by If you are advertising at the moment you will have noticed ad prices are ridiculously low. They haven’t been this cheap in years and you should be able to acquire lots of new subscriber for a fraction of the regular price. I have spoken to multiple subscription box owners across many different niches and everybody is reporting the same thing.
This is down to the fact that a lot of businesses have pulled their advertising completely mixed with the fact everybody is at home on social media. Facebook ads are run on an auction so if there is less competition and more people to advertise to the prices will drop.
As a Subscription Box owner, you probably want to take advantage of this and try to sign up as many new subscribers as possible. Obviously, it is a terrible time in the world, but that doesn’t mean you should stop advertising. We need people spending money to keep us out of a recession. This will all go back to normal at some stage so it’s important that you continue to push on and pay your bills.
If you are looking to ramp up your ad spend on Facebook this post will help you do it profitably.
One of the big problems with Facebook Ads is it gets more difficult to remain profitable the more you spend. I will give you an example. You might be running a campaign at the minute for $20 dollars a day. This is bringing you in a couple of subscribers and you’re happy with the CPA. You now want to ramp things up and start getting more subscribers signed up. So you increase your budget on that winning campaign to $200 per day.
Suddenly, your old reliable campaign has gone to crap.
Instead of paying $10 per subscriber, your now paying $60 per subscriber. This means your ads are no longer profitable. Your payback period is pushed back to 8 months and you’re now losing money on everybody that signs up. You start to panic and quickly you launch a new $20 campaign. You go back to getting around 2 new subscribers a day and you decide to leave it. 2 new profitable subscribers per day is better than running your business into the ground.
This is a common issue that I keep seeing over and over again.
Now let me explain to you how this person could have scaled their ads and spent more money profitably and got more subscribers in the process. I am going to keep this as simple as possible. I am aware of the more complicated scaling strategies. Some of which I use myself. I am not going to get into them though, as they can be pretty confusing for beginners.
The first thing you should know is never try and edit a live campaign. That means no changes at all. Don’t touch the budget, copy, targeting or any of the settings.
The fastest way to mess up your campaigns is to try and make changes when they are live.
A lot of people recommend the following.
They tell you to pause your campaign and then duplicate it and increase the budget by 10-15%. You then repeat the process every few days until you reach your desired daily budget.
I don’t agree with this for a couple of reasons.
- If you want to spend a lot of money it can take ages to reach your desired daily budget
- More importantly though 80% of the time this doesn’t work. I came across a great analogy which stated this is like playing poker with Facebook and more than likely you will lose. This is very true. When you do this, it might work a couple of times, then out of nowhere BAM your profitable campaign is now wrecked.
I do something called Horizontal Scaling which is completely different to most advice you will receive. I honestly believe this is the easiest way a new subscription box owner can spend more money without their costs going through the roof.
The majority of advertisers will do something called Vertical Scaling.
Vertical Scaling
This is when you scale your ads by simply increasing the budget of your campaign. (This is when you are most likely to run into issues unless you do some of the more complicated scaling strategies)
Horizontal Scaling
This what I recommend doing as it’s the simplest process for a new advertiser. (It also works very well for experienced advertisers) Instead of only having one lever to scale (Increasing the budget) An advertiser will spread their testing across multiple ad sets, audiences and different types of creative with the overall purpose of building a more stable account structure for long-term, scalable success.
This is what the subscription box owner I mentioned above should have done. If I was her this is how I would have handled the situation.
I would have turned off the initial campaign and I would have created a brand new campaign from scratch.
Then, instead of having one ad set spending $20. I would look to add a lot more. If she was running a 1% LLA audience on the initial campaign and it was working well I would create more. I would create a fresh LLA audience split from 2% all the way up to 10%.
I would then have 10 ad sets within the campaign spending $20 per day. So the overall campaign budget has now gone from $20 per day to $200 per day.
Now Instead of acquiring 2 new subscribers per day, I would be hopeful this company can get up to 20 people signed up per day.
So instead of 60 new subscribers per month, they have now gone to 600 new subscribers. This will make a massive difference to their MRR and they can now start taking a wage.
If they weren’t using an LLA they should still copy the same strategy. They would simply make new audiences to target using interest-based targeting and run more ad sets at the same budget. (Just be careful with overlap though)
I can confirm that this strategy can work on a much bigger budget as well. So if you are currently spending a few hundred per day and want to scale up to a few thousand this will work once your audience size is big enough in each ad set.
There is a lot more complicated stuff you can do with Horizontal Scaling but for the purpose of helping this group that’s the simplest way to get started. I may write a more complicated post about this in the future if people think it would help them. I hope this post will help you. Now if anybody has any questions about Facebook ads or subscription boxes in general just drop a comment below.
