What can you 10x? What can you not? Always ask this question whenever you’re trying to do a ton of different things in your business, which by the way you should all the time.
For Facebook ads strategy, my phase 1 is always trying 10 different ad-sets targeting different interests each with multiple ads inside each ad-set.
The phase 2 is simply finding what you can 10x and what you can’t. You trim the fat, you drop the ones that didn’t work, and double-down on the ones that did. The same dead simple concept should be used in all businesses.
I spoke to a friend who helps businesses initiate email marketing automation, improve delivery rates, create email sequences that work and more. Over the years he grew his customer base to over 1000 businesses but still struggled with making the profit the way he intended. Until he asked himself the 10x question.
He simply looked into his customer-base and identified that bloggers aren’t working at all for him. They simply are churn and burn for his business. All the customer acquisition till date for acquiring bloggers has been a waste of time and money. He also looked into his highest ROI generating subscribers which turned out to be Shopify stores. He cut his spending by 100% on blogger acquisition and doubled down on Shopify stores. A few months later, he found himself making the profit the way he intended.
While it sure is dead simple and almost stupid to highlight the obvious rule, many people actually struggle with identifying the parts that can be 10x’d. It gets easier to spot those when you ask the 10x question more often. In my friends case, he had to manually dig deep into his customer-base to get the information on what type of customers worked for him and what didn’t. He did that because he asked himself that question. He also realized that he should be collecting this information about his customers as part of the on-boarding process so he can fingerprint his customers better.
As a general rule always try a ton of different things in your business, trim the fat, and double down on the rest.
If you’ve previously run Facebook ads, or have watched some of the content to learn to do so, you may know about the 20% rule. If you don’t, here is what it is; many people recommend to bump your budgets by 20% a day in order to scale your ads without ruining or reseting the optimization.
This isn’t broscience as there’s a “last significant edit” column in the ads manager and any bump in budget greater than 50% triggers the last significant edit and resets the optimization. This is even more trouble-some for CBOs which you often really want to scale as they have several ad-sets and audiences that are ready for larger budgets after you’ve proven your original thesis.
Alex from GetNotissed has worked a simple work around for CBO scaling which seems to work in most cases and I’ll explain that in a bit. The 20-50% budget raise without triggering reset is a guideline given directly by Facebook. However, the fact that we associated a time-window with it was how we perceived that guideline. In other words, you can do multiple 20% raises each second to reach your desired budget in a minute instead of doing 20% raise/day.
So you can go from spending $100 per day per CBO to $500 per day per CBO, without triggering a reset, in 1 minute instead of 9 days as long as you do multiple edits of 20% each. Be sure not to directly raise your budget from $100 to $500 which obviously will trigger the reset.
In my personal test, the theory worked great but I’d still not advise making extreme budget raises using the 20% per second rule.
The past few days I have been working on a highly competitive product that I know hundreds of sellers are working on. There’s demand for it, but the product has lower sale price of $20 and is competitive to sell with paid media.
After analyzing competition and discussing strategy with Saad, I decided to sell the product in non-mainstream geolocations primarily targeting middle-east. This allowed us to generate sales at cheaper CPA than US/UK/CA/AU/NZ/EU and we were able to scale freely in untapped markets.
Sales from Middle-East, Asia, Africa & South America costed us 25% less and also accounted for 48% of total sale volume with US only accounting 17%.
Our average order value was 40% higher in Qatar and UAE in comparison with average of all other geolocations. 8% of our sales came from Mexico. We also received substantial volume from Chile, Hong Kong, Taiwan, Brazil, Oman, Bahrain and Caribbean states.
Our seed data was built using Singapore and Hong Kong which I think have high conversion rates and purchasing power. The seed data was then used to create custom audiences and lookalikes to scale in all other locations.
Over-all I’m really excited by the new avenues this unlocks because a few years ago, I couldn’t have imagined this. Selling in these geo-locations is one thing, but scaling there is a different ball game.
When scaling a dropshippingFacebook campaign, you will feel at some point that despite all your optimizations, your cost per purchase is now more than what you can afford to pay to run your ads profitably.
Most people at this point believe that the product has saturated. That the product has already been sold, profitably, to most potential buyers and reaching out more potential buyers will not happen profitably.
I believe that more than product saturation, the cause of higher CPP and decline in sales is ad fatigue. Hence, my first course of action in this situation is to create and try more creatives.
Before the buyer has received the product, the product is only as good as it’s creative. Hence changing creative can reduce some of the ad fatigue and may revive the life of your product. It’s not often product saturation, it’s the creative saturation.
Once the scale down stops working too, and you’re sure it’s time to kill your dying product, you can consider moving to manual bids with accelerated delivery.
You can set the maximum amount you’re willing to pay per purchase. If Facebook is unable to get you a sale under that price, no budget will be spent. By enabling accelerated delivery, you’re asking Facebook to spend your budget ASAP as long as it can do so by maintaining the manual bid. This ensures that as soon as there are cheap bids available in the auction, you want to spend all your budget to get them.
If you’re unable to spend any budget at all on manual bids either, you might consider killing your dying product.
