This article will outline our repeatable step-by-step process of how we scale our clients’ eCommerce businesses to 7 and 8 figure revenue using Facebook Ads.
Now, there will be no motivational BS or useless info you already know - just pure practical & tested knowledge that you can start implementing right now.
And we’ll even cover our 5 step scaling formula that was the backbone of our scaling success.
The results?
$506,555.33 from $156,696.70 in our first 28 days working together (during Dec 18th to Jan 16th) = 3.23X ROI
And as of March 2020, they are currently generating $30-35k in daily revenue with ±3X ROI
Most of the growth started just AFTER Christmas and continues to this day (as of March 2020).
Meaning, we’ve successfully avoided the post-Q4 sale slump.
So what’s the 5 step scaling formula?
1. Setting Yourself Up For Success
Before we started working with this client, their revenue would vary constantly.
Over a year the maximum daily revenue they were able to generate (excluding BFCM) was around ~ $15k - $16k. However, this was unsustainable.
Why?
One word: Consistency (or lack thereof)
If there’s one mistake we see e-commerce founders often make is that you can’t do everything perfectly all on your own.
And we get it.
You have to develop new products.
You have to hire new staff members.
You have to think about the bigger picture.
And the last thing you want to do is to sit at the Ads Manager setting up new campaigns, developing briefs and guidelines for the creative team, and waiting for the Ads to be published.
So, the only thing that was left to do was to develop a structure and system for repeatable and consistent growth.
Since our daily ad spend from the beginning was around from $3k to $4k. We knew that only fast, disciplined, and quality work would only let us increase our daily ad spend fast while sustaining our goal ROI = 3x+.
To achieve that, here’s what we had to do...
Collaborate with the client’s in-house creative team and our own creative teams to develop a large quantity of new creatives with different angles, quickly.
Spend at least 10% to 30% of our daily budget on testing campaigns. (It really depends on your daily ad spend. (For example: If your daily ad spend is around $4k, we would suggest you to spend at least 15% of your ad spend on testing.)
Implement profitable email automation flows into our customer-centric marketing funnel with constant a/b testing to find the best converting email marketing combinations.
Use CBO as our main scaling machine and let the algorithm optimize for maximum conversions.
Test as many different visual formats, placements, headlines, thumbnails and everything you can think of in our top of funnel campaigns with our second-best audiences.
2. Developing & Testing New Creatives Fast
Our creative process began with analyzing customer reviews, behaviors, buying patterns and yes, even their Instagram profile posts with the tagged products to understand their motives behind making the purchase.
This allowed us to understand the most prominent benefits and craft copy based on customer data using their exact tone of voice…
While looking at the negative reviews helped overcome their fears of the most undesired outcomes ;)
Why this approach?
You see, the top-performing copy piece wasn’t thought out or written by our creative geniuses...
It wasn’t even stolen from our competitors and adjusted to our brand. It was an exact, word-for-word piece taken from one of the product reviews.
And even though we’re testing a bunch of new copy angles daily, this one still performs like no other.
That’s the power of doing customer research properly - there’s no shooting in the dark.
And what about the competitor ads?
Of course, looking at the angles of our top competitors is also key to coming up with different creative angles.
As Pablo Picasso once said, “Good artists copy; great artists steal.”
Adjust the angles to your brand, let your imagination go wild and test as much as possible.
Get into a habit of going through the customer data, competitor ads, buyer Instagram accounts, and you’ll soon develop more empathy for the customer which equals you building better and stronger ideas that actually convert.
All that’s left to do is to create and shoot the visuals and write the copy to test it out.
Here’s our process of testing and scaling creatives
Last year all of our tests were done with ABO (Adset Budget Optimisation), but since CBO (Campaign Budget Optimisation) was showing significant results in scaling campaigns, we’ve decided to give it a try for CBO in testing also.
Before that, we were mostly testing around 40-50 creatives at the same time every day with ABO and the whole path from testing to scaling would be very unprofitable.
And yes, the main point of testing campaigns is to find the winning creatives, but we decided to let go of our ego and let Facebook decide what’s best for us.
And it proved to be very successful.
When we were using ABO for testing, we would have around 1.0-1.2 x ROAS. With CBO we are having around 1.6-2x ROAS.
It is still costly, but now our tests have a far smaller impact on our client’s cash flow.
The testing campaign’s module, it is structured this way:
We take the second/third best-performing audience and we test every ad with the same audience.
