00:27:17 00:27:21 seconds that counts as engagement so
00:27:19 00:27:23 with your engagement being so high your
00:27:21 00:27:25 cost for impressions is generally a lot
00:27:23 00:27:27 lower which allows you to reach a lot
00:27:25 00:27:28 more people with videos but it also
00:27:27 00:27:31 means that your click-through rate is
00:27:28 00:27:35 going to be lower because that
00:27:31 00:27:37 engagement is so much cheaper but it
00:27:35 00:27:39 doesn't directly correlate to people
00:27:37 00:27:42 wanting to actually click through your
00:27:39 00:27:44 product right now it's important in
00:27:42 00:27:48 those that you don't optimize for CPM
00:27:44 00:27:51 okay now why does this matter because
00:27:48 00:27:54 we're optimizing for purchase right in
00:27:51 00:27:57 in this example here we're optimizing
00:27:54 00:28:01 for purchase this is this is a purchased
00:27:57 00:28:04 conversion ad so I'm getting charged by
00:28:01 00:28:07 impressions but I'm optimizing for
00:28:04 00:28:09 purchased you could have a very high
00:28:07 00:28:11 cost per impression but still have a
00:28:09 00:28:13 profitable cost per purchase that's why
00:28:11 00:28:16 it's important to understand now
00:28:13 00:28:18 sometimes your CPM to just be ridiculous
00:28:16 00:28:21 it can make it hard the test right for
00:28:18 00:28:23 example if you have a CPM of $50 that
00:28:21 00:28:26 means to reach a thousand people you're
00:28:23 00:28:30 spending $50 now you might still be
00:28:26 00:28:32 profitable running that ad but you have
00:28:30 00:28:34 to spend a lot more to scale that
00:28:32 00:28:36 product right because it costs more to
00:28:34 00:28:38 reach more people so even though you're
00:28:36 00:28:41 you're spending at a profitable ratio
00:28:38 00:28:46 you're still spending more to reach more
00:28:41 00:28:48 people okay excuse me so that's my cost
00:28:46 00:28:49 per impression matters but you have to
00:28:48 00:28:53 remember
00:28:49 00:28:59 in context to your to your actual
00:28:53 00:29:02 conversion number a few more notes on
00:28:59 00:29:03 cost per impression the lower your CPM
00:29:02 00:29:05 this is what I just said the lower your
00:29:03 00:29:06 CPM the better your marketing efforts
00:29:05 00:29:08 and the more cheaper it is to reach more
00:29:06 00:29:11 people keep in mind competitive
00:29:08 00:29:14 audiences are going to have higher cost
00:29:11 00:29:16 per impression because they convert
00:29:14 00:29:19 better so more your cost per impression
00:29:16 00:29:22 is also going to fluctuate based on the
00:29:19 00:29:23 competition if there's a lot of people
00:29:22 00:29:25 competing for the same audience it's
00:29:23 00:29:29 going to naturally raise the cost
00:29:25 00:29:32 because it's an auction-based system so
00:29:29 00:29:34 if you're competing with a really
00:29:32 00:29:36 competitive audience or like if you're
00:29:34 00:29:39 competing doing really competitive
00:29:36 00:29:42 marketing times like holidays and
00:29:39 00:29:43 seasonal times and your cost per
00:29:42 00:29:49 impression is naturally going to be
00:29:43 00:29:52 higher ideal CPM for products is less
00:29:49 00:29:56 than $20 okay this says ideal CPM for
00:29:52 00:29:57 $20 to $80 products right so products
00:29:56 00:30:03 that are in the 20 to 80 dollar range
00:29:57 00:30:05 your CPM being under $20 is an ideal
00:30:03 00:30:08 cost per impressions okay and videos
00:30:05 00:30:13 help you get lower CPM because they have
00:30:08 00:30:16 higher engagement now cost per result is
00:30:13 00:30:19 the next one so there are many based on
00:30:16 00:30:22 what you choose to optimize for right
00:30:19 00:30:24 there's there's multiple things you can
00:30:22 00:30:26 choose to optimize for right on on a
00:30:24 00:30:28 conversion ad these are all the choices
