4  Levers of Profitable Ads

I promise you, you’re making paid advertising harder than it has to be. What’s up, everybody? This is Roy Miller with Vybe Media, back again for the four levers of advertising profitability. Now, I see all the time in my agency, I see business owners trying to effect change on their ad account, make things more profitable, get more money, higher ROI, but they don’t really have a system for what they’re changing and inevitably, they just end up running a bunch of tests that fail, test after test after test, and they’re not getting anywhere. So I’m going to make this stupid simple. I’m going to cover it quickly in front of everybody with a short attention span, and then we’ll go into a little bit more detail at the end for all of you that want to go deeper. So, very quickly, the four levers of profitable advertising are your audience, your ad, your funnel, and your offer. Those are the four things that you can change if you want to get a different outcome from your paid ads. So what your entire math equation that starts with ad spend and ends with you profitability includes only those four levers. The people you’re targeting, the ads you’re showing them, the website or funnel or journey you’re taking them through wherever they land after they click on an ad. And then the offer that you’re promoting or trying to get them to take, that could be a lead magnet, it could be a high ticket offer, it doesn’t matter. But those are the four levers. So the math equation of your paid advertising is not what you want it to be, those are the only four things that you can change to make that math equation different. Now, that’s the high level. It gets a little more granular than that and we’re going to dive into some of that. So when we talk about the audience, there’s two main things that I never hear anybody talking about in the paydown space that I think are critical to the success that we’ve had for clients and the conversations I have with business owners all the time. So the first one is your Market Sophistication. So I think it was Eugene Schwartz popularized this whenever he was alive a long time ago and this is basically saying that your market is at a certain sophistication level in regards to your product or the problem that you solve. So at level one, you’re kind of the pioneer in the space. If you were to imagine being the first laptop or the first iPhone, there’s no competition for a touch screen phone at that point. So all you have to say is,hey, here’s this cool thing we got. Here’s what it does, why it’s different and here, you’re going to want it. Here’s our stuff, buy it. Nobody is competing with you. You don’t have anybody to sort of position yourself against. So it’s the easiest time to market as long as your product is desirable and it solves a problem that people have. Once you get into level two, you start to have some competition. So Samsung’s popped up with a touchscreen phone, maybe Google has. At this point, the advertising needs to focus on just making a bigger claim than your competitor is. So if they’ve got a fast phone, you’ve got a faster one, if they’ve got a lightweight phone, you’ve got a lighter one, if they’ve got a great camera, you’ve got a higher megapixel camera or whatever it is. You’re just making a slightly better claim than your competitor because again, there’s not that much competition. The audience is choosing between you and maybe a couple of competitors and they’re going to go with the ones that have the best specs, so to speak. So once you get into level three, the competition is starting to get stronger and your market is starting to get more sophisticated. That’s why this is the market sophistication spectrum. They’ve been marketed to, they’ve been sold to, they’ve been advertised to, they’ve heard the messages, they’re not as new, they’re not as intriguing, so things stop having the effect that they once had. So when you get into level three, at this point, we’re starting to introduce some mechanisms. So if you want to think about level one, you’ve got what it is. Level two is getting to why it’s better than the competitors. Once you get into this level three, there’s more competition, more sophistication, so you start to actually introduce and explain your unique mechanism. So this is going to start to talk about how it works. So we’re educating the audience a little bit, not just on what it is or what the features, the specs are. You’re going to talk about how it works, what makes it different, why it uniquely solves the problem that they have, things like that. Level four, again, very similar to level two, you’re just going to move into upgraded and better mechanisms. So again, the competition level continues to increase, the sophistication of your audience continues to increase. At level four, you’re starting to focus on a better mechanism, a faster car, whatever is, you’re focusing on being slightly better than the competition. This is still in the, this is basically how it works, but it’s how it works better. And then the last stage is level five where basically people are tapped out. And this is where, thanks to social media, people get to this level five very quickly because it’s so easy to advertise to them. But at this point, your audience has heard all the claims, they’ve seen all the products, they’ve heard everybody talk about all the competitors products. At this point, the messages just don’t work, marketing doesn’t work, like it used to. They’re not motivated by a faster product, or they’re not motivated by a slightly better one or a unique mechanism or any of that. The best thing you can do at this stage is focus on the identity of the people that you’re targeting. So it becomes about one of Seth Gold and famous quotes, people like us do things like this. So you really start to lean into the identity of the audience and focus on who they are. And I