EPISODE 29 OF THE MARKETING SOLUTIONS PODCAST: Why do Google and Facebook ads work for some businesses but not others? (Even if they are in the same industry)
Sonya McIntyre-Reid:
Today. I am here with a work friend Ash. And I actually met Ash through my work husband. And Ash is incredible at all things paid-per-click advertising. And I'm so lucky he's decided to come on the show today. Welcome Ash.
Ash:
Thanks Sonya. Thanks for having me. Very excited to be here.
Sonya McIntyre-Reid:
Excellent. So you are currently living agency life, hashtag. Can you talk to me about how much you currently manage in advertising budget across all of your clients or a ballpark figure?
Ash:
Yeah. In terms of ad spend on a monthly basis we're managing hundreds of thousands of dollars worth of ad spend. And throughout an entire year with individual campaigns coming and going as well, you look at potentially tens of millions of dollars in ad spend that we're managing on a year-to-year basis. So it is a lot of money, and it is a lot of responsibility sometimes, especially with the bigger campaigns. So yeah, it's interesting. And obviously sometimes the smaller campaigns are just as intense as the bigger ones too.
Sonya McIntyre-Reid:
Absolutely. And I think that's something that people have got to remember as well when it comes to digital advertising. Essentially, if you are running a small campaign in terms of budget, it doesn't mean there's necessarily less work involved as well. Sometimes it's more work, because you've got to make that ad spend work harder to get an appropriate return to the client.
Ash:
Yeah, exactly. And with the big spends, you're right. It is easy to get a lot of people. And when you do that, you bounce a hit. It's like the shotgun approach versus the sniper rifle. So you've got to be a lot more accurate when you're dealing with a small campaign. You've just got to make sure you're not wasting any of that spend.
Sonya McIntyre-Reid:
So when you're talking about a small campaign, what would you classify a small budget is for Facebook and Google ads? I know that's like how long is a piece of string, but if we had to break it up into a category, anything less than how much a month would you consider small?
Ash:
Yeah. Good question. Look, in terms of a small budget you probably looking at... and it could depend platform to platform. I think some platforms obviously have a lot bigger reach. Therefore when you're looking at budgets, a small budget is not necessarily small, it just depends who you want to be reaching. And if you can reach them with a small budget and you have a small audience, that makes sense. But in terms of small, I say anything less than around 1000 probably is considered a small budget. I would say anything over 1000, you start to get a little bit more to play with. And that just gives you a little bit more flexibility in what you can do, and the different types of campaigns. And probably we might talk about this later, but just that awareness, and that nature, and then the convert stage. But with a small budget, people tend to just want to focus on that conversion stage. And that pretty much will take up most of that budget if you're under 1000.
Sonya McIntyre-Reid:
Yeah, absolutely. So when Ash is saying that conversion stage, and I know I probably need to do a podcast episode explaining this small, but when we're looking at a sales funnel, we're looking at the bottom of the funnel. So people that are already aware of the brand, really focusing on that retargeting and getting people across the line to purchase it, if have probably already been to your website rather than reaching a new audience, warming them up and pushing them down. That funnel.
Sonya McIntyre-Reid:
Question for you. So obviously I think I've spoken to you about this previously, but... And I know I see my agency all the time. But you can run one campaign for one client and then run another campaign that's very similar for a client in the same industry, similar products, whatever it might be, one work amazingly for one client, but then not another. Why do you think this is? Why do you think digital advertising works for some businesses, but not for others?
Ash:
I think if we're talking about the same campaign in the same industry, and I've seen both as well. And in terms of some you can just take and replicate. And they do perform just as well, and then others don't. And in my experience, the ones that don't perform, it really comes down to the business itself. And you can have businesses in the same industry, but one might have been the industry for 20 years, one might've been in there for five years, one might be a brand new player in the industry. So it really depends. And that's where if you have all of those people with that same strategy, and they're all competing for that bottom of the funnel, the chances are that 50% of the people are really going to go with that really trusted brand, and the new brand is going to find it tougher in terms of that same campaign to get the same results.