00:30:26 00:30:31 you have you can optimize for view
00:30:28 00:30:33 content for Add to Cart for at I mean I
00:30:31 00:30:35 don't ever use search or add to wishlist
00:30:33 00:30:37 right but they are conversion events but
00:30:35 00:30:40 anyway the main ones are view content
00:30:37 00:30:43 add to cart initiate check out and
00:30:40 00:30:45 purchased you can also lead you know
00:30:43 00:30:47 there's there's a lot of own but for the
00:30:45 00:30:49 most part within e-commerce that's the
00:30:47 00:30:50 ones you're gonna care about purchase
00:30:49 00:30:57 Add to Cart
00:30:50 00:30:58 if you content okay so most people are
00:30:57 00:31:01 going to just optimize for purchase
00:30:58 00:31:02 right that's that's the main cost per
00:31:01 00:31:04 result we care about but
00:31:02 00:31:08 it's important to understand that when
00:31:04 00:31:08 you're looking at here cost per result
00:31:09 00:31:14 this is going to be whatever the cost
00:31:12 00:31:16 per result it shows you is going to be
00:31:14 00:31:18 whatever you're optimizing for in that
00:31:16 00:31:20 campaign so the reason I have them all
00:31:18 00:31:22 listed is because you might optimize for
00:31:20 00:31:24 something different but cost per
00:31:22 00:31:31 purchase is the main one that I'm going
00:31:24 00:31:33 to tok about and there is no Universal
00:31:31 00:31:35 number or guideline that you should look
00:31:33 00:31:36 for with these because it's all based on
00:31:35 00:31:38 your funnel and the profit margin of
00:31:36 00:31:40 your product right your cost per
00:31:38 00:31:43 purchase is the main one we're going to
00:31:40 00:31:45 tok about because this is your customer
00:31:43 00:31:47 acquisition cost this is your magic
00:31:45 00:31:50 number in marketing this determines how
00:31:47 00:31:54 profitable your campaign is okay this is
00:31:50 00:31:56 the one variable in everything that you
00:31:54 00:31:59 do right because your gross profit in
00:31:56 00:32:02 marketing and advertising equals
00:31:59 00:32:05 whatever your gross sale with shipping
00:32:02 00:32:07 is okay so say I'm selling a product for
00:32:05 00:32:10 seventeen ninety five plus four ninety
00:32:07 00:32:15 five shipping okay that's this number
00:32:10 00:32:19 here comes out to what 2294 and then I
00:32:15 00:32:22 subtract my cost of goods sold and my
00:32:19 00:32:25 cost per purchase okay I know what my
00:32:22 00:32:27 cost of goods sold is before I start
00:32:25 00:32:32 advertising if my product with shipping
00:32:27 00:32:34 cost 2294 to the customer and then my
00:32:32 00:32:37 cost of goods sold with shipping is ten
00:32:34 00:32:40 dollars I know that I had a thirteen
00:32:37 00:32:43 dollar and ninety four cent margin right
00:32:40 00:32:44 and then of course your fees come out of
00:32:43 00:32:46 that but really what matters here is
00:32:44 00:32:48 your cost per purchase I know I have a
00:32:46 00:32:52 thirteen dollar and ninety four cent
00:32:48 00:32:57 margin so now I understand based on that
00:32:52 00:32:59 margin where my cost per my cost per
00:32:57 00:33:01 purchase needs to be right it needs to
00:32:59 00:33:04 be under thirteen dollars and ninety
00:33:01 00:33:05 four cents for me to be profitable so it
00:33:04 00:33:07 all becomes about your customer
00:33:05 00:33:09 acquisition cost so this is your most
00:33:07 00:33:11 important number in business and in
00:33:09 00:33:15 marketing because this is how you scale
00:33:11 00:33:16 right so an example that I learned a
00:33:15 00:33:18 long time
00:33:16 00:33:21 go and I think has always been nice for
00:33:18 00:33:24 working is is understanding in terms of
00:33:21 00:33:27 like your your first of all you need to
00:33:24 00:33:29 have a target acquisition cost okay so a
