Facebook Advertising as Low as 3 Cents a Click with AdEspresso CEO Max Chieruzzi

In social media marketing, probably 95% of a blog post start with you should be open and transparent. What the fuck? Of course, do you need to write a blog post to tell me that I should be open and transparent? What should I be closed and shady?

Do you want to impact the world and still turn a profit? Then you're in the right place. Welcome to Growth Everywhere. This is the show where you'll find real conversations with real entrepreneurs. They'll share everything from their biggest struggle to the exact strategies they use on. a daily basis. So if you're ready for a value-packed interview, listen on. Here's your host, Eric Siu.

What's the number one problem all businesses face? It's not sales, marketing, or product-market fit. It's hiring. We know just how hard it is, so We've compiled 25 hiring tips from top CEOs that I've interviewed here on Growth Everywhere and put it into a free resource just for you. Text 25TIPS to 33444 to get the free resource now. Again, it is 25, the number 2-5, tips, T-I-P-S, to 33444, and you'll get the free resource. Hello everyone, and welcome to this week's edition of Growth Everywhere, where we interview entrepreneurs and bring you business and personal growth tips. Today we have Max Chiuruzzi, who is the CEO of AdEspresso. Max, how are you doing today?

Great. Hi, Eric. Hi, everyone. Thanks for inviting me.

Yeah, thanks for being here. So why don't you start off by telling us all about your company and then we'll go from there? Sure.

So AdEspresso is a SaaS solution for Facebook advertising optimization. Before starting AdEspresso, I had an agency and we were running Facebook advertising, but we were pretty small, so we felt the need to optimize our advertising by split testing, by managing bids and budgets, but we didn't have the deep pockets to use the enterprise tools and there was nothing that we could afford at that time. So we started working on AdEspresso with the idea to create a very simple yet powerful Facebook Ads Manager for small-medium businesses, everyone spending between $2,000 and $25,000-$50,000 per month in Facebook advertising. And to make it really, really simple, we focus a lot on the user experience and we allow our customers to very easily test everything from the design. Maybe they want to test 5 pictures, 5 titles, 5 demographic targets. That will be 125 ads to create on Facebook. It will take forever, while with AdEspresso you can create 125 ads in literally minutes. And then you have super simple analytics that give you actionable tips like, hey, this picture is not working for female 18 to 24 years old. It's costing you 70% more than the average. Stop it now. And we also, we are also adding automation so you can just create optimization rules for your campaigns and just let AdEspresso do everything for you.

Got it. Okay. Now let's talk a little bit about your background as it led up to AdEspresso. So you talked about the agency. Tell us about how everything led up to AdEspresso.

Sure.

So I started when I was 18. I've always been kind of a geek, so I always loved computers, etc. When I was 18, I started doing the tech journalist, and you know, it was the dot-com boom, so it was super funny. Lots of free travel from big American companies here in the US, and since it looked like everyone was becoming rich with internet, I decided to start my agency in Italy. And of course I started the agency just like a month before the bubble exploded in 2000. But yet we did very well. We became sort of boutique web development firm. We were like the biggest developer for eBay across Europe. And we focused on very big projects that needed to scale, needed to be reliable and secure. And yeah, we were also running Facebook advertising for some of our customers. We felt, we saw that there was this hole in the market and we were all, we love technology, we love building product, but sometimes, you know, it can be really boring to build products for someone else, to never have control on what you are doing. So we decided to shift from the agency business to AdEspresso. We started with Audi in Italy and then in October 2014 we got accepted in 500 Startups and there we made the big step. We moved to United States and from there we kept growing a lot. So very exciting so far.

Yeah, awesome, man. Congratulations on the growth. Why don't you tell us a little bit about how your growth is happening today, you know, whatever you can reveal around those.

Sure. So last year we grew in a year 10 times, which was pretty exciting. And this year we are basically growing 30% month over month in terms of revenue. We are basically nearly profitable. And also in terms of Facebook advertising managed, so how much, how many ads our customers manage through AdEspresso every month, we started like a year ago that we were managing less than $100K. per month in Facebook advertising, and today we are basically reaching $2 million per month in Facebook advertising managed.

Nice, great. So again, congratulations on the growth, and I have to ask you, those numbers are 30% month over month, that's phenomenal. So how are you going about acquiring customers today? What's kind of the big smoking gun?