Ash:
And that's why it's important if you are a new player in an industry, and you really need to look at all stages of the funnel. And you can't really just think trying to jump in with the big boys at the bottom of the funnel. Because you're really not going to get bang for your buck, especially long term, you're not going to get that return on investment. So I'd say it just depends on the business, your unique selling point. And if you have one that can really separate you, that usually will be the difference. But it really depends as well on the trust factor and how long you've been in that industry as well.
Sonya McIntyre-Reid:
Yeah, definitely. So I think something that I come across all the time is that there's a lot of agencies out there that bang on about, "Put $1 in and get $3 out." If you're a new business, there's a lot of activities and we know who I'm talking about, there's a lot of that talk happening. But if you're a new business, you really need to be looking at that brand awareness and building up that brand equity as well. And often that's something that's actually really hard to track and quantify. But it's just as important as focusing on that conversion side of things as well. So what is your theory around warming people up before you go in for that hard sell?
Ash:
I think the way I look at it is from the start to the finish. And if you look at it from your own life and your own perspective of how you buy products, generally there's going to be a point in your life where you're going to want to buy a fridge. And if you own a home, you probably want to buy a fridge, just as an example. But you're not always going to be in that mode, or in that phase of the actual buying process. There's going to be times when you're not thinking about buying a fridge, but you're going to at some point. And that's where it's really important to, as a business, be targeting those people who you know will be purchasing a product at some point, but they're just not ready to buy it at this point. So that's the first stage.
Ash:
But if you can do that at that stage, when they do get into that, "Okay, now I'm starting to look for a fridge," I already have your brand at the forefront. So that already cuts through about 50%. And there're studies around exactly what that top of mind can reflect into when people especially going to PPC and go to search. So having a brand at top of mind when people are searching as well. So you might have people looking for a particular type of fridge, but then they also type in your brand as well. So you can really cut out a lot of your competitors who were trying to compete and take clicks away from you, competition ads, competitor ads, and stuff like this.
Ash:
So it's really important and it is harder to attribute. And that's one of the pain points, especially in the industry right now, is that people are finding it hard to see those ROI figures, save that one for $3, like you were saying in ad spend that they're getting back from these awareness campaigns. But they are just as important as they've ever been in terms of that buying process, especially with the amount of noise in every industry at the moment, especially with online stores popping up left, right and center. There's so much competition out there. So by getting a brand in the mind of your consumer early on, you're saving yourself a lot of dollars down the track when it does come to them converting.
Sonya McIntyre-Reid:
Absolutely. And I think that's something that all agencies really struggle with. If you're starting with a client that is relatively new in the space, actually competing against the big guys and the established businesses is really hard. Because they've already won that brand equity. They've built up that brand awareness. So what are some techniques that you can use to help with this? And how does this differ between say Google and Facebook ads?
Ash:
Yeah. Great question. So in terms of combating that brand dominance that some industries have, and look there might be a few different players, there usually is. But they all have different selling points. And I find the best way to combat this is, really don't be worrying about too much about the big guys in terms of when you're starting to do your brand awareness campaigns. Don't worry about what they're doing so much. Really focus on why you're different. And once you to know why you're different and what your unique selling points are as a business, and whether that's personalized custom, whether it's free shipping, whether it's all these different kinds of things that you can offer that perhaps you can to a specific part of that audience, that's what you really need to focus on.
Ash:
And I think when you're looking at Google and Facebook, it's really using those audience targeting tools to segment your audience down further and not just putting out a general audience, which all the other guys are doing. But they have a lot more budget than you. And they're always going to beat you out if you try and do that. So it's really about segmenting, slicing, and dicing your audience. So you really get it down to that niche that you know is really going to be responsive to that unique selling point that you have. So finding that and matching that up is always the best place to start. And once you've done that and you start getting returns from that particular audience, then you can start looking at other ways that you can build up the other segments within your target market.
Ash:
But usually it's looking at yourself and not necessarily looking at the competitors and trying to match what they're doing, especially the bigger players. Because unless you've got the budget to match it, you're going to be starting well behind.
