130: Are Paid Ads Worth It?

Are you plugging along, building your audience, making a few sales, and wondering if this is really as good as it gets? I want to talk to you today about paid ads. Are they worth it? Do they really make a difference? I've got a lot to talk about on this episode, so grab your earbuds and come join me.

Welcome to the Launch Your Box podcast with weekly tips, tricks, and strategies to start, launch, and grow your subscription box. We Now here's your host, Sarah Williams.

Welcome back to the Launch Your Box podcast. Today we're talking about paid ads. Are they worth it? I struggled a lot with this in the early stages of my business, so I want you to know that I understand where you're at and where your feelings are on this. I was so careful about where I was spending my money in the early stages of my business, and I didn't understand the value of running paid ads. But let's face it, when starting your business, money is tight. I mean, you're paying for a website, some branding, packaging, products, like the list is endless. And it feels like there's a never-ending stream of money leaving the bank before you ever start making sales. You're on a limited budget. And for a lot of you, that's the number one reason why you haven't run paid ads, you're on a limited budget. New business owners often feel hesitant because they don't understand the ROI. And the ROI is return on investment. You don't understand the ROI on paid ads. Successful ads don't always result in sales. So I want you to remember that. Sometimes there's a lack of knowledge around setting up and running an ad campaign. I mean, how many of you listening have ever been in the back of a Facebook Ads manager, the business manager? Like, it's overwhelming. There's so many options. There's so many choices. And you get in there and you think, okay, today's the day I'm going to start running ads. And then you get in there and freeze because you don't know what to do when you get in there. Sometimes we don't run paid ads because we have a focus on organic growth strategies. And I 100% believe in organic growth strategies. So I don't want you to hear me say that I discount that, but sometimes we get so focused on SEO, the content that we're producing, getting it out there word of mouth, that we just don't have time to even think about paid ads. And then there's this last one, the fear of failure. When you fear or you're uncertain about your goal or results, you tend to not take action. I used to feel like I was watching money fly out of my bank account and I had no idea on how to know if an ad was a winner or a loser. I felt like I was just like walking outside and throwing money away. I knew I needed to run ads. I knew I needed to have the advertising budget, but I didn't even know how to measure my results. So I always had this icky feeling about how much I was spending when I was running ads because I never even understood how to measure whether they were successful or not. So every month money was leaving my bank account and I had no idea if it was working or not. And because of these reasons, many new entrepreneurs don't even consider running paid ads. And today I'm going to challenge you on this thought process with some actual data from my recent launches and my paid ad strategy. I'm going to give you some real-life examples. So you're not just hearing me say, do this, do this, do this. I'm going to tell you why. I'm going to give you data to prove to you that you need to be doing this. Now, let's go back a little bit, because if you're sitting here not running ads, I'm going to take you back to the time that Sarah wasn't running ads. Okay, so I was a local brick-and-mortar store. Many of you that know my early story know that I just had a local brick-and-mortar gift shop, and I live in a town of about 100,000 people, and I had local customers, and I was lucky that I had a great local following. I had a lot of word of mouth about my business I was popular in my town. So I never worried too much about paid advertising because I had a constant flow of customers that were local in my store on a daily basis. I had social media accounts, obviously that's where I was posting my products and promoting my business. And at this time I maybe had about 3,000 followers and that, I mean, that's 4 or 5 years into my business. So it takes a long time to get 3,000 organic followers. Let's just be honest. But when I started my subscription box in 2017, I had a great run. But what was happening was it was all my local customers. And even though I was posting on my social media, I just could not grow outside of my local area. And there became a point where every woman in town, it seemed like, it wasn't true, but it felt like, had my shirt on, had one of my t-shirts, had one of my bags, had my earrings, had my things. And I thought the only way that I am going to grow this business is if I get out of my town. There's only so many women in this town that can wear the same t-shirt. And so I thought I could do that on social media and I thought I could do it organically. Inorganic traffic wasn't enough. It wasn't enough because it wasn't reaching anyone outside of my area, barely. Somebody's sister might like my page that didn't live here. Somebody's best friend that just moved away might like my page. I live in a military town, so as people moved away, now they lived in a different town and they still like my page, but it wasn't enough. And I wasn't growing. I had maybe 5 subscribers that weren't local to me, and I kept feeling like I was missing something. I kept feeling like I don't know how to grow this outside of my town. Was it because I had a brick-and-mortar store? That's what I kept telling myself, but I shipped all over the United States, so how could I get more subscribers that weren't local to me? I finally gave in. And decided that I needed to start