I’m interested to know if there are other, smarter ways to delay the death of a dying product. Please let me know in the comments.
This is the second post of the three-part series that I’m publishing on dropshipping to help create awareness of what it is, and scaling strategies that we use in our company to rocket-fuel growth. This post is not for beginners and will make more sense if you have already started your dropshipping business or have some sort of digital marketing experience.
Since 2016, our company has been running several dropshipping stores in 3 different niches. Most of the growth comes from paid-advertising with majority budget spent on Facebook, Instagram and influencer marketing (also on FB & IG). We also spend about 20% of our ad budget on Pinterest and Google Ads. There is no reason why we spend less on the latter, we’re just more comfortable advertising on Facebook. It’s possible other dropshippers find more success on Google. So by all means I recommend that you explore it. Below I’ll list the top strategies we use in our company for growth.
#1 Product Hunting
I can’t stress enough the importance of product in your dropshipping business. Without a good product and creative, your chances of winning would seriously suffer no matter how good your ads are. I recommend that you spy other stores, AliExpress, Wish, Amazon and everything else that you can to get access to products before others. Most dropshippers use some kind of product spy tool which is often a paid subscription service. You can also search for products on social media platforms where they are being advertised.
#2 Influencer Marketing
Influencer marketing is often always an easier method to find success with dropshipping. To some people it looks more complicated because it involves reaching out to many people, testing their audience and sometimes losing money to less-engaging audience. You may also end up finding accounts with large amount of bot followers, causing total capital loss for the campaign.
The reason why I say it is the easier option is because once you make connection with the right influencers, this is basically an on-going, long-term money making opportunity. You can keep trying new products in the same niche with the same influencer and you can continue to get sales.
Influencer marketing is often also lesser competitive compared to the platform ads where everyone is competing, whether in a dropshipping business or not. This also means that once you have right influencers, you’re likely to have a much higher profit margin compared to running ads on any platform.
#3 Pixel Training & PPE Ads
Without pixels installed on your store from Facebook, Google (and any other platform you choose to advertise on), you’re never going to be able to run successful ads. In short, pixel is a small snippet of code provided by ad platforms that you can install on your stores. Once installed, the pixel establishes a connection between the store and the platform. For example, FB pixel will exchange data between the actions committed on your store and FB ad platform.
The pixel fires whenever a user initiates any action on your store whether it is view content, add to cart, initiate checkout or purchase etc. All user behavior and action data is stored in your pixel. As long as the pixel keeps getting fired, it continues to create an audience profile for you. The more sales you have, the more easily the pixel can help you find better audience. Without pixel training, your campaign is unlikely to do well for you.
First strategy that we commonly use to train pixel is running influencer marketing campaign to get quick, cheap sales. These sales help pixel understand our audience.
The second strategy that we use is running PPE (Page Post Engagement or simply Engagement ads). Engagement ads are cheaper than conversion ads. You get quick social proof, you get quicker, cheaper clicks and this can be a nice way to train and prepare your pixel for your actual campaign.
#4 Horizontal Scaling
After generating a few sales from influencer marketing and PPE ads, we start running website conversion ads. We create a large number of ad sets with a unique targeting angle for each ad set.We generally run these ad-sets on a small budget. This allows us to scale our campaign through many targeting angles. We also end up testing many targeting options. Setting a small budget for each ad set means you’re not trying to win all bids and so you don’t over-spend. Instead you scale horizontally, running many $20-$50 ad-sets. This way you can continue to lose bids (save money) as well as spend more budget (scale) your ad campaign.
#5 Vertical Scaling (with Manual Bids)
Once we have found our top winning ad-sets we also want to scale them vertically. What that means is we ideally want to increase budget for these ad sets. There are generally 2 methods of how this can be done.
Using the first method, you can increase budget for winning ad sets by 10-20% every 2-3 days. This is obviously a slow process and can sometimes not work as expected because ad-sets try to re-optimize every-time they are updated.
The second method is scaling through manual bids. This means that the budget can be exponentially and immediately increased. But we put a cap on what we’re willing to pay for each sale. If the ad-set fails to get a sale, it stops spending. We have had success running $5000/day ad-sets using this method. So this is a fool-proof method to scale vertically. You win, or you don’t spend.
#6 Lookalike Ads
Lookalike is a magical AI technology by Facebook which allows you to run ads without any targeting options. Once you have generated more than 100 sales from a single country, you are eligible to create lookalike audience. This is the quickest, dumbest, simplest way of scaling your ads by letting Facebook do your job.
The simplest explanation of retargeting is not leaving money on the table. A lot of clicks to your website are going to result in missed sales, abandoned carts or simply window shopping. You can reach these high-intent buyers again. Just run retargeting ads, emails & SMS to convert these missed leads for almost negligible price.
A lot of this information is going to sound tough especially if you’re a first time advertiser. But who said running a 7-figure business was going to be easy. The good news is, you can simply start with influencer marketing and learn your way up. The better news is, this is a very low cost business to begin with. You can start with as little as $2000 and make your way up to 7-figure. And the best news is, we have seen it happen first-hand.