Sonya McIntyre-Reid:
Absolutely right. Okay. I'm going to switch gears a little bit now. So Ash's been working to just advise me on a client campaign recently. I'm not the smartest person in the room when it comes to eCommerce ads, but I'm always so hungry to learn and do the best for our clients. I bring in people like Ash or call him up and be like, "Hey, this is what I'm doing. What should I do next," quite often. And I think this applies to all areas of your marketing. Because when you are so close to something and you analyze and you looking at it so much, sometimes you just can't see things clearly. So I think it's always good to have someone come in and advise you and you need it.
Sonya McIntyre-Reid:
So we've been working with a client recently, or I have, and Ash has been giving me a little bit of advice here and there. We've been going for about three months now. And just got an email from the client this morning actually, being like, "You need to switch the ads off, because we are totally out of stock." Ash, can you walk me through how we have worked with this client from them sort of dabbling with Facebook ads, to how the campaign has been set up, and I'm talking nitty gritty around top of funnel, middle of funnel, bottom of funnel, and how it's scaled from there?
Ash:
Yeah, definitely. And that's good to hear that they've run out of stock. That's a really good problem to have. I would say from that particular campaign, and what we've talked about is that it really was proving to them when they were first starting, they were really just playing, wants to get at that bottom of that funnel. And especially just through Facebook as well, and looking to drive as many people through retargeting, and through a little bit of other prospecting audiences, and things like that. But they weren't getting any lower cost per conversion. They weren't really making a lot of margin on what they were doing with those particular ads.
Ash:
So basically what we said was to really look higher up the funnel, really look at engaging, breaking through a little bit in terms of the market with some video content, product-specific pieces of content that we could really educate the market, and then within the next week of them seeing and engaging with that content, we would follow them up with then a conversion ad or product specific ad where they could find out more details, and then go on to purchase the product from the site.
Ash:
So once again, it was really hard to initially get them to see the value in the engagement audiences and really see the value in putting out and spending ad dollars on getting people to watch videos, and see these educational pieces. But then once they realized that that strategy was actually helping them reduce their cost per conversion, and their cost per sale at the end of the day. And from what you've told me, they actually managed to reduce it in the first... From month one to month three, they slashed it. They were down to like a quarter of what they were paying originally per sale.
Ash:
And that's just really making an audience engaged and then trying to sell to them, which on Facebook it's actually a great. And social media in general is a great way to do that, because you can address all three stages of the buying cycle in the funnel, because you can really look at awareness, you can create awareness, you can then nurture the people who've engaged with those awareness posts that you've originally put out. And then if the people who have engaged you then hit them up with a conversion ad. So it's really a great tool to be able to take customers from start to finish, nurture them, and take them through that journey.
Ash:
And that's something you can't necessarily do as well on, on Google. And Google is more of that pool marketing strategy where everyone is searching. So I think for them specifically that Facebook approach and hitting at all those different stages of the funnel, has really allowed them to really reduce that cost per sale. And while they can't directly see the attribution, they can now see the cost per sale going down. And they know that's a direct correlation between the engagement audiences that we were doing. So I think we've got a big success.
Sonya McIntyre-Reid:
I think that's fantastic. And as Ash just said before, actually had the client pushed back on me last month and be like, "I had a look into the backend of Facebook. I'm seeing we're not getting any sales or very minimal sales from these awareness ads." And that is something that I really need to stress. That when you see agencies screenshot one line out of the Facebook ads manager, and it says "Return on ad spend, or ROAS R-O-A-S," that is them saying," Oh, look. We've got a huge ROAS," for example, or cost per sale is another metric in there as well. Cost per conversion. Sorry. What they're not showing, cost per purchase. Is that what it is? Because I'm all muddled.
Ash:
Okay. Purchase. Yeah. Your variation.
Sonya McIntyre-Reid:
Yeah. Anyway, it's basically saying that you spent this much and you've got this much back essentially, or you spent this much to get a sale. Different versions in there. But what they're not showing you is the amount that they've spent in that warming up process with the audience. So just something to be aware of, if you are looking at running Facebook ads within an agency, and you're getting convinced by these, these one-line screenshots. But this client pushed back and said, "Why are we running these ads, but not getting sales from them?" And I do have to stress again, I sound like a broken record, but it is not enough just to run a conversion ad campaign and put an ad out there and get sales. Marketing doesn't work like that. Despite what these other big agencies are saying to you about, "Oh, we put $1 in and get $3 back." It doesn't necessarily work that way. We can get down to that point with Facebook ads, absolutely where we know exactly how much we've spent and the return. But it's not a clean, straight line like that.
