How We Scaled Ad Spend From $2k to $20k a Day While Reducing CAC By Over 50% In Under 6 Months
Before I dive into yet another whopping case study, I must give you a disclaimer…
I’ve managed advertising for 8-9 figure brands in the information and e-commerce industry for the last 5 years.
My team and I work closely with 25-30 clients annually and manage more than 3 million dollars in ad spend every month.
To add to this, ROASBeast, my agency, is an official Facebook, Google and Tiktok partner.
Now onto the juicy stuff.
What you came for.
How We Scaled Our Client’s Daily Ad Spend From 2k to 20k a Day and Spent Over $6m In 18 Months Extremely Profitably
But that’s not it…
I’m going to share with you some other insane improvements we made in their business, like…
- Reduced CPL from $18 to $9
- Reduced Customer Acquisition cost by 50% at scale
- Increased customer conversion rate to a groundbreaking 60% in a 4-step funnel
- Saved the client $5k in cold hard cash per each client they signed up
Let’s get into it.
What Does Our Client Sell?
They run an education company which helps individuals land high-paying jobs in the tech industry for some of the biggest software companies.
Their offer has four stages:
- Three Step Screening
- Job Placement
And only once the applicant is placed into a job does the client get paid
This is where things get interesting.
How We Saved $5,000 Per Customer Acquired Right Off The Bat
The client was losing $5,000 per job placement as they’d use this as an incentive to get people through the program.
When we started looking at the backend data, we realized that people signing up from the $5k incentive ads were not converting well on the backend.
I suggested they remove this incentive entirely.
We tested it, and well…
We were able to reduce the backend acquisition cost and also save them $5k per job placement!
How We Scaled Ad Spend From $2k to $20k a Day (Extremely Profitably)
Of course, it didn’t happen overnight.
But it also didn’t take years.
Just a few months.
Here are some things we did:
- Restructured their campaigns and created multi-funnel events
- We tracked each page vs the lead acquisition page (remember, low CPL doesn’t mean low CAC)
- Optimized campaign for Steps 2, 3 and 4 instead of initial lead acquisition (the biggest game-changer)
- Tested new creatives and new content in the form of advertorials
- Introduced TikTok and got a $120 average CPA, while FB was giving us $200
- And, of course, eliminating the $5k they were losing gave them more money to test and scale with higher margins
A lot of the stuff above I discuss deeper in the case study video I recorded, which you can watch below:
Here’s where things get crazy.
The Highest Performing Creatives Were Giving The Highest Customer Acquisition Cost
Don’t let the numbers fool you ever.
Cheap CPC/impressions/leads are all vanity metrics if they’re not bringing you customers.
Leads don’t make you profitable.
And that’s why we entirely wiped out most of their existing creatives and began testing new ones, as the current ones were attracting cheap leads but very high customer acquisition costs.
In our new ads and creatives, you could say we focused on the boring stuff which you’d think would deter people.
Deter, it did.
We were able to attract many higher-end applicants with higher chances of completing the program.
And that’s how we were able to increase the completion rate of the program to 60%!
I’m still amazed when I look at these numbers…
Nothing changed in their offer apart from us saving them $5,000 per successful applicant.
The biggest changes right off the bat were:
When we took over they were only running 2 adsets. We started testing 10 audiences right away with the correct structuring.
Four of these audiences were huge winners causing the CPL to go from $18 to $6 almost instantly.
Ask yourself, what would such a reduction mean for you in your business?
In terms of customer acquisition, this was the biggest change we made.
We shifted their campaigns from optimizing and targeting CPL events in their ads manager to CPW events
The Key To Maximizing Ad Spend
Here’s the issue with most businesses.
They crack one ad network and get comfortable.
They try to scale up.
So you should.
But to avoid ad fatigue and scaling too fast, we implement Horizontal Scaling.
That’s where YouTube and TikTok came into the picture.
When scaling, diversification is everything.
You can’t depend on a single ad platform for if you were to lose your ad account, even if it’s just for a few hours, could cost you very dearly.
This client was already advertising on Google, but with far from optimal results.
With Google, their CPL was 3x higher than their Facebook campaigns.
So we did our magic, and our final customer acquisition cost (yes, customer acquisition, not leads) was 30% lower than Facebook!
Since then, we’ve spent $2m on there (33% of total ad spend over the last year).
Here comes the big boom…
The Underdog a.k.a TikTok
A lot of people assume TikTok is for kids and flashy content.
Or trending retail products.
But they forget that TikTok is one of the fastest growing social media platforms with over 800 million active users worldwide.
Now surely they can’t all be kids creating dab videos.
The Road Wasn’t Smooth, But The End Was Blissful
Initially, we faced countless ad rejections.
The good thing is that didn’t cause us to lose our ad account as you might with other networks (cough – FB – cough)
But then, we managed to become a TikTok advertising partner.
They then offered us a special category to advertise under.
And almost instantly, we were able to get their Customer Acquisition Cost to 50% lower than Facebook.
Can you see the power of Horizontal Scaling now?
What To Take From This
Had we just focused on optimizing and scaling Facebook, we’d have missed out on the 30% lower acquisition cost from YouTube
And the 50% lower acquisition cost from TikTok.
We’d have spent $3-4m less in the last 12 months.
We’d have left a lot of money on the table.
It would’ve taken us a lot longer to scale.
Advertising truly is an art when you understand it, but more importantly, it’s not that hard when you’ve been through the wringer.
It’s not something you learn from a course.
It’s something you can only master by doing.
And luckily, we’ve had the opportunity to help countless businesses over the last 5 years and manage over $3m in ad spend every single month.