00:33:27 00:33:31 lot of people tok about like you know
00:33:29 00:33:33 the question how do you price products
00:33:31 00:33:34 how do you price your product well this
00:33:33 00:33:37 is how you price your product right here
00:33:34 00:33:41 based on this formula okay you will get
00:33:37 00:33:44 your cost of goods sold first alright
00:33:41 00:33:51 and you have to look at the market price
00:33:44 00:33:55 point so say you're selling let's just
00:33:51 00:33:58 think of an example say you're selling a
00:33:55 00:34:01 backpack okay you're selling a backpack
00:33:58 00:34:03 your cost of goods sold with shipping
00:34:01 00:34:06 let's say the backpack is twenty dollars
00:34:03 00:34:08 in it and cost three dollars to ship it
00:34:06 00:34:10 a packet around the world alright so
00:34:08 00:34:11 your cost of goods sold plus shipping is
00:34:10 00:34:15 twenty three dollars
00:34:11 00:34:18 okay now you say the market price on
00:34:15 00:34:20 that is generally for comparable models
00:34:18 00:34:23 the market price is somewhere around
00:34:20 00:34:26 forty nine ninety five okay let's just
00:34:23 00:34:27 say fifty for making it easy so it's a
00:34:26 00:34:29 fifty dollar backpack to the end
00:34:27 00:34:32 consumer you're paying twenty three
00:34:29 00:34:34 dollars to fulfill that backpack means
00:34:32 00:34:38 you have a twenty seven dollar margin in
00:34:34 00:34:40 between right so now you know that based
00:34:38 00:34:42 on that twenty seven dollar margin you
00:34:40 00:34:47 need to have a customer a target
00:34:42 00:34:49 customer acquisition cost in that
00:34:47 00:34:52 situation you need to think about how
00:34:49 00:34:54 much profit you want to make okay so out
00:34:52 00:34:56 of that twenty seven dollar margin you
00:34:54 00:34:59 know you're gonna have some sort of cost
00:34:56 00:35:04 per purchase obviously so let's say you
00:34:59 00:35:07 decide my target is going to be fifteen
00:35:04 00:35:09 dollars okay your target customer
00:35:07 00:35:13 acquisition cost is $15 that would leave
00:35:09 00:35:14 you with $12 profit margin pure profit
00:35:13 00:35:16 margin for every product you sold that
00:35:14 00:35:19 would be a twelve dollar profit margin
00:35:16 00:35:22 out of a fifty dollar sale which would
00:35:19 00:35:22 be let's say let's
00:35:24 00:35:28 would be a 24 percent profit margin not
00:35:27 00:35:30 terrible right if you wanted to try to
00:35:28 00:35:36 keep it at a 30 percent profit margin
00:35:30 00:35:39 then you would have to do it at you have
00:35:36 00:35:41 to be making $15 per sale right which
00:35:39 00:35:44 means you would have to set your
00:35:41 00:35:46 customer acquisition cost at 12 dollars
00:35:44 00:35:47 that would be your target cost right you
00:35:46 00:35:49 see how that works so you're kind of
00:35:47 00:35:51 working backwards because you said okay
00:35:49 00:35:53 I'm gonna be selling this backpack for
00:35:51 00:35:56 $50.00 that's that's the fair market
00:35:53 00:36:00 value of this backpack and I'm sourcing
00:35:56 00:36:03 it for 23 so at that $27 margin I want
00:36:00 00:36:07 to make a 30% profit margin on this so
00:36:03 00:36:09 my target acquisition cost is $12 now
00:36:07 00:36:12 when you come over here and you have
00:36:09 00:36:15 your target acquisition cost your green
00:36:12 00:36:17 light to scale is going to be anything
00:36:15 00:36:19 that's less than that so if you start
00:36:17 00:36:24 marketing and you're getting sales for
00:36:19 00:36:26 $8 cost per purchase then you're in
00:36:24 00:36:28 you're in the green light scale scale
00:36:26 00:36:31 scale keep increasing the budget until
00:36:28 00:36:32 your cost per purchase gets to a point
00:36:31 00:36:36 where it starts to reach the threshold
00:36:32 00:36:38 yellow light right so you start to scale