running some ads. If I can't do it organically, I've tried everything. I had great content. I wrote a blog. I was on Pinterest. I'm doing style guides every month. I'm, I'm live all the time. But it wasn't enough organically. I needed to push that great content that I was creating out in front of people. It does no good for you to create all this amazing content if nobody is even seeing it? I was spending hours and hours a week producing all this content for my retail business and nobody was seeing it. And so I had to push it out there. So I started to run some paid ads. And I remember the first month and I was, I was making good money. I had hundreds of subscribers at this point, but I was even scared to spend $300 on advertising. I was like, oh, $300. Like, that's a lot of money. I guess, I guess this is what I have to do to grow. I've got to spend $300. So I laugh about it now because I was making enough money that I should have been spending double or triple that every single month. I was making more than enough money to be spending $1,000 a month. But man, $300 a month felt like so much. It felt like I was just giving this money away and I wasn't sure if I was getting anything back from it. But within 6 months, my little page of 3,000 followers that I had spent 4 or 5 years building now had over 7,000 followers. I had more than doubled my following within 6 short months by running ads. I spent 4 or 5 years getting to 3,000 followers, and here I was 6 months and I had more than doubled it to 7,000 followers. And you know what those 7,000 followers started doing? Buying more products from my store, signing up for my subscription boxes, engaging in my content. And I was now getting traction from all over the US. People were finding me that never knew me. And it was amazing. And as I started to see that traction, I was like, oh, this is working. Let me increase my ads budget. And so I slowly went from $300 to $600 to $1,200, and it kept going up and up as my sales were growing. My advertising budget kept growing with it, and that's how my business started to explode. I was doing everything I could organically. I was building all this great content, and it was good content and it still is good content, but nobody was even seeing my content. So I was doing all of this work and I was getting no results from it until I started running ads. So let's fast forward to 2023 and let's talk about my most recent launches. I just went through a series of 3 launches in the last 4 months. And I don't recommend that. And I, I'm kind of mad at myself that I pushed all of that onto the last 4 months, but it was necessary and it had to be done. And I'm grateful that I did it. And I'm grateful that I had a team that could support me through it because there's no way I could have done that on my own. But let's talk about some recent launches and how the ads affected them, because I really need you to understand a clear picture of what this can do for your business. Okay. April 2023 monogram box launch. This was a thrown-together launch. Numbers were decreasing in the spring and I needed to put something together quickly to get my numbers back up or I was going to be sitting on a lot of product for May. And so we threw together a monogram box launch at the last minute, and I did all the things that I teach you inside the launch module. I did the lives, I did the posting, I did the emails. I did all the things, but I also ran ads during this launch, and 64% of all the traffic to my Monogram Box sales page came directly from a paid ad. 64% of all my traffic came from a paid ad to the Monogram Box sales page. Y'all, if I would have not run ads for that launch, I would have had less than half of the traffic. And we know that traffic is a direct reflection of conversions. I would have had way less conversions if I would have had 64% less traffic. 45% of all the traffic that I got to my t-shirt club sales page came from paid ads. 45%, that's almost half of my traffic came from our paid ads. Now listen to this one. 36% of all subscription sales came directly from the link in one of my ads. 36% of all of our subscription sales during our launch came from one of my ads. That is hundreds of new subscribers just directly from an ad. My conversion rate from the traffic ads brought in to becoming a subscriber was 3%. What is our industry average conversion rate? 1 to 3%. My ads were converting at the highest average rate for the e-commerce industry. And, and my ad budget was split half warm and half cold. A lot of these people, it was the first time they'd ever seen me, and they were converting. My ads worked. Can you imagine that launch without my paid ads? It would have been a lot less, a lot less. I was already doing the work. You're already doing the work when you show up and do a launch. Why wouldn't you want to put some gas on that fire that you're already building? I was already doing the lives. I was already sending the emails. I was already doing the posting. I was following the launch plan that I have laid out for you inside our Launch Your Box library. If I'm going to do all that work, why wouldn't I want all of that effort to be pushed out? In front of more people to see it. I'm already doing the work. Let's talk about the June 2023 coaching week and Launcher Box launch. Probably a ton of you listening right now came to my coaching week in June. 89% of all the traffic that went to my coaching week sales page came from ads. 89%. 