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How We Grew A Marketing Subscription/SaaS Business To $160,000/mo…

In this post, I’m going to outline the exact strategy that we used to take IGWildfire from about 100 paying monthly users, to more than 3000 paying monthly users using paid acquisition on Facebook & Instagram.

This campaign lasted for about 6 months and brought in about $1,000,000 in revenue with less than $100,000 in ad spend.

For the 6-7 months that this campaign lasted for, we were generating about 500 new subscriptions (paying users) a month.

Monthly recurring revenue was going up by $20k-$25k in MRR consistently each month.

The customer lifetime value for the product was around $350 ($25 for the first month +$50/100 month after that) and the cost per new user acquisition was under $30.

The product was a monthly Instagram growth service. (Example: graminator, simplygram). The overhead was pretty low as the client relied mostly on bots (as the other similar services do); this product can be categorized both as SaaS and a service, depending on how you look at it.

After 6-7 months of advertising, Facebook cracked down on Instagram growth services(mostly bots), and a lot of accounts got shut down, including our clients. The client also started experiencing problems with delivering the service due to Instagram’s crackdown on bots, the business is now defunct. (You can see the website in Wayback machine, igwildfire.com)

Before the campaign, although the client had a product/service that the market wanted, the exposure that he was getting organically was too slow and limited for any significant growth so he reached out to us (infoscaling.com) for help.

He tried to play with paid ads on FB & IG, but he couldn’t make them work within a target cost per acquisition.

The cost per acquisition goal that he had was $30 – which would allow him to almost break even on ad spend in the first month. In reality, he ended up paying up to $90-$100 to acquire a new customer — which meant it took him 3 months to just break even on his advertising costs.

Since it took him three months to break even on initial advertising costs, he couldn’t really grow his user base with paid advertising.

As opposed to organic, if you can make paid advertising work you can have:

1) HIGH-LEVEL CONTROL — With paid advertising, you have absolute control over the acquisition process. When you need more customers, you switch the ON button. When you decide that you have enough customers (if that scenario is possible :D), you simply switch your campaigns off. You’re able to control the level of spend and the speed at which you scale.

Of course, it’s more complicated than that, but it’s generally how it works.

2) ABILITY TO SCALE FAST — Instagram and Facebook are without a doubt the fastest channels for scale once when you figure out what works for your business. Compared to other ‘intent-based’ advertising platforms like Google Adwords, where your ad reach is limited by a number of searches for a specific keyword, on Facebook & Instagram, you can reach an unlimited (virtually) number of potential buyers daily. Unlike SEO and content marketing which takes a lot of time, the only thing that limits the speed of scale with paid acquisition is your ability to spend money.

3) LOW PEOPLE OVERHEAD — Unlike organic marketing methods, operations in paid advertising can be executed highly successfully with a small team of three or two media buyers that can manage hundreds of thousands of dollars per month in ad spend.

If you align the key elements of your marketing campaign and hit the sweet spot, you can grow the user base really fast&really profitably. (Facebook & Instagram have virtually unlimited high-quality traffic)

After a few weeks of adjusting IGWildfire’s funnel and testing new campaigns, we built a campaign that was able to acquire new customers at $25.08 per sale. (Which meant break-even in the first month and profit after that)

We generated the first 400 users and grew the MRR from $5,000 to $25,000 within the first 30 days.

In the end, the campaign generated more than $1,000,000.00 in lifetime revenue from only $92,707 in ad spend.

This is the step by step process that we used to scale IGWildfire from 100 users to 3200+ paying users in just 6 months.

Let’s dive in…

1) Clearly Define The Main Target Avatar And Best Segments Of The Market

One of the most important steps that define chances of success in paid advertising is defining who you’re speaking to (and who you’re going to target) in your creatives.

From analyzing his customer’s current user base, we found that the top-paying customers were fashion and beauty influencers (and wannabe influencers) and adjusted the copy&creatives to speak to them. We also adjusted the targeting accordingly (you’ll see it in #7).

Targeting the audience (both with actual ad targeting and adjusting the creative) that is most likely to pay the most has an effect on LTV and subsequently ROAS (return on ad spend).