00:36:36 00:36:42 naturally as you scale and start to
00:36:38 00:36:44 branch into a larger audience your cost
00:36:42 00:36:45 per purchase will increase okay because
00:36:44 00:36:48 you'll start running out of the most
00:36:45 00:36:51 dedicated buyers and you'll start
00:36:48 00:36:55 reaching into larger pools so say it
00:36:51 00:36:57 starts to increase and you get - now
00:36:55 00:37:00 it's rising it's rising it's go - it's
00:36:57 00:37:01 like at ten dollars okay so now it's
00:37:00 00:37:03 time to start slowing down a little
00:37:01 00:37:06 because you're quickly approaching your
00:37:03 00:37:08 $12 target cost right
00:37:06 00:37:12 and then the red light of course is
00:37:08 00:37:14 going to be if you are over your your
00:37:12 00:37:17 target cost so you you stopped you
00:37:14 00:37:20 started to slow down but another week
00:37:17 00:37:22 later even what's slowing down it's now
00:37:20 00:37:25 up to thirteen dollars you're no longer
00:37:22 00:37:29 profitable so it's time to cut that off
00:37:25 00:37:31 you need to know what your target cost
00:37:29 00:37:35 is now a few important notes to make on
00:37:31 00:37:37 this right is that number one number one
00:37:35 00:37:40 with your target cost
00:37:37 00:37:43 is going to be the idea that you can
00:37:40 00:37:47 adjust your adjust your selling price
00:37:43 00:37:49 okay to try to increase their margin so
00:37:47 00:37:50 that you can make more money right once
00:37:49 00:37:52 once you look at these numbers if you
00:37:50 00:37:54 say well there's just not enough profit
00:37:52 00:37:58 margin in here then increase the price
00:37:54 00:38:01 to try to bring your margin up all right
00:37:58 00:38:05 or also you can decrease the cost of
00:38:01 00:38:08 goods sold by sourcing directly through
00:38:05 00:38:12 you know through a company like wheel
00:38:08 00:38:13 but also when you start to get here to
00:38:12 00:38:16 your threshold you can do things like
00:38:13 00:38:19 change the offer or add a bundle offer
00:38:16 00:38:23 or add an upsell that helps to increase
00:38:19 00:38:25 the overall average order value to then
00:38:23 00:38:27 bring you back into the profitability
00:38:25 00:38:30 point so those are more advanced
00:38:27 00:38:33 concepts of how you can take something
00:38:30 00:38:35 and make it more profitable without
00:38:33 00:38:37 actually changing the customer
00:38:35 00:38:39 acquisition cost like the customer
00:38:37 00:38:41 acquisition cost might be what it is and
00:38:39 00:38:42 then if you still want to sell that
00:38:41 00:38:45 product and you believe in that product
00:38:42 00:38:47 it's your responsibility to either sell
00:38:45 00:38:51 the product for a higher cost or add
00:38:47 00:38:53 other elements into the offer that
00:38:51 00:38:57 increased the overall average order
00:38:53 00:39:00 value return on adspend
00:38:57 00:39:01 this is this is another important metric
00:39:00 00:39:03 because it references how much money
00:39:01 00:39:05 you're gonna make back for every dollar
00:39:03 00:39:07 you spend so if I spend a dollar in
00:39:05 00:39:11 advertising and I make back ten dollars
00:39:07 00:39:11 and that's a ten times return on adspend
00:39:14 00:39:22 here this year website purchased return
00:39:19 00:39:26 on that spin okay so this is a to 1.94
00:39:22 00:39:29 because my acquisition cost was twenty
00:39:26 00:39:32 dollars and I made back thirty nine
00:39:29 00:39:34 ninety eight so one point nine for which
00:39:32 00:39:37 the return on adspend on that example so
00:39:34 00:39:39 this is a number you want to be careful
00:39:37 00:39:42 about because it doesn't actually factor
00:39:39 00:39:44 in profit right and just seeing
00:39:42 00:39:46 somebody's return on adspend
00:39:44 00:39:48 like there's there's different levels of
