Okay, let’s just be honest here…there’s no shortage of options and platforms when it comes to advertising your business! It’s an absolute minefield!
It’s no suprise that most businesses end up actually losing money from their advertising efforts.
Quite frankly, there’s SO MUCH information out there, yet nobody talks about the fundamental principles that make it all work! it can almost feel a bit like this…
Fear not my friends, I want to hand you the keys to the kingdom.
My aim with this guide is to break down everything you need to know on a strategic level to start advertising your business profitably!
I won’t be going into specific tactics or instructions for each platform. This is more to give you a complete overview of how you can get the most bang for your buck when it comes to advertising online and be sure you’re spending your precious marketing budget wisely!
(Oh, and there’s a lot of information here so you might want to bookmark this page so you can come back to it!)
So grab yourself a cuppa and let’s get into it…
First off isn’t the most exciting, but it’s absolutely necessary when it comes to advertising profitably…
Understanding Your Key Business Metrics
Before you start any advertising campaign, it’s extremely important to understand your average Lifetime Customer Value (LCV) and your Cost Per Acquisition (CPA) which is your cost to acquire a new customer.
This will let you know how much you can profitably afford to spend to acquire a new customer.
If you already know this, feel free to skip past this section but too many businesses jump into paid ads without factoring this in and end up making huge losses because they simply don’t know how much is too much!
Your lifetime customer value is effectively how much an average customer would spend with you over the course of a year. In an ideal siutation you’d want to subtract your CPA from your LCV to get a true picture of what that customer is worth but let’s keep it simple for now as you may not have this yet.
You can use this simple formula to give you a better idea:
'It's worth noting there are several highly effective ways to increase your LCV, but we'll cover that in another article'
Let’s say you run yoga classes and your average student comes to 9 classes a year at £50 per class, that customer would have an LCV of £450 a year.
Therefore, it’s fair to assume you can afford to spend anything below that amount on ads to acquire one customer profitably.
Although in reality, you’ll obviously want to work on getting that much lower!
The next thing you want to work out is your cost per acquisition (CPA), which is effectively just how much it is actually costing you to acquire a new customer.
This will include any associated marketing/sales cost involved in the process of acquiring one new customer.
If that sounds almost impossible to track, it’s probably because you haven’t had systems in place to monitor it before, and this is where online advertising can be a huge help.
Not only can most advertising platforms track all of your your key metrics automatically, but Google, for example also allows you to set a target CPA to aim for:
The Stages Of The Sales Funnel (Or Buyer Journey)
The next most important thing to factor in and be aware of when running a marketing campaign is where your customer is in the sales funnel and most importantly, which stages of the funnel you’re looking to target.
There are multiple different versions of the sales funnel or customer journey, but it’s typically broken into three sections, top middle and bottom.
It’s said that only 3% of potential customers in any marketing will ever be ready/looking to buy RIGHT NOW (bottom of the funnel).
The opportunity lies in the fact that most brands don’t even bother reaching that remaining 97% in the upper areas of the funnel so they end up in a sea of competition and living in a cycle of feast and famine.
As an example here, let’s say somebody has back pain, but they don’t know what the cause is and haven’t seen a doctor yet.
This is an example of a customer who would be at the top of the funnel.
If you’re targeting these people, you’ll want to focus on educating them, maybe offering them a free guide to the most common causes of back pain or some free exercises to reduce the pain.
Middle of the funnel might be when they’ve spoken to their GP or chiropractor and been told they have a slipped disk and there are several options. This is where they become solution aware and you’d now want be educating them on how your product works and can help.
Bottom of the funnel is where they’ve now done their research, so are now also product aware and ready to buy!
For this reason, the bottom of the funnel is where most companies will spend their ad budget.
The only downside to that is it’s often the most competitive space!
There are definitely still quick-wins to be had which we’ll explore this shortly, but before we do, there’s one more important ingredient missing…
Understanding Your Audience
So now that you’re aware of the different stages of the buyer journey, it’s time to ask… who is that buyer??
What are their fears, doubts and concerns and what are they REALLY looking to achieve?
Knowing and understanding your customer avatar is a critical element of any successful marketing campaign. The most effective marketing always aims to go DEEP, not WIDE.
In other words, each campaign should REALLY speak to one core audience in a powerful way.
When you try to spread the net wider, the message will lose it’s punch and your results will take a dive.
Now don’t worry! I’m not saying you can only have one customer avatar.
In fact, most businesses do have several customer avatars and that’s absolutely fine.
But it’s important that you separate these into different campaigns, otherwise your messaging will feel generic and miss the mark!
Check out this example below from a company targeting “workouts for busy moms”
The problem with this ad is there is absolutely no reference to being a mum or being busy!
As a result, the person reading this will likely feel like they’re not understood.
If I was a busy mum and there was another ad below this which said something like:
Calling All Mums | Get Healthy & Fit In Just 20 Minutes A Day!
I know which one I’d be clicking on!