think I’m going to mess this up, but I think it was booking.com. They had one where their slogan was Be a booker and the whole ad was about creating the identity of who is a booker? A booker is somebody who does these things, somebody who travels and lives to be on the road and have adventures and all that. So they’re tapping into the identity of who their people are because they know everybody. There’s a million travel websites, nobody’s really surprised or impressed by any of them anymore. So that’s Market Sophistication. That’s one element of your audience. So that’s again, how marketed too are they? How much competition is there? The other thing is your awareness spectrum or market awareness spectrum. And so this is basically everywhere from they don’t even know they have a problem yet, all the way up to they are familiar with you and your offer specifically, and they’re just waiting on some sort of a deal. Now, this is important because the things you advertise to the audience depend on where they are in that spectrum. And I see a lot of people mess this up. Or if you can’t scale, for example, this is one of the main reasons because you might be selling to the wrong segment or the segment you’re promoting to the segment that your ads resonate with is too small for you to be able to scale to the ad spend you want to scale to. So you’ve got unaware. This would be the people, for example, who are, let’s say, grossly overweight, obese, have health problems for their family, and they still eat fried food, McDonald’sfast food, lots of soda, sugar, all that stuff. Like their family is big. They’re big.They’ve always been big. It’s never even occurred to them that it might be wrong or that they might need to do something else. So those are unaware people. They’ve not yet realized that they have a health problem. Once, let’s say, for example, somebody has a heart attack, or maybe their father has a heart attack, and they also have a similar lifestyle. Now they suddenly become aware that there’s a problem. And you can see from that example where there’s a big shift in the psychology of somebody. So if you’re writing ads talking about living a longtime, being around for your kids, the importance of being healthy, that’s going to fall on deaf ears for somebody who is unaware of the problem. It hasn’t even occurred to them that has not become important to them. Their father has a heart attack, they realize it might be lifestyle related. The doctor gives them a little doom and gloom and now they’re like, oh man, I really got to do something about this. But they don’t know what to do. They’re just aware they have a problem. They don’t know what the solution is yet and you can see where the marketing reaching that person would be much more compelling. So in that situation it’d be something like is it true that some people are just genetically bigger? Or is it true that you’ll always be big if you come from a big family? At that point you can see that we’re not actually promoting anything at this point. We’re just really trying to indoctrinate them. But we’re trying to get their mindset to start asking the question. And that’s a question they think they have an answer to. So when you ask it, they’re going to think, well, is that true? You’ll be able to get them and engage with their ads. But you can see right there in that example how different your ad campaign needs to be based on where your audience is in that awareness spectrum. So you could have a problem aware ad trying to target an unaware audience or vice versa, and your ads are not going to work. Your offer might be great, your website might be great, but because you’re not using the right awareness, then the ads are going to fall flat. So from problem aware they move into solution aware. So in our example, this would be somebody that starts to look into options. So they look at maybe going to the gym, they look at walking, they look at Weight Watchers, they look at Atkins, they look at getting a personal trainer, they look at swimming, they look at all the possible options, home gyms, home exercise programs, P90X. They start to be inundated with all the possible solutions for their weight problem. And this applies to anything. So at this point we’re talking to somebody and we’re really highlighting the benefits that they want and that’s what’s going to be more relevant to them. So hey, we’re going to speak to they’re starting to become aware of the solution. So we want to show them how our solution is going to help them get the results and the outcomes. They want a little bit faster product aware. This is again, you could also think of this, I’ve read this in some places, thought of as niche aware. So this would be somebody who is just aware that your niche, they’ve really started to dive down or selected a specific niche. So let’s say in our example, this would be somebody who selected home workouts as that’s the thing they want to do. So now in the umbrella of home workouts, they still got P90X, all the beach body stuff. They’ve got, gosh, I can’t even remember the guy’s name, but there was like a Taebo one. They’ve got sort of all these products that you can purchase online to do workouts at home. So they’re going to pick from one of those. So at that point, they’re aware of the products and then lastly is Deal Aware, Offer Aware, and that’s when they know you exist, they know your pricing. At this point, they’re waiting for the right time or the right deal or the right discount to be able to purchase. Now, in general, with your messaging, if you’ve got somebody in the unaware audience, the main thing you want to focus on is the problem that they’re having or the pain that they’re in. So again, they may not know the challenge yet . So one of the best ways you can hook these people is what I mentioned earlier is just kind of a curiosity, is sort of exposing or debunking a belief that