00:39:46 00:39:49 awareness your return on adspend is
00:39:48 00:39:51 generally going to be much higher on a
00:39:49 00:39:55 retargeting ad than it is on a cold
00:39:51 00:39:59 traffic ad so it's a good metric to help
00:39:55 00:40:00 you monitor your performance but it's
00:39:59 00:40:02 kind of like take it with a grain of
00:40:00 00:40:04 salt if you see somebody else toking
00:40:02 00:40:05 about their return on adspend cuz
00:40:04 00:40:08 there's a lot of factors they could
00:40:05 00:40:10 affect this like if it's a hot audience
00:40:08 00:40:13 or cold audience it's a retargeting
00:40:10 00:40:16 campaign or you know different things
00:40:13 00:40:18 but overall it's a good indicator
00:40:16 00:40:20 because it can help you with your scale
00:40:18 00:40:24 and right you generally want to look for
00:40:20 00:40:26 ads that are like 2.5 return on adspend
00:40:24 00:40:28 or higher but mostly it's gonna come
00:40:26 00:40:31 down near profitability all right which
00:40:28 00:40:34 is why I tend to look at this as my
00:40:31 00:40:36 scaling metric okay I look at this
00:40:34 00:40:40 formula and I setup myself with
00:40:36 00:40:43 thresholds of understanding where you
00:40:40 00:40:48 know where my number needs to be in
00:40:43 00:40:52 order for me to scale profitably okay
00:40:48 00:40:55 now moving into this is the last thing
00:40:52 00:41:00 I'm actually gonna make this two videos
00:40:55 00:41:02 okay because from here I mean this this
00:41:00 00:41:04 is basically giving us all the stuff
00:41:02 00:41:06 moving into and toking about like
00:41:04 00:41:08 introductory stuff testing metrics and
00:41:06 00:41:11 now looking at customizing your ads
00:41:08 00:41:14 manager column and then from here we're
00:41:11 00:41:17 gonna get into actual testing strategies
00:41:14 00:41:18 okay so let's let's just look at this
00:41:17 00:41:21 vast part of customizing your ads
00:41:18 00:41:23 manager column alright and that's in
00:41:21 00:41:24 here you can see mines called custom
00:41:23 00:41:26 econ you can
00:41:24 00:41:27 the customize columns and basically
00:41:26 00:41:30 there's a few things that you want to
00:41:27 00:41:34 see all right this this is how I like to
00:41:30 00:41:36 have mine set up here and this is this
00:41:34 00:41:40 is what you can do over here okay you
00:41:36 00:41:42 scroll through you scroll through and
00:41:40 00:41:44 you can select which ones you want so I
00:41:42 00:41:51 like to see the amount spent the budget
00:41:44 00:41:54 the results cost per result delivery
00:41:51 00:41:58 impressions cost per impressions
00:41:54 00:42:00 frequency cost per post engagement
00:41:58 00:42:03 uniquely clicks okay this is not to be
00:42:00 00:42:05 confused with all right you see there's
00:42:03 00:42:07 many different types of clicks I like
00:42:05 00:42:10 unique link clicks because that's only
00:42:07 00:42:12 people who performed the the click once
00:42:10 00:42:14 right because if people click more than
00:42:12 00:42:19 once then that can be confusing so
00:42:14 00:42:24 unique link clicks cost per click call
00:42:19 00:42:29 I'm sorry cost per link click right here
00:42:24 00:42:31 CPC cost per click click CTR late
00:42:29 00:42:32 click-through rate and then these are
00:42:31 00:42:35 all your standard conversion events
00:42:32 00:42:38 website content views website add cards
00:42:35 00:42:41 website purchases then of course your
00:42:38 00:42:46 cost per purchase right here you're in
00:42:41 00:42:48 your standard events okay there's a lot
00:42:46 00:42:52 of them but these are the ones that I'm
00:42:48 00:42:54 looking at for e-commerce then your
00:42:52 00:42:57 website purchase return on adspend
00:42:54 00:42:59 and your website purchase conversion
00:42:57 00:43:02 value right so you would select them all
