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I Love Marketing - Grand Rapids Message Board › Getting Out of Your Own Way….

Getting Out of Your Own Way….

Dan K.
user 9142574
Group Organizer
Grand Rapids, MI
I hope you are having an awesome Thursday!  I have had a few meetings today with my team and then have my Meetup soon.  Going to be chatting about The Perfect Day - make sure to join us tonight @ Gravity for drinks, dinner and some good conversation about being more control of your day….

Today I wanted to discuss something I have been seeing a lot lately - not only with some of our clients, but also a lot of people that I talk to.  What is it?

It is looking at their ad campaigns with emotion instead of looking at the numbers.  I mentioned it the other day - there is a lot of people that are ‘expecting’ once the Facebook campaigns are up and running that the Facebook Fairy comes in with a ton of cash and starts throwing it at them…haha…

Emotion is not your friend when running ads.  If you let emotion get the best of you - you are going to go crazy.  Why?  Because 80% of your ads are going to bomb (at least).  If you are running with just emotion - that will make anybody go crazy.  Now don’t get me wrong - there is absolutely nothing wrong with emotion (it is totally necessary) - just not when running your ads.



We recently had a client that at the end of 1 month we are at break even on ad spend and he was flipping out that we weren’t making any money!  Now this is one of the most competitive spaces (not only on Facebook, but all over), and being at breakeven on Ad Spend is a perfect place to be in (I know a ton of people that would kill to be in a position like that - and you should be too)  Why?  Because we have acquired a paying customer - that we can go back to over and over and over again!

That metric is Customer Acquisition Cost (CAC for short) is one of the most important metrics to know and watch like a hawk.  If I can acquire a paying customer for say $40 and my widget is $50 (and it cost me $10 to make) - I am at break even.  Now here is where it get’s fun.  If your first year value of a paying customer is over $750 first year on average (you have just paid $40 to get that customer) - look the money that you are making over the lifetime of the customer!

What happens if you can get them to buy more?

The other thing to consider which Scott Oldford talks a lot about is playing the long game and the short game.  The short game is making sure you have revenue coming in (quick sales).  And the long game is lead generation & testing with the idea that you are looking for that to start paying off in the future (6 - 9 months from now).  Just playing the long game can burn through a lot of cash 💰 , so you have to play the short game as well.

Make sense?

So I will get off my soap box and let you ponder on this - are you running on emotion or logic?  Let me know!

Talk Soon,

Dan
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