Sonya McIntyre-Reid:
Question for you. Something that I have often come up against, that we get to a point where our campaign is converting on Facebook beautifully. And we're like, "Great." We're getting a really solid return on ad spend here. How do you go about effectively scaling? Do you just duplicate the ads? Do you just add more budget to each step of the funnel? How do you... Like what do you do?
Ash:
That's a great question. And that's the question that I think a lot of people, and a lot of business owners want to know the answer to. And we get a lot coming to RNC as well, and they're looking to scale up and they said, "We're ready to take things to the next level. How do we do that?" And a lot of the time we have to say that, "Look, we need to actually make sure we're addressing all stages of the funnel first." And sometimes it's a matter of rebuilding that. But in order to scale up, like I said, it's a matter of really looking at your audience. And I can't stress enough when you do go to an agency or you employ someone to do some marketing for you, make sure that they know as much about your audience and if not more than you do. Because really that's what's going to allow them to make that campaign perform at its best.
Ash:
Because if anyone's saying they'll do digital marketing for you, and run Facebook ads, or run Google ads, and they don't know anything about your audience and they just say, "I'll take it from here," you're really in trouble at that point. Because they just don't know one, who your audience is, two, what message they need to send to that audience. And where they are, where their touch points are. So these are all really important things. And when we're talking about scaling up, it's really important to understand how big your audience is as a starting point, and how big your audience can be.
Ash:
So it's initially in that first campaign, you're targeting an audience that's, let's say 90000 people in Melbourne who are moms, let's say, and you know that there's, you can reach in your current campaign with the spam that you have around 30000 of those. That's where I would turn around and say, "Hey, look. There's 60000 other moms here that we haven't been able to reach out. There's an opportunity to scale up." And that's where it would be a matter of just increasing the amount of budget at that awareness stage to reach those people. And then from there, it will filter down. And you would have slowly scaled budgets up on your engagement, and then in your conversion, as you get more and more people into each of those buckets.
Sonya McIntyre-Reid:
Great. So focusing first and foremost, so it's a three-step process first and foremost, focusing on getting more people on the top of the funnel. So pouring more water into that funnel, and then increasing the budget there, and then as those people are being moved down, then increasing the budget and the consequence stages as well.
Ash:
Yeah.
Sonya McIntyre-Reid:
So it's perfect.
Ash:
Exactly. And if you have another 60000 people, you can scale up too. And it's about knowing the audience. And your range, they should be able to give you this information about how big your audience size is. And it's something you should be aware of. Because then if you pull that, it's another 60000, and you can reach them into that top of the bucket. You might get another 10000 that engage with their posts. So that 10000 and engaged, they go into the next bucket. And you might get another 500 people that then go on to purchase out of that. So it is a flow on waterfall effect, if you want to look at it like that.
Sonya McIntyre-Reid:
Yeah. Great. Do you have a rule of thumb for a minimum amount per ad set in Facebook? Like a minimum budget that you would start with per ad set? Because I've heard so many mixed things. Like I've had people say to me, "Oh, we're looking at $10 per ad set per day. And then I go in and look at our campaigns that have been converting, and I'm like, "Well, in some places with spending like $2.50 per day for a particular ad set." So what is your thought around that, especially when you're just getting started?
Ash:
Yeah. And it is really important when you're getting started. Because once you start having the data flowing through the campaign, you can really start allocating the budget to where it needs to be. So in terms of having a spend per ad set, I wouldn't recommend just having anything set in concrete. But when you do start a campaign, it's really important to make sure you have enough budget across your ad sets, to be able to reach the amount of people that you need to reach. Because if you spread your budget too thin, it's going to take you maybe two months to get the data. It would take you to get the same data in a week if you had $10 versus $2 on those ad sets.