Why not the best performing audience?
Because we do not want to harm and saturate our best-performing audience, so that’s why we prevail ourselves.
Example:
Campaign: *campaign name*:
Adset #1 - *Adset name (Audience)* - Ad name
Every specific ad with different ad versions (copies, thumbnails) is tested per ad set.
After testing is complete, we set the campaign budget following this formula - Adset number multiplied by 2x Breakeven CPA.
So, for example if your breakeven CPA is $30 and you are launching 10 different ads in your testing campaign, your campaign’s budget should be - 2x$30x10 = $600.
Quick tip
Put at least a $10 limit on every adset. We are letting CBO run the campaign and due to Facebook’s algorithm, some of the adsets might be stuck at a $0 spend and if so you won't know if that ad is a winner or not. In short, make sure to start every adset’s engine.
The process of deciding whether the ad is a winner is simple. We analyze our key metrics: Cost per acquisition (cost per result), cost per landing page view, cost per add to cart, cost per initiate checkout, ROAS, and purchases.
If those KPIs are suitable & profitable for us, we duplicate the ad to our scaling campaign, if not we look deeper into our KPIs and we decide whether the ad is worth another try with different copy or thumbnails. If not, it is abandoned.
That’s it. If you are ready to scale fast you have the blueprint.
Rinse & Repeat.
3. Monetizing Current Traffic Through Email Marketing
Relying solely on Facebook/Instagram Ads is way too risky with some ad accounts being banned for apparently no reason.
And actually nowadays, way more difficult due to rising CPMs.
So, a sound email marketing strategy gives you more room to spend and scale faster because you convert more of your traffic.
The following few paragraphs will show you how we increased a client’s email marketing revenue from 6-7% to 20-22% by simply adding a few emails into the flow and building trust and relationship with the customer.
And you’ll also get insights into how we do A/B testing for these flows.
BEFORE:
(Nov 1st - Nov 30th with Black Friday results)
AFTER:
(Dec 18 - Jan 16th)
Abandoned Cart Automations
We started with optimizing the abandoned cart email automation flows since they are the most profitable email automations and bring the most ROI.
This is how the abandoned cart automations looked before we upgraded them.
Email #1. Reminder about abandoned items at the checkout
(No discount in the first email - just a simple reminder on the first email which gets the most open rates. Only reminds me about what I left behind)
Email #2. Reminder about abandoned items at the checkout + 10% off discount
(After a day we got a discount on items we abandoned. I might have already forgotten about this brand and the item I wanted to buy or even worse - bought it at a cheaper price from another brand)
Email #3. Reminder about abandoned items at checkout + urgency on 10% off discount
(On day 3 we got an urgency email on a 10% discount code. My interest in the product might be gone or I have purchased from another brand)
In other words, basic and nothing special.
Here’s how we made it better.
First of all, because our target audience was women aged 18-35, our main goal was to make the abandoned cart emails feel more natural, simple, clear, and beautiful. That’s why our customer research & analysis was crucial to the email copy building process and it allowed us to connect on a deeper level with the buyer, overcome their objections, and build trust with the brand.
Secondly, because we had numerous different subject lines for every single email in the flow we decided to test them with the A/B testing feature. Every email had 2 different subject sines and the testing period for the subject line was a couple of weeks. After 2 weeks we took a winner subject line based on open rates and tested it once again, but including an emoji in the same subject line. After 2 weeks we got the winning subject line which is the final for that particular email on the flow. Rinse and repeat.
The main goal behind that 4 week testing period was finding the best performing subject line and boosting email open rates.
Third, we decided to test the best timing to send the Abandoned cart emails. This is how our timing looked:
Set A:
First email is sent one hour after leaving a cart
Second email is sent four hours after the last email
Third email is sent nine hours after the last email
Fourth email is sent sixteen hours after the last email
Fifth email is sent one day after the last email
Sixth email is sent one day after the last email
Set B:
First email is sent one hour after leaving a cart
Second email is sent twelve hours after the last email
Third email is sent one day after the last email
Fourth email is sent one day after the last email
Fifth email is sent one day after the last email
Sixth email is sent one day after the last email
After a month we noticed that the first 3 emails in both Set A and Set B performed similarly and had almost the same open and conversion rates…
However, the last 3 Set A emails had conversion rates twice that of the Set B emails.
Here’s a little sneak peek of how we structured our Abandoned Cart email sequences.