2) Find the best converting offer/free trial model (Crucial)

Although this business was founded back in 2015, it took almost 3 years to get it to actually produce any substantial revenue. One of the major reasons why it took that long was having an offer that the market didn’t respond to.

The initial offer (free trial) was 25 free followers. The conversion rate (from visitor to claim offer) was high – but the conversion to paying customers from that offer was terrible.

We first needed to find an offer that was actually converting to paid users at a high enough rate.

We first switched to 2-day Free Trial . However, using an Instagram growth service for just 2 days was too little time for the vast majority of users to see any growth of their accounts so they didn’t see any value in keeping the service.

Next, we tried with a 50% OFF for the first month – with a promise to get 250 targeted followers and reach 15,000 Instagram accounts. The visitor to conversion rate was much lower than in the first 2 cases, but people who bought kept paying. This was exactly what we needed.

3) Invest In Ad Creatives Production

Three years ago, you could use stock photos on Facebook and your ads would still work. This is no longer the case. You have to invest time and money in quality creatives (especially video) if you want your ads to work.

Here are the main types of ads that we test when we start working on a new project:

a) Animated videos — they’re expensive but work really well for a lot of products (eg. SaaS). We tested a few of those but the results were not satisfying in this case.

b) Videos recorded by a client or his audience  – testimonials/presenting the product. These are easy and fast to create and work really well in a lot of industries.

c) Image ads – there’s an unlimited number of variations that you can try here (the more your budget allows you, the better. Split-testing is key)

We instructed the client to get 20 different testimonial videos from his customers and created 15 animated videos for testing.

The top-performing ad was a simple testimonial video recorded in a car. The testimonial was from a fashion influencer with a big following (implying that they can too get a big following) so it perfectly hit the target avatar, built trust and presented the offer.

Here’s the screenshot from the video:

4) Analyze data & Adjust accordingly

After the first 30 days of the campaign, we generated around 400 new paying users.

We found that Instagram Ads generated 95% of total sales in the first month. Although the CPA was slightly higher than on Facebook, we couldn’t have enough traffic volume on Facebook in order to scale like we wanted to.

Also, most of the buyers were women between 25–45 years old ( that also influenced our decision on what testimonials to use in ads).

You need to constantly be monitoring the data and adjust your campaigns accordingly & make decisions based on the data.

5) Optimize Ad Creatives

After testing the initial creatives and finding the best ones, you need to optimize those further (with the goal of reducing the CPA).

The hypothesis was, if we took the best performing video ad and add subtitles and the right text on the top of the video (classic Gary V style) — we’ll increase our CTRs, decrease CPCs, and ultimately reduce our CPA which started going up a bit.

We came up with 10 different headlines for the video and tested them all. Few of them worked really good.

We continued testing different variations throughout the campaign, both to decrease the CPA and have fresh creatives to counter banner blindness.

Here are some of the different headlines we used:

6) Utilize conversion events, custom conversions, and the pixel

Setting up the Facebook pixel properly on the campaign start is crucial to every campaign’s success.

The funnel looked like this:
Ad -> Sales Page -> Checkout Page 1 -> Thank You Page 1
Ad -> Sales page -> Checkout Page 2 -> Thank You Page 2

In order to be able to segment the audiences for retargeting and to track the success of the ad, we set up the basic FB pixel (page view) on all pages, and set up the purchase pixel on the thank you page to track purchases.

All the campaigns on the account were optimized by using conversion events and custom conversions. Generally the event you want to optimize for is the event you want (eg. Purchase/Lead/Click).

The more data your pixel gathers, the better it can optimize in the future, which helps with long term campaign success.

7) Scale with lookalike audiences

From a technical perspective, scaling your winning campaigns mostly depends on finding new audiences you can show your ads to.

When we start working on a new account, the first step that we take is creating custom audiences of people depending on what stage of the funnel they’re in (or visited;tracked by FB pixel). The more custom audiences you create — the more relevant you can be to different audience segments within a funnel(by showing different types of content/offers depending on what stage in the funnel they’re in).

From custom audiences, then, we create lookalike audiences. The best lookalike audience you can have is buyers (purchases) lookalike.

Here’s some of the lookalikes we’ve used in this campaign.