Take some time before you jump into paid advertising to really think about how this could look for your audience and also get very clear on who your perfect customer is.
Not only will this help you get clear on your messaging, but it will give you a better idea of where they spend their time online.
For example, what social media platforms would they likely be using or what industry publications/blogs could they be reading?
If you haven’t already done so, be sure to check out our article on how to create a customer avatar which goes much deeper into this. We’ve also provided some free worksheets to help you really get clarity around this!
Right… now that you’re clear on your costs, the funnel stages, and your customer, we’re going to take a look at how you can start to start putting all this to work!
Finding The Quick Wins With Google Ads
By now you’re probably itching to just get stuck in and get to the good stuff right?
Don’t worry, I’ve got you covered! We’re going to start by targeting those quick-wins at the bottom of the funnel and explore some of the best platforms for reaching them!
Now bear in mind, you could be selling anything here, from a new software product to a yoga class, or maybe even a healthcare supplement…
But remember, at this stage of the funnel, these are going to be the people who have their credit card out and are ready to make a purchase…
So let’s dive straight into one of the best platforms for doing this…
The reason Google is so powerful for targeting bottom of the funnel is because you can show ads based on what people are actually searching for by targeting specific keywords.
Now I want you to think of this in relation to YOUR product or service.
Let’s just say for example, I was looking for a productivity app.
I haven’t really done much research yet, but I know something could probably help me be more productive (top of the funnel).
I might type in something like “productivity software reviews” or “productivity software”
Typically this will be a longer sales cycle as I’m not likely going to buy anything right now.
That’s not what we want if we’re looking for people who are ready to buy right now.
We need to find the keywords that show that this buyer has an intent to make a purchase so you know they might be saying something like “best deal on productivity software” or even searching a specific brand name.
If you can find those keywords within your industry that really show that someone is ready to buy, you’re typically going to get much higher conversion to sale from the first click.
Now typically you’ll pay more for a click to these keywords because a lot of people are bidding against them on Google because they know that’s where the conversions are!
So do your research beforehand on a tool like Ubersuggest, which will shows you the average CPC (cost-per-click) of a keyword and the overall competitiveness.
It’s also important to make sure the website or landing page that you’re sending customers to is actually going to convert visitors to sales!
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YouTube B-Roll Ads
YouTube is obviously owned by Google and it runs on the Google Ads platform but it’s seriously underutilized at the moment.
YouTube B-Roll Ads can be another extremely powerful platform when it comes to targeting that bottom of the funnel consumer.
One of the great things you’ve got on YouTube is that you can target specific video searches or even just their recent Google search history.
So let’s say, you’re an online personal trainer or coach looking to target busy entrepreneurs who want to get fit or start working out but don’t have time to go the gym.
There’s a good chance they might be looking up home workouts on YouTube.
This could be a great place to run a video ad for your new online training course or app and speak to that exact audience.
Here’s an example of a nutritional supplement company targeting beginner exercisers (Is that even a word??). Anyway, It’s a really really great example of targeting the right audience at the right time, thus increasing your chances to convert them to a sale!
Now this isn’t to say that you can’t target middle or top of the funnel consumers with Google Ads, because you absolutely can!
It just takes a different approach and that’s what we’re going to come onto next.
The HUGE Missed Opportunity With Advertising
This upper area of the funnel is where you can gain a HUGE advantage, IF you’re willing to be patient and play a longer game…
Again, the people at the top or middle of the funnel, often don’t realise just how bad their problem is yet.
You know those moments when you accidentally cut yourself…you realise you’ve just cut yourself, it feels uncomfortable, but it only hurts when you look down and see a gaping hole or tonnes of blood…
Remember, your job at this stage isn’t to sell the bandage, as they likely don’t even know it’s bleeding yet!
Your job right now is to simply relate to them on what they’re CURRENTLY going through, and educate them around the discomfort they’re experiencing.
If they sense you’re trying to sell them something at this stage, they’re probably going to run!
Now this is where you would use something like a lead magnet (if you don’t know what a lead magnet is, be sure to check out our article on lead magnets)
So let’s look at an example here…
Let’s just say, I’m unhappy with my current home and I’m considering buying a new one.
However, I don’t yet want to be pitched by real estate agents so I’d rather just do my research.
This is where offering a lead magnet like “5 things you NEED to know before buying a new home” can really help to give value to your audience and bring them into your marketing funnel.
Here’s a great example from Premier Estate Agents with a lead magnet aimed specifically at people thinking about renting out their property:
(Again, think here about how this could look for YOUR business)
THIS is where that golden 97% figure comes in because like I said earlier, it’s estimated that only 3% of your entire customer base will be ready to buy at any one time.
But because most of your competition are so fixated on finding that 3%, you’ll find yourself deep in shark infested waters…
You’re going to be thrown around, scrutinised, squeezed on price and treated as a commodity because you’re just another shark in a sea of sharks…
However, when you get to that 97% EARLY, before they fall into the 3% bracket, you have the opportunity to build trust and become seen as a trusted authority in your industry.
