Collin Turner from CTMarketing recently shared a case study in which he revealed the tactics that his team used to scale his client's gross sales to $235 000 while maintaining a BROAS of 3.9x, all while spending just $60 000 on Facebook ads.
In this article, we will explore the Facebook media buying tactics employed by Turner and his team that resulted in these results. He also goes further ahead to talk about AI and the future of targeting in Facebook Ads.
About the Client
Collin says that his client operates in the tactical niche, and his team focused solely on top-of-funnel traffic on Facebook. They also used email marketing but did not utilize Google or TikTok. The client's average order value is approximately $150, and their conversion rate hovers around 1%. Although the CVR may seem low, the high AOV compensates for it. Now, let's dive into the tactics that were employed.
Testing Creatives and Ad Sets
To reach a monthly revenue of $235 000, Collin and his team conducted extensive audience testing a few weeks ago. Testing different audiences, including LLA's and Interest audiences at the top of the funnel (TOF) is essential. It is also crucial to test ad sets until they have at least 8-10 ad sets that perform well consistently. To maintain consistency, the creatives should be the same on every ad set, and each ad set should not have more than five creatives at a time.
It's important not to conduct a creative testing campaign and an audience testing campaign at the same time. The approach Collin and his team use is to test specific matchups of creatives (3-5) with specific audiences to find 8-10 consistently profitable audiences that work well with the same creatives.
Simultaneously, they can test other creatives inside an open targeting campaign, but they prefer to take those that perform well and test them with new LLA's/interest audiences. They don't keep them in open targeting ad sets indefinitely. For their clients, they run open targeting, but it counts as one winning ad set, not the only audience they target. Although some accounts can scale with just open targeting, most need to target interests and LLA's at the TOF level.
Collin and his team test ad sets at $15 per day for clients with a $50 AOV or less. For this particular client, they tested at $50 a day due to the higher AOV. Higher AOV stores have fewer daily orders, so to save time, they tested with higher budgets.
After an ad set has spent money for three days, they decide whether to keep or cut it. If they keep it, they issue a "stress" test and increase the budget by 20%. They stress the ad set for 48 hours, and if the ROAS holds, they declare it a winner and move it to part two.
Scaling Winning Ad Sets
After identifying successful ad sets on Facebook, it's crucial to take a gradual approach when scaling them up. The strategy involves increasing the budget by 15-20% each day that the ad set continues to perform within their Key Performance Indicators (KPIs). An Ad Set Budget Optimization (ABO) approach is used for scaling, but it's also possible to use Campaign Budget Optimization (CBO). It's important not to turn off testing ad sets until the CBO consistently generates profits with a daily budget of $250.
If you switch to CBO and turn off testing campaigns too soon, you risk encountering problems if the CBO doesn't perform as expected. Once the CBO generates consistent profits at $250 a day, you can turn off the ABO testing campaign and gradually increase the CBO budget by 15-20% each day until the performance drops. If the campaign stops performing well after being scaled, you should gradually reduce the budget by 10% each day until it becomes profitable again. Therefore, it's important to scale up and down slowly to avoid going out of KPI.
Best Retargeting Strategies and How to Scale MOF/BOF
Retargeting is an essential part of Facebook Ads for e-commerce brands. To help you structure your campaigns, here's a breakdown of the Middle of Funnel and Bottom of Funnel campaign structures that Collin and his team used.
For the Middle of Funnel campaign, they recommend a minimum daily budget of $100 with automatic placements and bids. There are six ad sets to choose from, each targeting a different audience:
- Ad set 1: Targeting 95% of video viewers in the last 365 days
- Ad set 2: Targeting users who engaged with your Instagram profile in the last 365 days
- Ad set 3: Targeting users who have viewed 75% of your videos in the last 180 days
- Ad set 4: Targeting users who viewed your videos for at least 3 seconds in the last 180 days
- Ad set 5: Targeting users who have engaged with any page post in the last 365 days
- Ad set 6: Targeting users who have viewed 50% of your videos in the last 180 days
*Note that all ad sets exclude website visitors and purchases made within the last 90 days.
For the Bottom of Funnel campaign, they recommend a minimum daily budget of $100 with automatic placements and bids. There are three ad sets to choose from:
- Ad set 1: Targeting all website visitors within the last 60 days (excluding purchases made within the last 180 days)
- Ad set 2: Targeting users who added items to their cart within the last 60 days (excluding purchases made within the last 180 days)
- Ad set 3: Targeting users who viewed content on your website within the last 60 days (excluding purchases made within the last 180 days)
Collin Explains this Scaling Strategy Below:
It's important to scale your Bottom of Funnel campaigns while scaling your Top of Funnel campaigns. If your Middle of Funnel campaign doesn't perform well, don't worry. We've seen this campaign perform well for some clients and not for others. If it doesn't work for your account, try a modified Middle of Funnel campaign where all engagements (Facebook + Instagram | 60 days), Video Views (50% | 60 days), and any post or ad engagements (Facebook + Instagram | 60 days) are combined into one ad set. Start with a budget of $50 a day and scale up until you see performance drop.
The biggest mistake we see people make with these campaigns is not scaling them. As long as you're pushing more budget through your Middle of Funnel and Bottom of Funnel campaigns, you'll have bigger audiences to target. Make sure you're utilizing their size and spending more money on these campaigns.
You don't have to be as conservative with your budget either. As you increase your Top of Funnel budget, wait a few days and bump up your retargeting budget by $100-$200 per day. Scale your Top of Funnel campaigns first, and then scale your Bottom of Funnel and Middle of Funnel campaigns.
Collin Turner
The Future of Audiences and AI
As Facebook Ads continue to evolve, the strategies used to reach clients' desired results are also evolving. Audience-building AI is a new tool that we are beginning to explore. This technology is capable of tracking the most valuable customers and using their data to create custom audiences that can be retargeted and used to create Lookalike audiences. With this tool, we can discover more profitable audiences to be used on Top of Funnel and Bottom of Funnel campaigns, leading to more profitability and scalability.
Looking to the future, AI is likely to play a more significant role in ad targeting. As we gain more insights into how AI can help us target the right audiences, audiences will become more profitable, consistent, and able to handle greater scale.
At present, the tool we are using is called Enhancer. However, this is just the beginning.
There are already AI systems available that can track various metrics at the ad level. The most valuable AI systems will be those that can help us target specific audiences. It is possible that in the future, we could target an audience of 1 000 000 people who are actively searching for a specific product in real time. This could be significant because it removes individuals who are not part of the target audience, providing more control at scale and avoiding low numbers.
Conclusion
By following the strategy laid out above Collin Turner and his team were able to scale his client's s sales to $235 000 in one month while spending just $60 000 on Facebook ads.