So our strategy is mainly based on content marketing, And Facebook advertising, of course. Targeting small-medium businesses with a very low price point, AdEspresso starts at $49 per month. Using sales team is not a good way to go, at least not for us, in our opinion. And there is also a trust issue because our customers, to start using the platform, they need to give us permission to manage their advertising. There are money passing through our platform. So, We discovered that if our users discovered us through the content first and they recognized us as thought leader in the Facebook advertising industry, not only was it a great acquisition channel because it's inbound marketing, it's extremely cheap, but it also increased the conversion rate and the lifetime value. A customer that first discovered our content, then downloaded an ebook and became a lead, and then started to use the platform, has a much higher lifetime value compared to a customer that just arrived to a landing page, subscribed, and maybe doesn't know exactly what is split testing, how to split test. So we create unique content. I see that as a huge— it's a huge opportunity and a huge problem. If you do content marketing, you need to do it right. You need to create something valuable for your customers. It's not just about pushing out the usual stuff, you know, in social media marketing, probably 95% of the blog posts start with, you should be open and transparent. What the fuck? Of course, you need to write a blog post to tell me that I should be open and transparent? What should I be, closed and shady? So you really need to push out great content, unique, that really adds value to your customer, no matter if they are a customer or they will never buy the product. And then when you have great content, Facebook advertising becomes a really huge weapon to maximize that content. So content, Facebook advertising to reach as many users as we can with the content, and then we have built a funnel. So once you visit our blog with website custom audiences from Facebook advertising, we retarget you and we tell you, hey, we also have this great ebook that you can download. We only want your email. for example, or your email and your name. We convert them into user and into leads, and then we use HubSpot to do lead nurturing and with time convert them into paid customers. And this is extremely effective for us.

That's interesting. And let me just back up a second and tell everyone, if you haven't seen AdEspresso's lead generation with Facebook ads post, and I'll put this in the show notes, but it's a phenomenal post for those people looking to get into Facebook advertising. So that's one plug for you.

Thank you.

You're welcome. It's a really great post. So I have to ask you, a lot of people talk about having great content first and then sending Facebook traffic to it, right? And maybe remarketing to those people and pixeling them as well. A lot of marketers, myself included, I've been skeptical in the past in regards to this because to me it's just like, in the past it was like, okay, Is it really worth it to spend this money? I mean, I'm just increasing my acquisition costs at the end of the day. So what would you say to marketers that are hesitant about spending money to drive people to their content and even remarketing to them?

Just try it. I mean, compared to Google AdWords, Google AdWords is demand fulfillment. It's pretty simple. You can read a blog post with 5 tactics. It will work today, it will work in a year. Facebook is a really dynamic marketplace for advertising. What works for me may not work for you. Maybe lead generation works for me and for you, but it won't work for someone of the listeners. So thanks God it's not television advertising where you have to commit, I don't know, $100,000 to test it. You can test with $100, but I think it's extremely effective. For example, in our case, the overall cost of acquisition of doing this funnel, acquire traffic, convert into lead, and do lead nurturing, in the end is much cheaper, probably more than 50% cheaper than sending traffic traffic directly to the landing page. And this is something that many companies saw. Rand Fishkin from Moz, of course, published probably last year some numbers about the fact that the users that they acquired through content had a much higher lifetime value compared to the users that they acquired directly through advertising.

Got it. Okay. Now let's talk a little bit about your funnels. What's going on in your funnel at a high level?

So as I told you, yeah, we acquire the traffic, then we convert them into leads. After we have a first contact, we usually send a flow of 3 to 4 emails. First, we send them other freebies like, hey, we have another ebook, hey, we have a free tool, and after that we let them discover the product. So, hey, we also have this product. A good percentage of the users subscribe to the product. And then let's say we have 2 more big steps. The first one is that they have to connect their Facebook advertising account, where we probably lose 20% of the users there, which makes sense. You know, it's a pretty standard conversion rate. And then they start their 14-day trial. During the trial, we try to help the users as much as possible. We have a webinar every Wednesday where we walk them through AdEspresso, but we also give them generic Facebook advertising advices. And we have a customer success team, so we try to follow up via email. We have never sent an email from noreply@adespresso.com. Every email is sent directly by my address or someone in the customer success team. So whenever they want to reply or ask anything, they can reach out. And yeah, at the end of the 14-day trial, they either stop using the product or they convert into paid customers.

Awesome.

And after that point, yeah, we keep reaching out to them to check if we can help. Because this is something that I think applies to everything. I see lots of people saying, hey, use our tool and even if you don't know anything, you will improve your conversion rate, you will improve your performances 200%. Automatically. That's all bullshit. It's just a tool. I mean, it can help you a lot. It can save you a huge amount of time. It can help you refine your performances, decrease your cost a lot. But if a user doesn't know what he's doing, the tool is worthless. It's like giving a Ferrari to someone that always drove a bicycle and never drove a carriage. He's probably going to kill himself. He's not going to be a Formula 1 champion. Cool.

