October 01 0 183

How to Control Campaign CPA prices on Facebook Ads

Today we are bringing you a Facebook marketing case study from Max Berezovskiy, the CEO of ScaleX agency. In this case study, he was able to generate $71 000 in revenue for his client with a 2.84 ROAS using Facebook ads.

We are also covering his media buying approach and the issues he faced while running this campaign. And finally, how he solved them in collaboration with his client.

Brief Campaign Details

  • Niche: Beauty and Personal care
  • Market: USA
  • Revenue: $71 650
  • Ad spend: $25 659
  • ROAS: 2.84
  • Period: 1st January — 31st January 2021

Client's Problems

  • The main problem for him was how to scale and control CPA without losing ROAS.
  • Huge overlap between active ad sets (from 35 to 46%).
  • Retargeting didn't give good ROAS, CPA, and number of purchases.

Main Client's Aims

  • ROAS 2.2-2.5.
  • CPA not more than $35.
  • Control CPA within the KPIs after scaling.

Retargeting Structure

Max’s retargeting funnel was classical. It was comprised of the visitors who went through the following stages:

  • those who interacted with the brand’s Instagram/ FB page in the last 7 and 14 days;
  • then viewed the product card in the previous 0-7 and 0- 14 days;
  • then added them to the cart in the last 0-7 and 0-14 days;
  • then added their payment info in the last 0-7 and 0-14 days.

The retargeting principle was to set up and build a separate communication for each step of the funnel. Do not forget to change the optimization, depending on the funnel's step — the lower the stage, the lower the optimization.

In this project, Max spent more on retargeting than on prospecting — 35% of the budget on prospecting and 65% on retargeting.

The reason for this was because the client had a lot of data for retargeting, but didn't have the proper structure. So, he decided to allocate more to retargeting.

Prospecting

On this project, Max didn't utilize interests, behaviors, etc. He created a lookalike audience, which was based on purchasers for the past 60 days.

Lookalike audiences were next: 1% and 1-3%.

Max also excluded the 1-3% lookalike audience from 1%, and also the lookalike audiences’ source. This helps to prevent an overlap between them.

"A lookalike audience will not perform well if you use a large gap. This is because this audience most likely might have changed their interests. Try to use the shortest possible period, and don't forget that you must have more than 1 000 people for a high-quality lookalike audience. That's one of the crucial things!”, Max explains.

Smooth Scale

On this project, Max left 30% of the budget for testing and 70% for scaling.

How to Leverage Quora to Boost Your Website Traffic by Over 100%

As soon as Max saw the audiences generated the most sales and revenue, he rose the budget to 30-40% per day from the original figures. He scaled the campaigns smoothly because usually, the Facebook algorithm doesn’t know who to show ads to at first (because of the learning phase). It does that to everyone, and then the price for the result ends up being sky-high.

Therefore, it is necessary to leave the learning phase and scale slowly. Otherwise, everything may "break down." Especially it concerns Cost Cap bids. Even if you use it, increase your budget smoothly as well.

One of the most exciting parts of this case study is that Max used the Cost Cap strategy.

Why and When to Use Cost Cap?

Why? When you go through learning and start scaling, in time you will notice that your CPA will keep on increasing. That's a normal situation, even after the learning phase. Cost Cap helps us to control CPA and keep it within the KPI.

When and how to properly use Cost Cap, and the disadvantages of using this bidding strategy:

  • When to utilize Cost Cap

When you see that your CPA exceeds your KPIs frame, the Cost Cap helps us to control CPA.

  • How to use Cost Cap

Cost Cap always uses only when you go through the learning phase and start scale. If you want to use it before the learning phase, your campaign doesn't give you a good ROAS and enough purchases.

  • Disadvantages

The main disadvantage of Cost Cap, when compared with the lowest cost, is that Cost Cap cuts off the number of purchases. The system needs to get results that do not exceed your CPA. If you decide to use Cost Cap, do it with a reasonable budget.

Deep Retargeting Structure via Facebook Analytics

Max used audiences with the following filters:

  • people who view a page more than 90% of others for the past seven days;
  • people who view content more than 90% of others for the past seven days;
  • people who add to cart more than 75% of others for the past seven days;
  • people who initiate checkout more than 75% of others for the past fourteen days;
  • people who bought goods with discounts for the past 90 days.

Copies for Retargeting

All of the ad copies were not longer than 4-5 sentences. For engaged with FB and Instagram, page views, and website visitors, Max used general information about the catalog/ free shipping certified in the US.

For View content, he utilized more personalized texts whereby he highlighted the main advantages of the client's products and offered a 12% discount if the visitor spends more than $65.

For Add to cart audience, Max included a statement saying that "You almost bought!"

$116 000 in 48 hours from TikTok and Shopify

For the initiate checkout stage, it was a very similar text, but Max used the statement saying, "Your beauty is almost at your place, just a little bit is left to complete your order."

Special Offers (Promo Codes) for the Audience through FB Analytics

The lower along the funnel, the greater the discount Max offered:

  • PW -5%
  • VC -7%
  • AC -10%
  • IC -12%

Max started to use discounts from the start (via FB Analytics) because these audiences need a strong trigger. And the lower the step, the greater the discount.

Also, don't forget to change communication for every step.

Catalogs

For prospecting, Max utilized a general catalog (through catalog sales objective).

For engaged/page view/website visitors — bestsellers/ new products for the past 30 days.

For View content, add to cart, initiate checkout — DPA.

And for the Audience via FB Analytics with DPA as well.

Previous Customers
For previous customers for the last 90 days, Max used a catalog with new goods and bestsellers. He also excluded purchasers of the last 30 days (to propose relevant items for the relevant audience).

For previous customers who bought items with discounts, he proposed new goods with discounts and relevant messages.

He also used Reach optimization for this step in order not to cut off his precious audience.

Summary of What Was Done

  • Effective retargeting and acquisition structure;
  • Cost control after scaling;
  • Excellent communication for every stage;
  • Competent work with hyper-segmentation.

Achievements

  • ROAS: 2.81
  • Spent: $25 659  
  • Conversion Value: $71 650
  • Average CPA for acquisition: $33.88

Conclusion

The key point to take away from this case study is how to use the Cost Cap bidding strategy to regulate your CPA on Facebook ads. Once you are able to keep your CPA low and well regulated, you can have a predictable ROAS for a long period of time.

$83 000 in 1 Month with a New Shopify Store Using Facebook Ads

This is the exact strategy that enabled Max to solve the problem of increasing CPAs for his client while scaling the campaigns. And then being able to generate $71 000 with a steady 2.84 ROAS.

How do you like the article?