89%. Can you imagine that a little 11% of traffic that I had sent over there organically and how sad that would have been for coaching week, how empty coaching week would have been? 89% of all the traffic that hit my coaching week sales page came from a paid ad. 71%, listen to this one, 71% of all the sales of coaching week, everyone that purchased coaching week, 71% of them came directly from an ad link. It popped up in your Facebook feed, a video view, a story, wherever you were on Facebook. My ad popped up and 71% of you clicked on it and joined coaching week from an ad. And here's the best part. 27% of all the people that came to coaching week, which we already know 71% of them came from ads, 27% of all the people that came to coaching week converted into Launch Your Box members. I had a 27% conversion from coaching week to membership. If I wouldn't have had that 89% of traffic going to my sales page, that 27% conversion rate would have been so Few people. I had thousands of people in coaching week and I converted 27% of them. And the only reason I had thousands of people in coaching week is because of those paid ads. It's a numbers game and we have to use ads to increase our numbers so that our conversions increase. I got one more example for you. July 2023, I launched my Teas for Teachers subscription. This is my lowest number of subscribers, subscriptions that I have. I have 3 subscriptions. This is the tiny one. This is the baby one. It's a— I don't know why it's a hang up for me, but it's the baby subscription. Okay. So if you have a small subscription, you can relate to this. July 2023 Tees for T-Shirts subscription. I had 105 subscribers going into this launch and it was dwindling and I was not doing much about it. And I thought, if I'm going to do something about it in 2023, now's the time before we go back to school. Let's give it the good old college try. Let's pull out the launch plan. Let's get this puppy up and running or let's just shut it down. That's kind of my mentality. I was like, either let's fix this or let's shut it down because I don't have any more capacity. But here is the thing. I didn't have capacity. I just came off of two big launches. My Monogram Box launch, my Launch Your Box launch, and in between both of those, I was speaking at Sub Summit for an entire week, hosting workshops, seeing hundreds of members. I have been so dadgum busy that I just didn't have any more mental capacity to do another full-blown launch. So I needed to use ads to run this launch, and I'm going to talk to you about my lazy launch. That's what I'm calling this one on the very next podcast episode. So stay tuned for that. But 92% of all the traffic to my teacher sales page came from ads. I only sent organically 8% of traffic over there. 92% of my traffic came from a teacher ad. 78% of all the sales came from ads, doubling my subscriber count. Y'all, I doubled my subscriber count and 78% of them came from ads. Here's a little fun fact that I jotted down for this episode today. But normally, I told you my teacher subscription is like my stepchild subscription. I don't give it much love and it's terrible of me, but I'm just admitting my flaw and I'm being transparent with you today. Normally I get about 200-ish views on that sales page a month. That's pitiful. That's terrible. 200 views on my sales page. I can't believe I'm telling you all this. This is for my teacher's subscription. That month that we did this launch, I got over 3,000 views on that sales page. Okay, so let's do the math because this is how we figure things out. 200 views on a sales page times a 3% conversion equals 6 new subscribers for the month. That's honestly what I've been getting every month, 4 to 10 new subscribers, and I'm losing that many or more. So I'm never gaining anything. It's just slowly dwindling by 1 or 2 subscribers every month. Anybody listening feel like that? Yeah, I wasn't getting enough traffic to my sales page. But when you send 3,000 people to your sales page, 3% of 3,000 is 90 conversions, 90 new subscribers. Don't you understand? It's a numbers game. It's a traffic play. We have to use paid advertising to get traffic to our sites. Why aren't you running ads? I made a strong statement at Sub Summit this year that really hit some people like a ton of bricks. And this is what I said. I said, if you don't have an ads budget, you still have a hobby business. Let that sink in. I said what I said and I will stand behind it. What legit business that you know of doesn't have an advertising budget? You're over here hoping and wishing and praying for a legit business, but you're still treating it like a hobby business. If you're over here frustrated trying to figure out why you can't grow and you don't have an advertising budget, I need you to wake up right now. Like, snap out of it. If you want a legit business, we have to treat it like a legit business. So let's take some action. You know I love to give you some actionable takeaways, not just fluff. So let's talk about 3 things that you can do right now. Number 1, I need you to determine your budget. No matter how small, we have to start somewhere. If you aren't spending any money on a regular monthly basis on ads, you have a hobby business. So let's start our legit ad budget. Okay, so here's how we're going to figure that out. If you're currently selling products or services, you're generating revenue, I want you to use the 8 to 10% rule. That's 8 to 10% of your monthly gross revenue should be spent on advertising. And if you're selling less than $1,500 a month, I want you to use a minimum of $150 for your advertising budget. So say you say for the month, last month, you only sold $1,000 worth of stuff. I want you to use the $150. That's the minimum budget. That's $5 a day. I want you to use that as your minimum if you're under $1,500 a month. But I want you to think about it if you're bigger. So maybe you're making $10,000 a month right now. You should be spending $800 to $1,000 a month in advertising. And if you're not currently spending any and you're making $10,000 a month, I can't even imagine what that $800 to $1,000 is going to do for your business. So set your budget. Now, if you're not selling products right now, if you're not generating revenue right now and you're on a limited budget, I