All right. So, that makes sense. And so, you guys are doing a lot of— okay, it sounds like a lot of content marketing. Well, and I want to add great in front of it, so great content marketing and also you're doing Facebook ads. What is one unique thing you're doing to acquire new customers today?

Hmm. Let me think about this. I have to repeat myself. I think it's still the content, the unique things that we are doing. Not because no one else is doing content marketing, but since we have a tool and we have a huge amount of data that we can use for the content, that's really unique because there are lots of smart people that can write about Facebook advertising, but they cannot analyze millions of dollars in Facebook advertising like we can through a platform. So our really— what is really effective and unique in our strategy is that we can enrich all the content that we push out With a lot of data to back what we are saying, and we see that users really appreciate that. And I think lots of companies are not doing that. They have lots of valuable data inside the company, and they're not getting the most out of it.

Ah, see, yeah, that's the thing. Yeah, I mean, you know, I think I'm thinking about companies like OkCupid that have those blog posts with all that data, so I get what you're saying now. And the thing is, you know, I'm staring at your blog post right now. It looks like you've This is a 6,000-worder post. How much time are you putting into each blog post, and also how much time are you putting into each image for these blog posts?

So, a blog post like the one on lead generation, which is 6,000 words, is probably a couple of days to write, do the research, but it's something that probably I've been thinking of for a week or two. So I'm constantly thinking about new content that we can push out. A normal blog post is usually around 1,500 to 2,000 words, and nowadays I can manage to write it probably in half a day. And then of course there is the time that is spent by my coworker fixing the English, because as you can hear, I'm not clearly a native English speaker. And for the picture, we At the beginning, it was extremely time-consuming. We knew that it would pay off to set us apart from the crowd, even though it was probably taking half a day, a day for our designers to create every unique picture. But nowadays, you know, we have done so many pictures, we have lots of templates, lots of our mascot in every position. So probably in a couple of hours, we can come up with a picture, which works very well because our users now remember us. But we have great content, and when we do Facebook advertising, having that unique illustration style for every blog post, they immediately recognize our ad, and that increases a lot the conversion rate compared to using the usual stock pictures.

See, that makes a lot of sense from a branding perspective. I'm imagining your costs probably go down because you spend the extra time on these images, which makes sense across the board.

Okay, great.

So I'm curious, how much are you spending at each step? So let's just say, how much are you spending on each content click and then to collect an email and then to get an actual trial just so people know how successful you are? And any ballpark number is fine.

Sure. So the place where we are spending more money is the lead generation. In terms of the initial traffic acquired to drive traffic to a blog post, We are probably spending, I would say, between $600 and $1,000 per month. We don't pay that much. It really depends on who we want to target. So we have a couple of different targeting. Sometimes we advertise to acquire totally new users, like we do interest targeting to our competitors, top blogs in the industry. And for those ads, we probably pay around $0.10 per click.

Wow, so 1 penny? Yeah.

Wow, okay.

No, wait, 10 cents.

10 cents, okay. 10 cents for interest targeting, wow, that's phenomenal. My team's paying 30 cents doing interest targeting.

Yeah, no, that's pretty good. And sometimes we just target website custom audiences. So we target people that already visited the blog but never became leads, so they never left us their email. And there it can really go down to 3-5 pennies. Okay, so that's extremely effective. The ebook, the lead generation on the ebook, it's a bit more expensive, so probably we are spending something like $2K per month in that kind of advertising. And again, when we use website custom audiences, it's extremely cheap, probably around the 20, 30 cents, while when we use interest targeting for the ebook, it gets more expensive, and there are huge differences between the countries. And this is something that I think every advertiser should care about, and it's very important to track multiple conversions. For example, right now I have a campaign going on for ebooks, and I'm getting ebooks from Brazil at probably $0.50, which is extremely good. And while in Sweden, I'm paying $2 to get an ebook download. But on the other side, since we are also tracking additional conversions, so we are tracking also how many of those users convert into trial, how many of them convert into paid customers, we realize that after all, the cost per— the real cost per acquisition of a customer was much lower in Sweden compared to Brazil, where we had huge volumes of download but not a great conversion rate into paid customers.

Wow, okay. So, $0.20 to $0.30 for a custom audience targeting for the ebook. In the United States, I'm not sure if you mentioned the United States right now, but how much are you spending for ebooks there? And are you only targeting people for the ebooks that have viewed your content already, or is this completely new targets?