Email #1. Reminder about the abandoned product + an immediate 10% discount off of the order.
(Because of the huge open rates on the first sent “Abandoned cart” email and and the price being the biggest objection when buying an item, we decided to give an immediate 10% off discount code and dramatically reduce abandoned cart numbers from the first email by maximum)
Email #2. 3 Customer testimonials + abandoned product + follow on Instagram for a follow offer.
(Showing testimonials of other happy customers + offering to take a picture with their purchase and post it on Instagram tagging our brand for a shoutout, was a part of building a relationship and trust with our customer)
Email #3. “Email from owner” offering help with the abandoned cart + a reminder about the 10% discount
(In this email we try to gain even more trust from the customers by offering them help with their abandoned product. This email stands out from the others because it’s a plain text email with no design. The customer feels like they are getting an email from the store owner)
Email #4. Reminder about the abandoned product + urgency on the 10% discount.
(Saying it's the “last day” to complete the order with the 10% discount and motivating the customer with an expiring cart)
Email #5. “Email from owner” reminding them about the abandoned cart + the 15% off
(An owner type email - offering an exclusive bigger discount if they complete the purchase right now)
Email #6. “Email from owner” reminding them about the abandoned cart + urgency on the 15% discount
(An owner type email -stating that the customer has 6 hours remaining to complete their order and still receive the 15% discount)
Welcome Email Automations
Once the abandoned cart email automations were up and running we started optimizing the welcome emails.
Our goal with the welcome email automation flow was to build trust and relationships with our customers. We mainly focused on giving free value content and educating customers about the brand.
Our welcome email automation flow was triggered when the buyer opted in through an installed footer opt-in or a spinner pop-up. They were sent an immediate 10% discount.
Here’s how our emails looked like:
Email #1. Welcome our new subscriber and give them a 10% discount
(Saying thank you for subscribing to our email list and starting a relationship)
Email #2. Remind subscribers about the 10% discount with an urgency email that the discount expires in 48 hours
(Create a sense of urgency and fear of missing out)
Email #3. Content email with customer testimonials.
(Building trust)
Email #4. Content email that helps subscribers choose the correct product type.
(Building relationship with a brand)
Email #5. Content email that helps subscribers to choose the preferred product color.
(Building relationship with a brand)
Email #6. Discount email giving a bigger discount for those who completed the flow
(Starting a discount ladder strategy. After 3 content emails we offer a special 15% discount as a thank you for staying with us)
Email #7. Discount email giving an even bigger discount for those who didn’t use the last discount
(Ending discount ladder strategy. Giving an even bigger discount last chance offer for a first purchase)
4. Creating Profitable Retargeting Setups
When it comes to the middle of the funnel, it really depends on your customer journey.
You have to analyze such factors as…
Are your buyers an emotional purchasers or well-educated ones?
How long does it take to make a decision regarding completing an acquisition?
Is your product price high?
What are the hidden angles and objections that influence the buying decisions?
Why?
Because there’s a big difference in how you should set up retargeting campaigns for skincare brands as opposed to fashion apparel brands.
In our case, with a fashion brand, besides the obvious emotional side, there was also a hidden practical angle that justified a lot of buying decisions.
And of course, we had to show the legitimacy of the brand by showing a lot of social proof, brand awareness videos, proof of the practical benefits, and more angles to overcome as many objections as possible of the potential buyers.
After a lot of tests, we noticed a pattern, that the best time period to “close” the customer was straight after they enter our marketing funnel (visit our website)...
So we allocated the majority of our retargeting budget (30-40% of our daily ad spend) to the first 3 days after they visited our website.
Meanwhile, we set up separate campaigns that target website visitors from 3 to 180 days with almost the same content and giving them separate budgets so we are able to scale those audiences differently.
After to website visitors, there are Instagram and Facebook engagers/video viewers. This type of audience is also very important, because they are already warm, and people in this audience convert easier.
From the content side, we may make small changes, but most of the time the content is the same.
The main thing is to have a separate budget for this type of audience so you can scale it wisely.
Bottom Of The Funnel.
The most important thing here is to close the deal and make potential clients pay.
Best way of doing that?
Give them a deal.
Since this part of the funnel is customers, who have recently added to their cart or tried to checkout, the final step to make a purchase should be a very short path. So we aggressively push deals on earlier mentioned audiences.