want you to start with $150. That's $5 a day. And as you start selling products and start generating revenue, I want you to increase it. Okay, so I want you to start at $150 a month. We have to spend money to build a business. Yeah, we can do it organically. There's a lot of people that do. But remember, it's going to take a long time and it's a hobby business. I want you treating this like a legit business. Okay, so number 1, I need you to sit down with the pen and paper, and I need you to determine your budget. Number 2, I want you to create an ad strategy. We have to go into this with a plan. What's your goal? Is it to drive traffic to your site? Is it to convert people to subscribers? Is your goal right now to build your email list? Is it your goal to build your following? Are you starting out? Maybe you don't even have a website yet. You can start building your social media following with ads. What stage of business are you in right now? We should have a solid ad strategy that goes along with the different stages and seasons of business that we're in. We should be spending money every single month to grow our business. This is called an advertising budget. And if we're not doing that on a consistent, regular basis, we have to change that now. We have to have an ad strategy. Some months my ad strategy is to grow my email list. Some months my ad strategy is to make sales. Some months my ad strategy is to grow my subscriptions. It's different in different parts of the year for me and what we have going on. When I'm sold out of my subscriptions, I'm not putting my ad dollars to grow my subscriptions. I'd rather grow my list. I'd rather build my following. I'd rather sell some product that's sitting on my shelves, taking up space and money in my bank account. So there's different strategies, there's different goals throughout different periods of the year. I cover my subscription box ad strategy in a brand new bonus lesson inside Launch Your Box training library. You'll be able to see what I did, what I spent, and the actual ads I was running for the Monogram Box launch back in April. And of course, I break down all my results in details. So if you want that detailed look, go find that bonus if you're a member of Launch Your Box. So number 1, determine your budget. You can do that today. Number 2, let's create our ad strategy. Let's figure out what we need to do with our business right now so that we know how to run these ads. Number 3 is test and try. It's all one big learning curve, an experimental process. If you never get into Facebook Ads Manager and start poking around, you will never know how to use it. It's this scary thing right now, right? Because you don't know. It's like the unknown. Like, I don't even know what I'm looking at. We gotta figure it out. We have some lessons in different trainings inside Launch Your Box, including a brand new training this month on how to set up a page-like ad so you can start growing your following. You have to get in there. Okay, now when I'm talking about a page-like ad, back in January I was with my mastermind ladies out in California And I had my ads manager strategist there with me and I said, hey, let's show everybody how to set up a page like ad and let's start running it. And I didn't have a page like ad going then too, but I was feeling stagnant with my following. I had hit about 20,000 followers and I'd been stuck there for a couple of years. Like I wasn't really growing my following. I'm running ads. My, my subscription box is growing. My list building is growing, but my following really wasn't growing. So I'm like, let's, let's beef this up. Everybody could use more followers, the right followers. So we started page like ads that week at the end of January, and I put a budget of $10 a day behind it, and that equals like $300 a month. Okay. And I'm getting a page like for 47 cents each. Okay. So I am paying $0.47 for someone that is my ideal customer to like my page. It'd be like me walking down the street, and if I saw somebody wearing a monogram or a cute handbag or something that I would sell, I would give them $0.50 to go follow my page. Would you do that if they were your ideal customer? All day long you'd do that. That's a potential customer for $0.50. I got a potential new customer and a potential new subscriber, and I've gained 3,600 new followers in the last 6 months from my $10 a day ad. New followers equals new traffic to my website, which equals new subscribers. So no matter what stage you're at in your business, you can start using paid ads to grow your business. Paid ads are worth it. If you have good content. You don't want to send a bunch of traffic to your website if your website's falling apart and, and it's clunky. It's like a bad first impression. It's like when restaurants open their doors and like the first day and they have— you have terrible service and terrible food. People typically don't come back. So before you do this, you need to make sure that you've got good content there for them to consume. That your website is not clunky and that you have clear messaging. They need to understand why they're there. And if you want to join us inside Launch Your Box and check out the new training material, all you need to do is text me the word launch and I'll send you a special invitation to join. So text launch to 940-204-0023. Go ahead and get your phone out right now. Because you'll forget. I already know. I'm, I'm you. Get your phone out. Pull up your text messaging. I'm going to repeat it for you. The number is 940-204-0023. If you didn't catch that, pause it, hit the back button. 10 seconds. I'll say it again for you on repeat, but just text me the word launch and I'll send you invitation to come join us inside Launch Your Box. Let's get serious about growing our businesses. Stop waiting around for someone to find you. You go out and find them.