No, we do a bit of both. When we use the custom audience website custom audience, Even United States are pretty cheap. We are probably at $1 per ebook in United States. When you go with interest targeting in United States, that's unlikely one of the most expensive places in the world, so we probably get to $2, between $2 and $4 according to the ebook.

Got it, okay. And how about around the trials?

We don't do any more advertising to convert users into trials.

Got it.

We use HubSpot and we do lead nurturing via email to convert the leads into customers or to try it.

Okay, perfect. We could talk about this all day because I love nerding out on this stuff, but let's continue on, man, and I might come back to some of this more. Why don't you tell us about one big struggle you faced while growing the business?

Oh, there were a lot. One, it's always scaling. with Facebook, specifically to Facebook advertising. Because when you are small, you start your first $100 campaign, you see that you are acquiring signups for 10 cents, and you say, oh, okay, I can scale these and I can acquire 1 million users with $1,000. But then you realize that as you scale your advertising, and this is true for every for every marketing company, for every company that does marketing, for every advertising channel. As you scale, things become more expensive and it becomes really tough to keep the costs under control when you don't need to reach 1,000 people, but you need to reach 100,000 people. So that was one of the big struggles. The other one was to find a great content writer to help us with the blog. You know, with a company, a startup to run, I love writing the content, but it's very tough being consistent. I can always write a blog post per week, more or less, but we wanted to do more. It was really terribly painful to find good content writers.

Okay, and where did you go to find your, you know, these great content writers?

So the first A couple of things that I did. The very first thing that I did was post a job on the Problogger job board, which in terms of volumes was great. We received like 200 emails in a couple of weeks from there. But on the other side, the downside was that we received 200 emails and we had to check all this content right there. And of course, we all say that we are great, so that was not really a viable solution and Overall, the quality was very low. They were not reading the job description. Even if we said we want an American, most of them were in other countries and were not native English speakers. Then we used the job board at inbound.org, which was much more qualified but really low volumes. What I do right now is I simply go on blogs that I love and I monitor through Google normal Google search. I monitor all the guest posts that get published on blogs that I appreciate, that I know that have a very strict guest blogging policy. They only accept high-quality people. So I just monitor them. Whenever I see an article that I really like, that is a blog post, and of course it's not from the CEO of another company, but it's from a freelance writer or from a Facebook marketing expert that is trying to sell their services, I just approach them. And ask them if they would like to write for the AdEspresso blog. This is working out pretty well.

Awesome. I'm staring at your blog right now. Do you have them ghostwriting for you or is their name appearing?

No, no, no. I was a journalist when I started out and I'm totally against ghostwriting. If you write something, you should take the merit for what you write. On one side, it's for them because I think it's gratification to see your name in the signature of something that you write.

Hmm.

And on the other side, it's also for me because I don't want to— that there are things written not by me that maybe sometimes I agree, sometimes I don't agree. But if it's a point of view and it's just numbers, everyone can have their point of view. But I just don't want it with my signature if it's not what I think.

I love it. You know what? I just keep staring at the blog right now. The images are so good. Now, okay, how much are you paying these writers just so startups looking to get into content marketing will have an idea?

We were pretty lucky, I think. We are paying them between $100 and $200 for a blog post.

That's a good price, man.

I mean—

That's a very good price, yeah.

Yeah, internet marketing writers are really hard to come by and sometimes they're— we're talking Anywhere from $300 to, in some cases, $800 plus. So yeah, good deal. Okay, so was there at any time— was there at any point in time where the company was on the brink of failure?

No, we have been in business for just a year right now. So luckily, since we started, it's been a crazy ride, but we have always been growing. So, so far we have not— we have never been near the Of course, it can happen anytime, but so far so good.

Great. What's one piece of advice you'd give to your 25-year-old self?

Immediately ask for the money. When we started AdEspresso, I think it's common to a lot of founders, I wanted to be perfect and I was never ready. I would have kept Probably if it was for me, it would have been in beta today, in pre-beta today, because I was always, no, but we are missing this part. We cannot charge our users until we have this part. It's not ready. And I kept delaying. And 500 Startups was really helpful to fix this. So they really told me, both 500 Startups and Armando Biondi, which is our other co-founder. They joined the company when we moved here in the United States, and they were a big push to start charging the users. Otherwise, I would have probably never started charging until we had the perfect product, which probably would have happened after the bankruptcy.

Okay, cool. What's one productivity hack you can share?

I don't have any. I'm a totally disorganized person. I have tried everything for inbox zero, from using Google Calendar to write every single thing that I had to do, etc. But I'm not really the right guy to give productivity issues. I'm totally a chaotic person.