As a result, and if you’ve done a good job at building that relationship (ideally through something like a lead nurture campaign and automated email follow ups) they won’t even feel the NEED to shop around as they already know, like and trust you!
Powerful stuff right!?
Even better, the money you DO spend on ads to acquire that lead will be cheaper, because the competition is lower!
But it goes without saying here, for new businesses who are limited on cashflow, it’s important that you have a mix of both the quick wins (bottom of funnel), whilst still building out that long-term pipeline (top of funnel).
But over time, as you scale up, you’re going to have a HUGE advantage above anybody else in your space, because your leads are sold into YOU and your business, not just what you do.
Now moving onto the social media platforms.
This is where things can really get interesting!
Reaching The One’s That Got Away…
Facebook & Instagram Ads
Where platforms like Facebook and Instagram can become extremely powerful, is through the use of what’s called re-targeting.
It’s worth noting here, this can be done on most platforms, but for context, we’ll stick with social here.
So let’s say, I’ve visited your website, or clicked on your ad, but I didn’t become a lead or buy from you.
I’ve effectively expressed an interest in what you have to offer, but for whatever reason, I wasn’t ready to buy or sign up.
With re-targeting you have the ability to re-target those people specifically, through the use of a pixel.
A pixel is a small piece of code you put on your website, which places cookies (not the yummy crumbly kind I’m afraid) on your visitors PC and allows you to run ads to them across a number of other platforms.
This can help with a number of things:
- Building credibility
- Making additional offers to close the sale
- Keeping you or your company front of mind
- And ultimately, leading to more leads and sales
Here’s a couple of examples.
An e-commerce store could re-target visitors with a FREE shipping offer or exclusive discount code.
A gym could offer a FREE personal training session if customers sign up for their trial membership today (gives people a reason to act now!).
A software company could re-target visitors who didn’t purchase, with testimonial videos of their product for social proof.
Sometimes even throwing a good old bit of scarcity into the mix with a timed offer can work wonders:
The possibilities are endless here and you can have some real fun and get creative!
Hell…maybe even just let them know how heartbroken you are they left without buying! I guarantee you’ll catch their attention 😉
Re-targeting can also be done across Google’s display network which includes millions of industry specific websites, apps, blogs and other companies that allow ad placement.
**This isn’t to say that Facebook or Instagram can’t be used to target cold traffic too (cold traffic is simply people who haven’t encountered or expressed an interest in your brand before)
But if you do, it’s really important that you’re offering something for free initially.
It’s much more difficult to convert cold traffic into a sale initially through something like Facebook.
Mainly just because of the context – People generally don’t go on Facebook with the intention of buying something.
You’re effectively interrupting their time catching up with friends and family, stalking ex’s or whatever it is they’re up to…
Whereas with something like keyword targeting on Google, you can specifically target people who are searching for that specific thing with the intent to make a purchase or at least an enquiry.
So unless you’re an extremely talented copywriter or have a talented team of creatives, you’re best off avoiding this approach, especially if you’re new to ads.
Additional Underutilised Ad Platforms To Be Aware Of
One massively underutilised platform right now, especially in the B2B world right now is LinkedIn!
In fact, LinkedIn has the best organic reach potential of any other platform so it can actually be a great place to reach your audience, even without paid ads (check out our LinkedIn Training video here).
But the best thing about running ads on the LinkedIn platform, is that you’re able to target people with specific job titles.
Whether you’re selling to Freelancers, CEOs of software companies, HR managers, or even just specific industries, the possibilities are literally endless.
The cost you pay per click is going to be substantially higher on LinkedIn but the potential returns you can get from them can be phenomenal because you can really speak to a particular audience.
Just make sure again, that you understand your lifetime customer value when deciding on whether to advertise on LinkedIn. Generally, B2B sales can be worth much more than B2C, so you’ll have to weigh this up accordingly.
Now we’re getting into super ninja territory here.
Spotify’s Ad platform is still in its infancy but the potential here is huge for certain industries.
Their ad platform gives you the opportunity to target users based on a playlist they’re listening to.
Spotify break these down into moods or even activities. For example you have breakup playlists, cooking playlists, holiday preparation playlists, exercise playlists and the list goes on…
Are the cogs whirring yet?? 😉
There is huge potential here to run highly targeted ad campaigns entirely based on the context and mood of the listener.
As a society we’ve become so busy and fixated on convenience, which is why all of the major brands are shifting towards voice technologies like Amazon’s Alexa.
It’s the same reasons podcast listeners are rising year on year.
We simply want to be able to consume content whilst we’re on the move, so audio ads will likely become a huge area going forward.
Right now Spotify Ads can be extremely expensive with a high minimum spend but it’s definitely something to be aware of!
We’ll be regularly adding to this guide so be sure to keep it bookmarked, but hopefully by now, you’ve got a much better understanding and context behind the online advertising landscape!
If you’d like help in creating a customised strategy for your business, make sure you claim your free marketing review today.
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