In this article, I’m going to share one of the most significant optimizations you can implement this week to make your paid ad campaigns more scalable.
This optimization applies universally, whether you are using Google Ads, Meta, TikTok, or so forth – as long as you can track conversions via a tracking pixel.
To avoid redundancy and for context for today’s topic, I highly recommend you read my recent Insider+ piece: The Anti-Scaling Loop: How To Scale Paid Ads
In a nutshell, as you increase your ad spend to scale up, your performance becomes rocky.
Your cost per lead skyrockets, and the return on ad spend (ROAS) plummets.
This is caused by various factors, which I will continue sharing (along with the solutions), and here’s one of them:
As you increase your bids or expand your targeting to scale your ad spend and revenue, ad platforms’ algorithms start experimenting with targeting various audience segments within your target market (despite your targeting settings).
This can significantly decrease your profitability for a period of time and strain your cash flow, which sucks – but it gets even worse!
A big problem that may occur during this rocky period is that ad platforms may start optimizing your targeting for the wrong conversion action, resulting in significantly lower ROAS.
Fortunately, it’s temporary – the targeting eventually gets back on track (if you leave it alone and have the correct settings in your campaigns).
However, unfortunately, most businesses cannot afford such uncertainty and strain on their cash flow, as this period can last for weeks and, in severe cases, months.
And the real challenge is that it happens as you scale – not when you’re spending within your means or comfort levels. This causes most business owners to freak out (understandably).
The Solution: Shorten the Sales Conversion Feedback Loop
In other words, feed the sales conversion data to the ad platform more quickly so the algorithm can optimize for the audience most likely to buy your offer.
This is simpler than it sounds; it’s not a technical solution that requires you to learn new skills or hire talent – it’s a strategic one.
Here’s how to do it:
Presumably, you are already using a tracking pixel and telling your ad platform which conversion in your sales funnel to optimize for. This is a standard advertising practice.
The period between each sales conversion (or surge of sales conversions) is your feedback loop.
To reduce the feedback loop, you must shorten the period between your sales conversions.
The more frequently the sales come → the more frequently you feed the pixel → the more the algorithm is trained and kept on track to target buyers.
- For instance, let’s say you are running a weekly webinar.
As you scale up, increase the cadence to twice weekly: Wednesday 7pm and Saturday 11am. Then, as you scale further, start running daily webinars.
If your webinar is pre-recorded, start running a daily webinar.
Better yet, start running a Just-In-Time (JIT) webinar that people can watch in the next 15 minutes, or choose their preferred time from 3 options (such as 11am, 3pm, and 7pm).
The ultimate sales funnel for scale is one with an instant feedback loop. For instance, a low-ticket direct-purchase funnel (aka a self-liquidating or loss-leader offer).
The initial low-ticket sales conversion serves as the algorithm’s anchor, keeping the campaigns on track, more or less.
The caveat to paid funnels is that they’re costly to train, extremely challenging to run on a low budget, and require having high-ticket backend offers to scale – but really, that’s the case for all funnels.
We’ll talk more about paid funnels another time.
That’s the optimization.
To recap, shorten your sales conversion feedback loop as much as possible so you can continually train the ad algorithm and ensure it targets the right people for your offer without veering off path more than necessary (as it can be quite costly).
Stay tuned to Vavoza Insider+ for more scaling tips based on our agency’s expertise. 📈
– Vlad