Ash:
So it's really about how quickly you want to get that data back from how many people you're reaching, are the impressions, the clicks. And obviously Facebook as well actually limits you in terms of how low you can go. I think it's about depending on how many ad sets you have. It's around about $1.50 or $2 minimum per ad set. In certain cases, if you get too many ad sets, they just say, "No, you have that minimum spend.' And that's just purely because it will take you far too long to get any meaningful data. And the impressions will be so low. So when you're starting out, it's just good to have an even spread, I agree. In terms of an actual number you put on that, it just depends once again, on your audience. How big is your audience? If your audience is only 150 people, you're not going to have to put much. But if your audience is 10000 people, you're going to have to put a little bit more. So it's really just understanding your audience.
Ash:
And it does come back to that point. There's no one-size-fits-all. If it was, a lot more people would be having great success. But it's really understanding your audience, and knowing how big they are, and how many people of those audience you want to reach. And that's always the best starting point whenever I start a campaign. So no concrete answer for that one. But I would say you want to make sure you have enough to get the data that you need to then start making real decisions about what's working or what's not. And if you want to do that in the short term, put more budget. If you want to take a bit longer, be conservative, put a little bit less. But it's really just knowing how big your audience is. And how much you need to reach them.
Sonya McIntyre-Reid:
Absolutely. And I think be wary of anyone that says to you, "Here's the hard and fast rule," when it comes to digital advertising. Even I've had clients say to me, "Well, what kind of return can I expect on this money?" And I was like, "Well, what's your audience like? What's your sell? What are the competitors doing as well?" Because Facebook and Google ads work in an auction system. You're essentially paying to reach people that if your competitors are trying to write to them as well, then you're fighting it out with your ad spend. So something to keep in mind.
Sonya McIntyre-Reid:
Alright. So obviously you manage so much in ad spend each year. And it allows you the opportunity to test, and tweak, and work out what's working in real time. Right. But are there any courses you've done it that were really valuable? Is there anyone you follow in the industry podcasts? Where are you staying up to date with your knowledge and getting ideas from?
Ash:
Yeah, I think that's a great question. And I think it would be a different answer for a lot of people. And whether you work in an agency, whether you freelance, whether you work internally in a company, I think there's an agency. One of the big benefits are that you're constantly working with people who are directly in industry, they've got their finger on the pulse. They're working across multiple different campaigns and industries every single day. So for me, it's I get a lot of my learnings and my information from what I currently work on, on the day to day, and what I'm finding from that.
Ash:
But in terms of who I follow and where I get information and trends, I will occasionally be looking at some of the leading resources in the industry, and whether it's social. And you're looking at, AdEspresso is obviously a good place to look for, if you're looking for updates and what Facebook's been doing recently. I know that they do a good job with their blogs in terms of keeping people current, up to date. Things like Search Engine Land is really great for Google stuff and keeping up to date there. And some of these things, you don't see them in the day to day and they, and they do appear in the background or you won't feel the effects till a few weeks later, especially with Google of what that actually means. So it's good to stay on top of those, just from a trend point of view.
Ash:
But just in terms of working on accounts, and getting your hands on the tools every single day, you do just pick up those things pretty quickly in terms of what the direction of the industry is. What's working, what's not working. So I think that's just the benefit of working in an agency too. You're just constantly working with people who are wanting to learn and learning at a rapid rate in an industry that's changing very quickly. So for those who are doing the freelancing are working internally and don't necessarily have that community to bounce off, I would recommend going through those resources. But also look at joining some communities as well. There's plenty of social groups out there that support digital marketing, and there's some really clever people out there that are constantly putting out some really great resources, which can turn campaigns around really quickly. The results are there. It's just a matter of going and finding them.
Sonya McIntyre-Reid:
Cool. So any names of people that you follow podcasts? Give me some good-
Ash:
To be honest, I'm not a big podcaster.
Sonya McIntyre-Reid:
Not a podcaster. Alright. So you're in the Facebook groups. Which groups are really valuable that you've found?
Ash:
Off the top of my head. I actually won't be able to give it any off the top of my head. But I'm pretty terrible at this. But I know that there are quite a few.