  • Purchases (7 days) -> Lookalike 1%, Lookalike 2%, Lookalike 5%, Lookalike 10%
  • Purchases (30 Days) -> Lookalike 1%, Lookalike 2%, Lookalike 5%, Lookalike 10%
  • Purchases (90 Days) -> Lookalike 1%, Lookalike 2%, Lookalike 5%, Lookalike 10%
  • Purchases (180 Days) -> Lookalike 1%, Lookalike 2%, Lookalike 5%, Lookalike 10%

As you can see, just by having ONE custom audience broken down into smaller audiences based on a specific time frame (7–180 days) — you’re able to create 20–30 different lookalike audiences for the scaling stage.

Also, since we knew from the data that the best-paying customers were fashion influencers, we extracted the emails from those buyers, created a custom and then lookalike audiences from that.

This was one of the best performing cold audiences.

Later on, when you have a few thousands of actions (ideally purchases) recorded on your pixel — you can throw out the targeting and let the FB pixel to do the heavy lifting for you. This works best when you’re scaling worldwide and have a potential market of 10–20MM customers.

8) Leverage Warm & Hot Retargeting Audiences (CPA Reduction)

I already mentioned how Instagram gave us a better CPA and volume than Facebook on cold traffic, but when it comes to retargeting, things were different.

In retargeting campaigns, we were getting better CPA on Facebook than Instagram (because we could retarget them on the desktop for very little $) and our retargeting ads were super relevant to them.

When we started scaling the overall CPA on cold traffic went up to $30-$35 per sale, so having a good approach in the RTG campaigns became necessary.

The results for retargeting were 575 sales total at $17.51. This significantly impacted the overall CPA and kept it where it needed to be.

We found that 2 out of 10 custom audiences we were using were most profitable & brought in the most sales so we focused on those. (Instagram page engagers (30 Days) and checkout abandoners (Last 7 Days & Last 15 Days))

9) Stay Compliant With FB TOS

And the last lesson from this campaign is… you should never build a business in a way that it’s totally dependent on other platforms. Although, having an extra $1,000,000 is not too shabby.

The entire business model was destined to be shut down sooner or later. We knew that one day Facebook / Instagram will crackdown on Instagram growth services – which happened in the end and the business was prohibited from advertising.

Want results like these? Schedule a free strategy session with us to find out how we can help you with your paid user acquisition.

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How We Generated 1MM+ In Revenue Selling Online Courses…

Behind the scenes of a Facebook ad campaign that generated over 4100 online course & membership sales.

Selling memberships and online courses in the information industry is getting harder and more competitive each year. 2020 won’t be different. 

The main reasons are: 

  • The cost of advertising is higher than it’s ever been
  • The market has become extremely saturated with so-called experts promising overnight results which negatively affect consumer trust.
  • There’s no real differentiation between offered products and services (no real USP)

If you were selling $47, $497, or $997 info-products or monthly memberships to the cold audience few years ago – you remember getting 2X, 3X or even 5X returns on day 1, without too much work. 

That’s when CPC on Facebook was $0.20 or $0.40. 

With average CPC approaching $2, that’s not the case anymore.

When you adapt and do things the right way (like it’s 2020) Facebook still works, big time. 

We know that because we are the guys behind Facebook & Instagram campaigns for some of the world’s leading fitness experts like Christmas Abbott, Barstazz, and Al Kavadlo.

The specific campaign for Christmas Abbott we managed brought in over $1,000,000+ in revenue in 12 months.

We generated 4154 sales for the course ($27-47) on the front end. With all the upsells and downsells, the AOV (average order value) was around $87 which amounted to about $360,000 in front end revenue. 

The average lifetime value of the membership ($20/month) was $160, which amounted to an additional $664,640 in revenue over the course of 12 months.  

But before you can replicate the paid traffic strategies and tactics – you need to understand the fundamentals.

I’m not going to pretend that our Facebook campaigns are the main reason our clients have achieved the results I’m talking about.

They have a solid business foundation in place, and an audience to sell to (although 70% of sales came from new audiences.)

Here’s what our most successful clients’ businesses have in common, and what you need to have in order to win in 2020:

Their #1 Goal From Paid Advertising Is To Breakeven On The Front End

Dan Kennedy  once said: “The business that can spend the most to acquire a customer wins.”

The goal has changed and your main goal with paid advertising, especially in the subscription business, should be to acquire as many customers/subscribers as possible early, and profit later. 

