Are Facebook Ads dead? (Tips From $1,000,000's In Spend)

Facebook ads are dead. Actually, no, they're not. I'm Zach. I run Flax Labs, an e-commerce scaling agency, and we spend millions of dollars a year on social media ads. Today I'm going to be sharing 3 strategies that you can use to improve your Meta ads results. The first strategy is more of a tip, and that is working on your offer. Your offer is everything that the customer gets in return for them spending money with you. When you're advertising on the social platforms and when you're running any sort of online business in general, you should be continuously improving your offer. There are many different ways that you can improve your offer. So I'm gonna just tap into a few of them that we use at Flax quite often to increase our clients' conversion rates and AOVs through having a stronger offer. I've broken this down into 3 main areas within the offer. The first is price point or perceived value. The second is risk removal. And the third is urgency. The first way you can improve your offer is by including a discount. Now, this is incredibly popular, and I don't recommend using discounts all the time, as you will pick up a lower quality audience over time, over a 2 to 3 year scope as you build your business. But using discounts is a quick way of boosting conversions and getting traffic and users onto your website in the first place. The second is bundling your products. Now, bundling your products is going to increase your price point or your AOV, which will allow you to have more working capital and more money to spend on the initial CPA, the cost per acquisition, which again allows you to scale your ads faster as you're not waiting for cash cycles for quite as long. The third is value add-ons. Things like VIP groups, free video courses, or free products alongside your core offer are ways that you can increase the perceived value and charge more for what you're selling. Next, you want to remove as much risk for the customer as possible. And there are a few ways that you can go about this. The first is through professional branding. Now, the amount of e-commerce websites that I go on to where their colors and their logos are all over the place and inconsistent, it is guaranteed losing them a lot of revenue. So really focus on getting quite stellar branding that looks professional and that is going to give you a sense of authority within the space that you're selling. Branding builds a key element, which is credibility and trust. And another thing that ties into credibility and trust is social proof. Showing social proof like news articles, viral videos, collaborations with influencers, and most importantly, reviews from customers will drastically improve your ad results. Another way to reduce risk for a user is through money-back guarantees. The more creative your guarantee is, the better. For example, Casper, the mattress brand, has a 100-night sleep guarantee. The next main category of your offer is urgency. Now you can increase urgency through scarcity, deadlines, FOMO, teasers, flash sales, and out-of-stock items. Deadlines, like a sale that only lasts until May 8th, is an excellent way to increase the desirability of your product through urgency if used correctly. Brands like Amazon use scarcity to encourage a final sale. If your products sell out quickly or you genuinely have a limited amount, I'd recommend using something like a quantity counter to demonstrate your lack of supply. Deadlines and scarcity are both examples of FOMO. FOMO in general will increase your chance of a conversion. Things like teasers, flash sales, and out-of-stock items also increase your levels of FOMO. Teasers keep your audience engaged and give them a reason to return to your store repeatedly. Flash sales are urgency gold. They tap into scarcity, FOMO, and deadlines. Flash sales can drastically boost sales in the short term, but don't run them for more than a few days as you're going to hurt performance and profitability. The last urgency building tip I can give you is to show out-of-stock items on your website. You can even add different colors of the same product to a product page, showing them as sold out to increase that sense of urgency. By the way, you can book a free strategy session with myself and my team if you'd like us to help you develop your offer. The next core section that I'm going to talk about is building indirect audiences. A question that we get asked a lot is what type of audience settings we use, whether it's lookalikes, broad, or interest stacks. Now, the answer is we use all of them, and it completely differs account to account and brand to brand. But what I'm going to talk about is a specific strategy that we use that gets us amazing results within audience targeting. We call this indirect targeting, and it's where you target a batch of users that wouldn't necessarily fall under your target avatar. What I mean by that is we use certain campaign targeting or interest categories that aren't exactly in line with who we're targeting. For example, if you're selling high-ticket men's clothing, we would target an interest such as golf. Another example is that we found when we're targeting women above the age of 35, using the interest wine has been incredibly successful for us. The goal with indirect targeting is to target an interest that complements the interest or avatar that you are going after. Last but not least, you need to change the way you think about Meta ads tracking and honestly tracking across ad platforms in general. You should take a holistic approach to judging your ads and make sure that you don't get caught up too much in the individual details of each specific ad. Remember that your backend revenue is the most important metric of all, and tracking at the ads level is imperfect. It's crucial to look at the blended ROAS and make your scaling decisions based off of that information instead of the revenue information on the ad and campaign level that Meta provides you. For those of you that don't know, your blended ROAS is your backend revenue divided by your advertising spend on all platforms. Your blended ROAS indicates how your entire business is performing, and it's the metric that we look at at Flax to determine the overarching, the holistic business performance. If you want to go one step further with your tracking, then you should scale off of your backend gross margins. This is your revenue minus your cost of goods, payment processing, shipping and handling expenses, and anything that's not a fixed expense. We use gross margins as a performance metric to indicate how healthy a business is and how profitable it is. And we make our scaling decisions based off of what the business's gross margin is. For example, an ideal gross margin for most of our clients sits around 20%. So anything higher than a 20% gross margin on a daily basis gets scaled very aggressively by us. And when the entire business is doing more than a 20% gross margin, that's when we really start increasing budgets and scaling a business to $100,000 a month and further. If you found some of those points helpful, you should watch my video on lifetime value. Subscribe to me, book a strategy session with myself and the team, and have a really good day. Goodbye.