00:42:59 00:43:04 you can save it as a preset and name it
00:43:02 00:43:06 and then click apply and then you'll
00:43:04 00:43:08 have them all there so as you go through
00:43:06 00:43:11 these are all important in their own way
00:43:08 00:43:15 obviously amount spending budget so is
00:43:11 00:43:18 self-explanatory results will give you
00:43:15 00:43:20 all of your results right so here you
00:43:18 00:43:22 can come to see all the results based on
00:43:20 00:43:24 your conversion events how many people
00:43:22 00:43:27 Add to Cart and this year and checkout
00:43:24 00:43:29 purchased content views all of them are
00:43:27 00:43:31 here cost per result will give you the
00:43:29 00:43:34 one that you're optimizing for whatever
00:43:31 00:43:35 main optimizing for here
00:43:34 00:43:37 I like to see impressions because it
00:43:35 00:43:40 lets me know how many people might add
00:43:37 00:43:41 has reached cost per impressions we
00:43:40 00:43:43 already toked about that it helps you
00:43:41 00:43:46 see how expensive your ad is to run
00:43:43 00:43:48 frequency isn't as nice know because
00:43:46 00:43:51 frequency is how many times the average
00:43:48 00:43:53 person saw your ad so once your
00:43:51 00:43:56 frequency starts to creep up higher you
00:43:53 00:43:58 know then 2 or 3 you want to be watching
00:43:56 00:44:01 that because it means there's you should
00:43:58 00:44:06 probably refresh the creative or or
00:44:01 00:44:08 change up the change of the marketing
00:44:06 00:44:10 because they're starting to see that ad
00:44:08 00:44:12 a lot the high frequency okay
00:44:10 00:44:14 cost per post engagement doesn't matter
00:44:12 00:44:16 as much I just I just have it there
00:44:14 00:44:19 because if I'm running an engagement at
00:44:16 00:44:20 than I like to see you know what my
00:44:19 00:44:22 engagement cost is but when you're
00:44:20 00:44:23 running a conversion at generally your
00:44:22 00:44:25 engagement cost is going to be higher
00:44:23 00:44:27 because that's not the objective and
00:44:25 00:44:29 then we already toked about unique link
00:44:27 00:44:32 clicks cost per lead clicked
00:44:29 00:44:34 click-through rate these helped me see
00:44:32 00:44:36 like before you have a purchase these
00:44:34 00:44:38 are all really good numbers to help me
00:44:36 00:44:40 know if my ad is running well if I've
00:44:38 00:44:42 been running an ad and I'm getting no
00:44:40 00:44:44 clicks then I know it's not worth
00:44:42 00:44:46 continuing to run that ad but out if I'm
00:44:44 00:44:47 getting if I'm running an ad and I don't
00:44:46 00:44:48 have any purchases yet but I've been
00:44:47 00:44:50 getting a lot of clicks and I have a
00:44:48 00:44:53 great click-through rate and I have
00:44:50 00:44:55 website content views and I see people
00:44:53 00:44:56 are starting to Add to Cart then I know
00:44:55 00:44:58 this ad is worth continuing to run
00:44:56 00:45:00 because Facebook is just now wearing a
00:44:58 00:45:02 it's narrowing in and starting to find
00:45:00 00:45:04 the most likely people and eventually I
00:45:02 00:45:06 should start to get some purchases okay
00:45:04 00:45:08 and then once you do get your purchases
00:45:06 00:45:12 you're using cost per purchased return
00:45:08 00:45:15 on adspend to measure if it's actually a
00:45:12 00:45:18 profitable if it's a profitable ad that
00:45:15 00:45:19 you can continue scaling or if you have
00:45:18 00:45:22 to make adjustments in your funnel to
00:45:19 00:45:25 make it profitable alright
00:45:22 00:45:27 so that's everything for this first part
00:45:25 00:45:28 now we're gonna in the second part we're
00:45:27 00:45:32 going to come back and start toking
00:45:28 00:45:32 about the actual testing strategies

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