Our BOFU we divide into two segments: Added to cart in last 1 day range & added to cart from the last 2 to last 7 days time range.
The very first day we give them 10% OFF and we seek the instant reaction from the potential customers. For the rest of the funnel (ATC 2-7 days) we give them 15% OFF as a final discount.
From the creative’s perspective, we mainly push DPA and image designs with personally directed ad copy. Simple as that.
We believe that the bottom of the funnel is the easiest part. The only thing that you need to be aware of is whether or not your product is purchased most of the time is purchased based on customers' emotions most of the time?
If yes, close them ASAP, if not build a longer funnel.
5. Scaling Simplified
Almost everyone (ourselves included) used to do very structured scaling campaigns and made it look difficult.
And it’s understandable because everyone was following the same Facebook ads blueprints for a long time.
Using many different varieties of lookalikes and interests was our only scaling know-how...
But over the last couple of months, we are seeing that believing in Facebook’s algorithm gets us very good results, so as it was with the usage of CBO in testing campaigns, we are facing the exact same situation here.
Therefore, we’d like to call our scaling strategy - Scaling Simplified.
Of course, it depends on what kind of creatives you are mainly pushing for scale, but let’s look at an example - a scaling campaign for video ads (feed & story creatives included).
Our campaign structure would look like:
Campaign: Scaling Campaign
Ad Sets: 1. Super Lookalikes - Feed (In this adset we put all our best performing lookalike audiences and winning video ads that are made only for FEED)
2. Super Interests - Feed (In this adset we put all our best performing audiences that are based on interests and winning video ads that are made only for FEED)
3. No Target - Feed (In this adset we do not put any LLAs or interests, we just adjust our demographics and geographics and winning video ads that are made only for FEED)
4. Super Lookalikes - Stories (winning video ads that are made only for STORIES).
5. Super Interests - Stories (winning video ads that are made only for STORIES).
6. No Target - Stories (winning video ads that are made only for STORIES).
Budget: From 10x to 20x your breakeven CPA - It really depends on how much you are able to spend daily and other circumstances (timing, your ad account performance and etc.)
EX.: If my breakeven CPA is $30, the scaling campaign’s budget would be 20x$30 = 600$.
Moreover, if your campaign is performing well (outreaching your main KPI goals) I would increase the budget gradually by 20-30% every time.
Budget: From 10x to 20x your breakeven CPA - it really depends on how much you are able to spend daily and other circumstances including timing, your ad account performance, etc.
For example: If my breakeven CPA is 30$, the scaling campaign's budget would be 20 x 30$ = 600$.
Moreover, if your campaign is performing well (outreaching your main KPI goals) I would increase the budget gradually by 20-30% every time.
The percentage would be lower, if the campaign's budget is really high - $3k or more.
Quick tip
Try to keep everything in one campaign and do not scale with multiple different scaling campaigns. Every campaign is storing a large amount of data and you do not want to distribute that across many different campaign’s, because the performance will be affected.
There is an exception to this rule. Split your best-performing image ads and best-performing video ads into two different, albeit identically structured campaigns, because Facebook is most likely to give all the spend to the images ads rather than video ads.
Furthermore, your winning creatives in scale status will slowly start to under-perform so you have to constantly analyze their KPIs - if they are profitable to you, you keep them in the scaling campaign, if not - shut them down.
Remember that low-performance results have to be consistent before making a decision, sometimes there are days that ads are not performing unrelated to marketing. Analyze creatives in a scaling campaign with the perspective of the last 7 days.
What’s next?
To sum up, 2020 will be a hard year for e-commerce owners especially with rising CPMs and fierce competition.
And the key aspects to focus on this year if you’re an e-commerce owner:
Monetizing the current traffic as much as possible
Creating and testing new killer creatives FAST
Having a sound Facebook Ad setup that consistently brings repeatable results
Thinking about the bigger picture - developing new products, entering new markets, and etc etc.
Why
If you’re an e-commerce owner that’s wasting time on the little details. Such as MOFU or BOFU ad setups, briefs for the creative teams, setting up email automations or doing customer research for ad copy.
You almost guarantee that you will be unable to grow your business, with competitors outperforming you.
That’s why you need an A-level team at your disposal to do all the detailed and time-consuming tasks.
A team that’s available 24/7, even on Sundays.
A team that gets paid by the value that they bring, i.e. a percentage from the store’s revenue.
Either way, that’s us.