I love the candor. And it's funny that you say you're chaotic, but I look at the blog and it's one of the most organized blogs. Everybody, you have to check this out because I don't normally gush over You know, the design of a blog, but this is great. Okay, what's one must-read book you'd recommend to everyone?

So the book that I really love, even if it's not strictly marketing related, are all the books from— this is tough, I don't know exactly how it's pronounced— Dan Ariely. I don't know if you ever heard of him. It's a behavioral economist. And this guy is just great. He has tested everything. He has tested how people react to paid incentives. He has tested how people react to free products, etc. And his books, even if they have nothing to do with online marketing, are really full of information that you can use to improve your product.

Predictably Irrational.

Yes, that's the first book and it's probably one of the best. Yes, all of them are great. And it's— I got the— okay, it's D-A-N, the name Dan, and the last name is A-R-I-E-L-Y. Dan Ariely.

Yep. Yeah, great. Okay, so I want to take it back a step. You know, when it comes to HubSpot, when, you know, your nurturing sequence, How complex is that sequence? I mean, how many emails are involved with that and how are people getting moved around in that sequence? And you can just really talk about the high level. Sure.

So the first one to convert people that download the ebook into trial signup is pretty simple. According to the ebook that they downloaded, we send a very personal email, hey, did you like the ebook? Can I help you? This is my personal email, just reply. Then we suggest them, we send them the list of all the ebooks that we published, and finally we have a free tool to get a report on your Facebook advertising campaign. And in the end we tell them, hey, you know what, if you like the ebook, if you like the free tool, we also actually have a paid product which is awesome and you should test. So that one is pretty simple. After you sign up, the flow is probably a bit more complex. It lasts 14 days. It's probably around 7-8 emails that we are sending during this period. And we did a lot of integration within the product and HubSpot, so we are passing back to HubSpot a lot of information. And the flow is pretty complex because it has a lot of if-then. So for example, if you have not downloaded, if you have not connected your advertising account, you would receive an email. If you have connected the advertising account, you will receive another. If you have connected it and you have spent $2,000 in the last month, you are going to receive an email. If you have connected it and you have spent $200,000 in the last period, you will receive a very different email. And then it also differentiates based on the feature. So there are some things that we really know that people like about AdEspresso, but sometimes users don't do. So based on their activity on the product, we differentiate the mail to have them perform during the trial the most important feature or try the most important parts of the product.

Wow, okay. Yeah, I'm not a HubSpot user, so I don't know how it works exactly, but the ability to be able to segment people around based on revenues, that's a built-in feature?

I mean, it's not based on revenue, it's simply based on specific property of the user. So we have built our own API that at night sends specific information from the product to HubSpot, and then on HubSpot you can simply say if field X greater than 50, then do this.

Got it. Okay.

It requires a lot of— a bit of development, but it's pretty doable. I like HubSpot because they have landing page, they have so many tools. inside your product. If you only want to do email drip emails, if that's the only focus, probably there are more cheaper and advanced products like Getvero, Infusionsoft, there are a bunch.

Got it. Okay, perfect. Now, Max, what's the best way for people to find you online?

I mean, I always check my blog, so if they want to leave a comment, I always respond to any comment. Or they can find me on Twitter. My Twitter handle is Massimo, M-A-S-S-I-M-O-C-W, which is a big tip for everyone listening to this episode. Never create a Twitter handle with the name of a company inside, because now the company is @despresso, it's no longer Creative Web, and I have this CW at the end of my Twitter handle.

Great. Well, you know what? We will put that in the show notes as well, just in case anybody gets confused. But everyone, this is Max Kioroutzi. I hope I pronounced that right, from AdEspresso. Make sure you check it out. There's a free trial for you all to check out. Thanks, Max.

Thank you, everyone. Bye, Eric. Thank you.

What's the number one problem all businesses face? It's not sales, marketing, or product-market fit. It's hiring. We know just how hard it is, so we've compiled 25 hiring tips from top CEOs that I've interviewed here on Growth Everywhere and put it into a free resource just for you. Text 25TIPS to 33444 to get the free resource now. Again, it is 25, the number 25, tips, T-I-P-S, to 33444, and you'll get the free resource.

Thanks for listening to this episode of Growth Everywhere. If you loved what you heard, be sure to head back to growtheverywhere.com for today's show notes and a ton of additional resources. But before you go, hit the subscribe button to avoid missing out on next week's value-packed interview. Enjoy the rest of your week and remember to take action and continue growing.