Businesses that are charging high prices and trying to profit from day 1 will be left behind. 

Optimizing your cost to acquire a customer (CPA) and increasing the customer lifetime value (CLV) is how you’re going to win. 

When this is dialed in you can spend the most to acquire a customer, and get the money invested in ad spend back – right away. 

How do we do that? By getting our cost per acquisition = average order value (AOV). (Or more, which was the case in this campaign).

Apart from that funnel, we used a lot of other funnels during testing, which accounted for the rest of the front end revenue.

They have one core funnel that enables them to acquire new customers at a breakeven

In order to get your CPA to match your AOV you need to do two things:

  1. Optimize your CPA by lowering your advertising cost, which I’m going to talk about later in the post.
  2. Increase your average order value by optimizing your customer acquisition/buying experience

To successfully execute #2, you need a working funnel in place. A funnel that’s able to convert customers at a high enough AOV. Increasing AOV is achieved through consistent testing of your upsells/ downsells.

All our most successful clients have a funnel that enables them (after optimizing the ads) to break even on traffic costs. 

They take care of their community and are constantly working to increase their customer lifetime value

Now that you’ve acquired a customer, it’s time to actually make a profit. 

It’s not hard to notice that our most successful clients are the ones that have higher customer lifetime values and are constantly working to improve them. 

They work on their product, test new offers and approach customer service professionally. 

They also work in managing their communities, which is (as is the case with this client) especially important if your subscription offer is information/expert-based. 

It’s easier to sell to your existing customers, and if you’re constantly finding new ways to provide value to your customers, you’re doing it right. 

Now that the foundations are out of the way, let’s get into the actual customer acquisition process. 

Let’s go behind the scenes of a campaign that generated $1,000,000 in revenue through Facebook and Instagram. 

Here’s what the actual numbers were: 

That’s pretty badass, right?

Here’s what we’ve done (in this campaign, and in countless others for the world’s leading fitness experts) and what you should do to achieve the same: 

1. Optimize the Funnel – #1 Goal On The Front End is To Build a Customer Base (Low Entry Point) And Breakeven 

Average order value (AOV) is the most important metric to track when driving paid traffic to your subscription offer. 

Optimizing your AOV in a way that it’s high enough to pay for your traffic costs, and acquire a recurring customer for $0 (breakeven) is crucial to this process.  (In this actual campaign, we were actually profitable on the front end – which is always nice).

And your AOV has a lot to do with how your funnel is set up. 

While this was not our task as we manage traffic campaigns, we’re highly involved in our clients’ funnel optimization processes as that directly affects the return on investment from paid advertising. 

Here’s how the optimized funnel looked like for this campaign :

Funnel structure

This was not how it started – we tested a lot of different offers and combinations until we got the AOV where it is now. 

For example – we found that the best layout for the landing page (first page a person sees after clicking the ad) looks like this:

Landing page

Here’s how the actual numbers for the funnel looked like: 

In conclusion – optimizing your funnel is crucial as it will determine your AOV, and AOV is directly tied to achieving break-even on advertising – and that is what the main goal is.  

Generally, this is an ongoing process and should continuously be worked on as there’s always room for improvement. Always try to improve the conversion rates for each step of the funnel.

2. Segment your audiences and adjust your approach to each segment 

There are a lot of different stages of the buying cycle – a person who sees your ads for the first time is not in the same stage as a person who’s already on your email list.

Depending on the stage they’re at, you want to serve them different types of content and different types of creative.  

To do that – you first need to segment your audience based on their familiarity with you or your product. 

This is what Facebook ads platform is really, really good at. 

You can micro-segment your audience using the Facebook pixel and Custom Audiences – and you should. 

Here’s how that looked like in this campaign: 

With audiences that were already familiar with the brand we were more direct and upfront with the actual offer. 

With cold audiences, we adjusted the copy and the creatives to get people familiar with the brand first (social proof and the brand story worked really well). 

Cold audiences are ALWAYS going to have a higher CPA, but they’re necessary to achieve scale (unless you have a huge brand/audience). 

Combining both cold audiences and warm audiences with an optimized approach to each will allow you to achieve both scale and profitability (breakeven on the front-end in this case). 

