Our Facebook Ad System Generated Sales of $200,000 in One Month
by Brian Nagele
Yes, thats $200,000 in revenue directly from Facebook Advertising over one month. Above is the screen shot of the August 2015 sales for our client North Shore Beach Club. These are direct results of our Facebook Ads system.
Everything in life is based on a formula. You either have the winning formula or you keep adjusting the ingredients until you get it right. This particular formula took a long time to perfect and now it is a cash cow. Here are the basic ingredients of a quality Facebook marketing formula:
- Have a quality product or service that people will want to buy
- Create a compelling offer
- Make it easy to purchase
- Create a sense of urgency or scarcity
- Use analytics and conversion tracking
- Scale when you see the ROI
- Use retargeting to chase the drop offs
- Most important…learn from the experience and document the process
The Quality Product:
The product was a membership to a private swim club in Philadelphia called North Shore Beach Club. It was a successful business. After 4 years, they sold the business in 2016 for a profit. Full price memberships were $700 for a full time (7 days per week access), and $300 for weekday only membership (Mon-Fri). It was a seasonal business, rent was expensive and they needed enough savings each fall to make it through the winter months.
The Compelling Offer:
The idea was to generate cash flow by selling memberships in advance for the following season before then end of the current season. The swim club season was May into September.
We decided that an August 1st sale for next years memberships made sense. It was set it up to offer the first 100 purchases (of each membership level) with a 50% discount. The limited amount created a sense of scarcity to buy now.
At first the club owners were concerned about “losing” half their potential profits. After an analysis session we discovered they had not sold out memberships in the past years efforts and there was plenty of room for growth. Creating demand up front with a solid purchase base was a motivating factor. As was generating plenty of cash flow at the end of the season. In addition, once people became members, they generated over $500 per member during the season in guest fees and food/beverage sales.
The product had no cost of goods. It was all gross profit because it was a membership. We had a limit of 800 full time memberships (weekends are busy) and week day was virtually unlimited based on lower use and volume Monday through Friday. They agreed to give it a try.
Its important to note that giving something away up front to win a lifetime customer is ok and sometimes the biggest difference in success or failure of a campaign. Too many businesses have weak offers and see weak results for their campaigns.
I added a bonus for people that we not current members. They could buy next year’s membership and get access to the remainder of the current season Aug-Sept. Existing members renewing received a gift card. All this was limited by time frame and quantity as well. here is one of the ads.
We used a combination of post boosting and targeted facebook ads.
We set up a wufoo form embedded into a landing page exclusive for the membership sales. Linked the Facebook Ads campaign directly to this page. The page only contained info about the memberships and was very easy to use. It was a two step process. Step 1 fill out the application form with contact info. Step 2 was payment page to fill in your credit card and pay in full, $350 or $150 (the 50% off price points).
Scarcity & Urgency & Scaling when you see a return:
We advertised only 100 available at these prices and later changed the ads to set a date for expiration. We set a small budget to test it out. What happened was amazing. We set up the campaign hit go and walked away to check on it later. The first hour we had $6000 in sales, so we bumped up the daily limit by 4x to see what happens. Next day we wake up and the authorize.net credit card processing gateway sent us an email with the previous day’s sales numbers, HOLY SHIT! $27,000 in one day of running the facebook ads??? This is insane. Not only that but day 2 was already on pace to meet that same number.
We obviously flew past the 100 limit we originally set, but the client was ok with that. Cash flow was pouring in and we were running at 100% gross profit even with the discount. By day 5 interest was starting to fade, so we activate retargeting for those people that fill out the application or visited the page but did not complete the payment. We advertised that we only had a few left and the price was going to increase after the 6th. Sales skyrocketed again to over $25,000 that day.
We raise the price of the full time memberships from $350 to $400 sales slowed a bit to only $2,000-$6,000 per day (I know that’s still awesome). The month’s end we advertised that prices were increasing again on September 1st. Sales spiked again to close out the month.
Analytics & Conversion tracking:
We used the Facebook pixel to track conversions and create an audience of people that visited the page and did not buy.With the facebook pixel audience I was able to target people that dropped off from buying to reignite their interest to commit.
We were also able to create a new target audience or lookalike audience similar to those that DID purchase the memberships. This helped us reduce costs on cost per acquisition by filtering people who just liked the pretty pool pictures and had no interest/intent to pay for the membership. You MUST set up the pixel on your website, landing & thank you pages.
W spent $11,076.36 to generate over $200,000 in sales. (the sale started on July 31st, but i only was able to screen capture Aug). That’s a 5.5% cost and the reason we turned up the throttle spending to scale the campaigns. The ROI was huge for the business and made things comfortable for the winter months.
What we learned:
Use analytics to get smarter about your marketing.
Don’t be afraid to give away a deal to get new customers. Its the lifetime value of the customer that matters. For example, each membership sold also generates a huge sales number May through September in food and beverage sales. If they was stubborn and only sold at full price, they might not sell out and pack the place all summer.
Create scarcity. People HATE missing out on a deal or opportunity. No one wants to be left out. If they miss the opportunity when you offered the deal, too bad! They will have to pay full price later and here about all the others that only paid a discount for buying early. By the time the spring hits, people were begging to pay full price.
Document your process. Keep a journal of what worked, the timing, the copy, the audience. It pays off next year and you’ll raise your margins a little each time or significantly.
Harvest data and organize it. An email list of previous customers is worth a lot more when you want to run the next sale. Hit them first with a special return customer deal.
June 22, 2017
March 20, 2017