Sonya McIntyre-Reid:
That's cool. I will get you send to us through a list and we'll pop them in the show notes. Because I know how valuable Facebook groups can be. I know what you're talking about when people... You join these communities, you're having issues with a campaign. You can put it in there, talk to people about it. And that's what Ash is for me. Having people that you can bounce campaign ideas off and troubleshoot, is really, really important. Because again, you can get so close to something that you're just like, "I don't know what's going on here. What am I missing?" So I think that's a good thing to do. Any myths that you want to bust Ash? Is there something that really grinds your gears in our industry?
Ash:
Myth busting. Let me think. Look, I think it does come back to that. There are no hard and fast rules. I think when you brought that up, that was really hitting out with me. And I think there are a lot of agencies out there and a lot of people out there who are trying to sell digital marketing in that way. And it's just really not a great long-term solution for a lot of businesses. So when you do hear that we can get return for you, and they're guaranteeing these kinds of things, it's really just a bit of a warning sign. And like you're saying, it really depends. Because if you've got a new website that you don't know how well it converts or historically it doesn't convert that well, or it converts great, and then you've got agencies telling you that they're going to get an X amount of return without knowing how you convert, that's one of the main things that is a bit of a myth to me. And I don't know why people aren't questioning that more often. Because you can't really promise return without knowing all the facts. So if there aren't all the facts about your business, they can't really make that call. And if they're trying to make that call without knowing that, that's something you should be really questioning, if you're thinking about doing digital marketing, for sure.
Sonya McIntyre-Reid:
Absolutely. And I would feel the same. I would never ever even having all the facts. Because you can never know everything about a business before you've even started working with them. I would never guarantee results. I've had people that I've pitched say to me, "Well, what can you guarantee? What are we going to get from this?" And it's not that we're not incredibly skilled at what we do. It's just, it's completely unethical to guarantee results in the digital marketing industry. Because there are so many factors at play. So something to keep in mind, if someone is saying to you, "I can guarantee X, Y, Z," go and have a look at the fine print.
Sonya McIntyre-Reid:
And this is something that I'm going to be touching on in terms of SCRE in a future episode. But I have known agencies to do this, say, "We're going to rank you for 90% of your top 10 keywords," or whatever, but then they'll throw in a bunch of bonus keywords and rank you for those, which are easier to tick off that box in the contract. So just being aware and questioning, I think is a really, really good thing, if you are going to work with an agency moving forward.
Ash:
Yeah. And look, you might not have all the facts, and it might be intimidating to ask an agency who has a lot of experience. And when they're telling you that they can get you this return to ask these questions. But I think it's just, it is really important to say, "What are you basing this on?" If that's the only question that you ask, I think that's a really good one. Because you really need to know what are they basing these results they're going to get you on. Because a lot of the time, it's not necessarily based on your specific situation. It's based on something they might have done for another client. And like we said before, they might've been one of the bigger players in the industry. And of course the campaign was going to work well for them, but not necessarily your specific situation. So definitely yes.
Sonya McIntyre-Reid:
Isn't that funny with agencies? Like it's easier to get results for big clients than it is to small clients, essentially. Which is a bit of an irony, I think in terms of, if you're working with small clients, I often feel like sometimes you're working 10 times as hard to get results.
Ash:
Yes. Absolutely. And that [crosstalk 00:29:42]. That's very true. But sometimes once you take a small client from, from a small client to a medium to big client, can be even more of to get as well for us.
Sonya McIntyre-Reid:
Absolutely. It's a challenge. We love a challenge.
Ash:
Yeah, we do.
Sonya McIntyre-Reid:
Alright, Ash. Thank you so much for taking time to come on to the podcast. Do you have like an Instagram or anything that people can follow your journey on? Are you sharing any content online at the moment, or are you keeping pretty quiet in the background?
Ash:
I'm sure a little bit LinkedIn. That's about it. So you can add me on LinkedIn. I'll send that to you as well, and you can-
Sonya McIntyre-Reid:
Perfect. I'll pop that in the show notes. Excellent. Thanks again, Ash.
Ash:
Thanks Sonya. Pleasure.