they have that is wrong and that’s how you start to get them sort of thinking in the way that you want them to think. Now, the thing to consider is that in general, the further somebody is away from Offer Aware on the spectrum, the more work you’re going to have to do. So for you to take somebody who’s unaware all the way to purchasing from you in a single ad or interaction is pretty unlikely. It can be very unlikely depending on how good your marketing is. If you have a long copy ad, you got a long video, you’ve got a video sales page. If there’s a lot of opportunity in that one interaction for you to indoctrinate them into thinking the way you need them to think, maybe you can get it. But it’s better to think about moving these people in steps. So from Unaware, where do we want them to go? How do we do that? If we’re targeting somebody problem Aware completely different ad concept? Are we driving them to the same page? Do we have a dedicated page? The journey could be different. That unaware might be a long form video on Facebook that drives to a blog post that has an opt in and then you’re in your email list and now you can promote your products. But a problem Aware might be a long copy ad, maybe an image or a video to an advertorial, but it’s checkout right there. Solution Aware might be short copy, direct response, fonts, image, us versus them type ad and goes right to the product page. So you can see where it’s all the same product but slightly different modifications to the funnel and obviously different ads targeting the different people. So this is how you can think through thistactically in order to make sure that, again, if you’re looking at your ads and they’re not working, this is one question you can ask. Are our ads relevant or appropriate to the awareness level that our customers have, or is there a mismatch there? The advantage to targeting further away from Offer Aware is that the audience is bigger. The number of people who know about your offer is tiny, pales in comparison to the number of people who could benefit from your offer but don’t even know they have a problem yet. And then obviously, that sort of funnels down throughout the different levels of awareness. So it’s in your best interest to try to target all of the spectrums. And you never know where you’re going to be able to find the most scale because you don’t always know which of these segments is going to be the biggest. But this is one reason if your ads are not working, this is one place I always look to see whether there’s a mismatch or whether we’re congruent between the awareness of the audience and the messaging and sort of the funnel that we’re taking them through. So, problem Aware, we’re going to focus on the outcome they want. So if you’re not sure what the words that I’m using, you want to check the video we publish called The Seven Elements of Selling Anything Online. That’s going to explain some of what I’m talking about when I say pain, problem, outcome. So check out that video in the come back and this will make a little bit more sense. So if they’re problem aware, you’re going to be focusing on outcome and pain. So what is the emotion that they’re experiencing right now and what is the outcome, the desired situation they’re trying to get to? For solution Aware, we typically focus on benefits and challenges. So what are the immediate benefits you’re trying to realize and how can we sort of show that our product is going to do that? And then what are some of the challenges,what are your objections to getting started with us and how can we overcome those? Product aware is going to be the same thing, benefits and challenges. And then your Offer Aware is just going to be focused on pricing terms, scarcity, things like that. So once somebody is aware of you, you think about retargeting your bottom of funnel, you’re going to be hitting them with, here’s the reasons to buy now. Here’s a special incentive, here’s why this is a great time to buy things like that. So that’s your audience. You’ve got your sophistication. Where are they in terms of how many offers are competing with yours and how much they’ve been marketed to and then your awareness. Where are they in terms of their understanding of what the problem and the solution are? And are they looking for something like what you’re offering? Now as we move into yourads, this gets pretty straightforward. There’s a lot of testing you can do here. Obviously, we just demonstrated that you’ve got image ads, you’ve got video ads, you’ve got gifs,you can do short copy, long copy, it could be story based copy, it could be direct response marketing, it could be a testimonial. I mean, there’s really the sky’s the limit. But the ads are obviously one of the main levers that you can pull. And hopefully what I just explained to you about the audience will help you better identify the kinds of ads you want to be creating to get the effect that you’re trying to get. Now there’s another video that you can find that is called the Metrics and what they mean. And in that video you’ll find a much deeper dive into how to actually read the data that you’re getting from Facebook or Google, YouTube to figure out more specifically if the ads are the problem or if the problem is in your funnel or somewhere else. So I suggest checking that out if you want to know a little bit more about how to interpret the ad data because that’s another thing and I see people messing up a lot if the math equation for their ads doesn’t make sense. They’re losing money or they’re not making the money they want to make. And they’re doing a bunch of ad testing only to find out that their conversion rate is awful and the ads are actually doing great. The click through rates are fantastic. So that’s one of those situations where you spend a lot of time spinning your wheels because you’re not actually addressing the primary issue. So check