3. Optimize Your Creatives And Use Video Ads 

While creatives (copy/images/video) were always super important, with Facebook’s ad algorithm changes and improvements, other parts of the campaign such as targeting are becoming less important as the algorithm will do a lot of the work for you.

Facebook’s algorithm prefers video to image creatives.

That means that on the video ad campaigns, the CPM (and consequently CPC) will be much lower – you’ll pay less to acquire a customer.  

Here’s an example from this campaign:

Both ads ran to the same audience but the video ad was actually profitable (on the front end) which allowed us to scale the spend and actually reach 7 figures in revenue in the end. Cost per acquisition is one of the 2 important metrics and using video is a big part of why we managed to get the CPA where we needed it to be (and lower). 

Video quality and structure are definitely important and we did a lot of testing – but even with a lower quality video (because Facebook’s algorithm prefers video) you’ll get much better results than with static creatives. 

This is not an end-be-all solution – you have to split test relentlessly in order to find the best performing ads. In this campaign, the total number of variations was over 500.

4. Use Different Advertising Angles To Hit Different Pain Points 

The concept of angles in advertising is something that a lot of people either don’t understand or don’t understand the potential and how powerful it is. 

In order to convert the biggest percentage of your audience, you need to solve their problems. 

The product we were selling was a fitness product, and essentially it was the same product for everyone who bought – but not everybody is going to buy for the same reason. 

Not everybody in our target audience is experiencing problems in their fitness the same way, and not everybody wants the same outcome. Here are some examples:  

  • Some people want to lose weight to look better
  • Some people want to be healthier
  • Some people want to have more energy to work more efficiently

There are a lot more examples but you get the point. 

The better you describe the problem your potential customer is having, and the better you describe how you’re going to solve that problem and get him/her the specific outcome he/she wants – the better your conversion rate will be. That’s what angles essentially are. 

You need to have different angles that will speak to different segments of your target audience. 

In fitness campaigns, like this one was there’s a high level of seasonality and you should definitely capitalize on that by creating angles specific to different seasons. 

5. Use The Right Ad Placements And Ad Objectives To Achieve The Highest ROAS

This is one part of the technical part of the campaign, which is crucial to success on Facebook. In order to achieve the best results, you need to understand the platform.

Facebook (and Instagram) is fairly complex compared to other advertising platforms and you need to know what you’re doing (or hire somebody who does). 

As far as the placement goes, the news feed is still the king. In this campaign, the mobile news feed was the best performing placement. 

What’s generally happening with both ad placements and targeting is that the algorithm is getting smarter. Before you needed to micromanage both but as the algorithm improves it’s better to go wide and leave the optimization to Facebook. If you optimize for conversions (lowest cost) and select all the placements, the algorithm is going to actually determine which placement brings you the most conversions at the lowest cost. 

What’s really important here is that you adjust your creatives for different placements as they look really different and format that works on one placement will not work on the other. 

With Ad objectives, you should generally use the objective that you’re aiming for and that’s what we’re almost always doing. If you’re looking for traffic – use website clicks, if you’re looking for conversions (which in this case you will) – use conversions objective. 

CONCLUSION

The Facebook advertising landscape is getting more complex every year, and you need to stay on top of your game to compete. You must stay up to date with all the changes to the platform and the actual ad algorithm in order to get the best results from your advertising efforts. 

You also have to know your numbers – not just Facebook ad stats but your full-funnel metrics, in order to advertise profitably. Without knowing your customer LTV, you can’t know how much you can pay to acquire a customer. 

On top of that, you have to understand that you’re marketing to people and that old-school marketing concepts and truths still apply – a lot of the times the changes that will bring you the best returns are changes in the way you speak about your products or services.

NEXT STEPS

Growing your online course/membership business to 7-figures and beyond is possible. You just need to dive in the deep and find out your unique formula.

If you’re already advertising on Facebook/Instagram and want to scale your ads to $3k+/day, we can help. 

Schedule a call with InfoScaling Team to find out how we can help you. 

We’re going to talk about your business, what you’re currently experiencing with your ad campaigns and how to improve them. 

At the end of our 30 minutes together, if you meet the criteria we might offer you to work with us. 

The call is 100% free and no strings attached.

Here’s the link again.