out that video for more about how to interpret your ad data. Now we’ve got your funnel. So again, this basically just means where do people go after they click the ad? Are they going to a form on Facebook? And then once they’re in your email, do they get a lead magnet that has a call to action to follow you on YouTube and then theYouTube content has a link to your call funnel? What does that journey look like? Or does it add directly to product page or add to homepage or add to advertorial to sales letter to video sales letter? It doesn’t matter. But that’s the question you have to ask yourself is, is the funnel broken? Because that’s definitely one of the levers you can pull on to change the profitability equation. In general, one of the easiest things you can do is limit the number of steps people have to go through. Just 100% guaranteed, every step you add to your funnel, you will have drop off. There will be fewer and fewer people that take each step. So one of the ways you can increase the results in some cases, just have fewer steps. So add product page checkout done as opposed to add home page, product page, cart checkout, product purchase complete. You can see that all those additional steps, we’re losing people. So you’re just bleeding traffic through your funnel. So one thing to think about is, is it as efficient as it could be? And are we doing a good enough job with, with the pages we’re showing them to make them comfortable buying? Are we showing them everything they need? Does it talk about shipping and taxes and fees and what to expect and what to do next? Is it straightforward? Is it congruent with the ads like we were talking about a minute ago? Are you taking an unaware audience and dropping them on a product page? There’s going to be a mismatch there. Those people are not going to buy. So the funnel is obviously a major point of iterations that you could do and it’s another way to scale. So if you have a certain percentage of people that are buying directly from your product page, great. But there might be people that need that advertorial first. So run both. Run ads to product page for the people that want to buy there, for the people that need a little more love, send them to an advertorial, let them read long blog post, maybe an opt in, maybe a link to the product page, whatever it is. But just recognize that everybody, 100% of your audience, doesn’t need the same funnel. Everybody wants to engage with your business in a different way. So as you think about scaling, it helps to give people the ability to engage with your business in the way that they want to. Now, lastly is your offer. So we talked about audience ads, we talked about funnel. And now lastly is your offer. Those are the four levers of advertising profitability. Your offer is pretty straightforward. It’s the thing you’re selling, either your product or your service, whatever it is. You can try different pricing, you can add bonuses, you can change the deliverables. So obviously, if you have like, say a course, for example,and you’re trying to sell it, it’s not doing great. Maybe you need two more modules on these specific things that you didn’t have before. Or maybe you need to replace two modules with something that’s more relevant to your audience. If you have pricing, you could do payment plans, you can do decreased pricing. Sometimes increased pricing actually affects conversions just because of the perceived value you’ve got. Guarantees, risk reversal, all of these things play into the offer. And this is not a comprehensive list. I’m just trying to get your brain thinking about some things that you can use. So all of that plays into the actual offer, the thing that we’re trying to get people to buy and hands down, no questions asked, this is the most important part of making paid ads work. If you have a good offer, marketing, it is so stupid easy because people want to buy what you have. We’re just giving them the opportunity to do that. If you have a crappy offer that nobody wants, no amount of marketing will make it work. It will take so much time and energy and money for you to test all the ads and creatives and audiences and funnels only to come back around at the end, be out possibly tens of thousands of dollars, only to realize that people just don’t really want what you got. And again, it may not be that it’s 100% bad, but maybe it needs 50% different content or different deliverables. Again, going back into what I was talking about earlier. So just because it’s not working, don’t 100%assume, just flat out people don’t want it. But maybe you need to sweeten the deal, so to speak. Or maybe it has something to do with your messaging. Maybe you’re just not communicating the benefits of that product in the right way. You might be selling, let’s say, people wanted to weight loss, for example. You might be selling better health to an audience that wants to just feel like they look good. And so the product does both things. It gives them both of those. You’re just communicating in a way that is not converting people. So in that case, you just need to change your messaging. The offer itself might actually be good. So that’s it.Those are the four levers of advertising profitably. If you’re having trouble making pet ads, paid ads work. You can only pull one of those levers or more of those levers, but there’s nothing outside of those levers that you can do that’s really going to affect your ad results. It’s your audience, your ads,your funnel or your offer. And that’s the people you’re targeting, the ads you’re showing them, and the funnel or the website you’re taking them through, and then the thing you’re trying to get them to buy. So I hope that makes sense. If you haven’t, go check out the other videos I mentioned. It’ll help you give a little more context everything I’m talking about here. 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