Do you know the necessary and required pieces to have a profitable return with paid advertising? In this episode, Chris discusses the role automation plays with advertising. Both require a careful, detailed approach that is often overlooked or unknown for success. Get ready to take notes because you’re about to learn how to approach paid advertising the right way.
You’re listening to the All systems go podcast, the show that teaches you everything you need to know to put your business on autopilot. Learn how to deploy automated marketing and sale systems in your business the right way with your host, the professor of automation himself and founder of automation bridge, Chris Davis.
Chris Davis 0:32
Welcome to the All systems go podcast. I’m your host, Chris l. Davis, the founder and chief automation Officer of automation bridge, where we focus on turning digital marketing professionals into automation service providers by teaching them Marketing and Sales Automation. And if you’d like to become one our find out if you should become one, an automation service provider that is we’ve got a new quiz, a brief brief quiz it takes less than two minutes and it will tell you exactly that. You can find that at automationbridge.com/asp if you’re new to the podcast, make sure you listen to this episode in its entirety. So you know the value the the gem of knowledge that you’ll be receiving every Thursday when we release a new episode. At the time of recording. The All systems go podcast is free to subscribe to. And you can find the show on all main podcasting apps like Apple podcasts, Google podcasts, you can even subscribe on YouTube. So once you’ve listened to this episode in its entirety, make sure that you subscribe for those of you who are listeners and just haven’t subscribed yet. For whatever reason. What are you waiting for? Now is the time now is the time. Um, while you’re at it. a five star rating and review is greatly appreciated. It helps vet the All systems go podcast as the podcast to listen to, to subscribe to, to get the exclusive and specialized knowledge on marketing automation. So you can leave a review in any of those podcasting apps or if you would like for us to post a review for you, you can go to automationbridge.com/review. In this episode, I want to talk about the role that automation plays with paid advertising. Both require a careful detailed approach that is often overlooked, or unknown for success. And time and time again, I keep saying entrepreneurs make some critical mistakes. And it all stems from a lack of understanding how the two correlate operate and work with one another. So I want to talk about that I want to discuss that in this episode. And when you think about it, the expectations of advertising is often a misguided one. And for me, the most commonly This is just in my experience. I see entrepreneurs who just they rely on it too early. It’s it’s hoping that they can throw money at their lead generation problems with the expectation that things just work out and the truth is this you can throw money at it but it doesn’t guarantee that it will work and that’s the part that’s the part that throws me in hurts me I should say when I see good entrepreneurs I mean people who really deserve to win and they’re like I need leads and he leads Oh paid ads I mean get some money and pour it in and they are so so so so hoping that it works and I know these people because I used to be that I used to be the one with my back against the wall ready for to throw 1000s of dollars at a problem hoping that it would solve it and the reason why in the truth is it didn’t solve it. It did not until I got a more systematic approach more detailed and a more educated approach. And and here’s why. I’ll be honest with you and for those of you who are paid media experts listening to this, tell me if I’m right or wrong I am serious email, go to the to the website, leave a comment,
Chris Davis 4:31
share it on Facebook and say hey, that he this guy really got it wrong on this one. Because I’ve I’ve been around the block, I’ve been around enough. And truth be told, paid advertising professionals are required. They’re needed. So I’ve had to engage with them on many levels to understand exactly how they operate in order to also understand how to build a system to complement their operation. And to the point where the entrepreneur is just hoping to throw money at the problem with paid advertising, keep the fingers crossed that it works. The reason why it’s not necessarily working because there’s a lot more to it, there’s a lot more that’s involved. In some of you, this podcast is about to save you from, from wasting 1000s of dollars. I know me, my hand is up, I’ve wasted over $20,000 easily within a couple months in advertising. So I’ve got the wounds to share, to show I’m not talking from an aspirational I read in a magazine, this was real deal. And there are certain steps that you have to take in order to become profitable. So the The problem is, most people don’t know, they have no expectation of preparation with approaching a advertising agency or an expert. And I want to break down how, most commonly, you’ll see this work. And most experts, what they do is they require a sizable investment and some profit or rev share while you take care of all of the aspin. So, you know, maybe if you get a deal, they’ll say, hey, look, we’re not going to charge you monthly, but you’re going to need to pay for all the ads. And then once you start making profit, we’re going to take a percentage of that, that’s probably the most common setup, but then you have some that we quite require a monthly fee on top of that, okay, and this has to be consistent, you’re not going to be able to work with an agency that allows you to just start and stop, like, Oh, hey, it’s been three days, it’s not working stop. Because you have to commit to pay to play. Facebook is set up to the point and I’m using Facebook as an example. Of course, you can run paid advertising on other platforms. But Facebook is set up as such that they reward those who pay when they see that you’re paying consistently, you’re always running, they’ll they’ll give that algorithm that nobody knows how it works, they’ll give you preferential treatment in that algorithm, your your reach will start expanding. Right. And and this commitment usually starts on the low end when when we’re saying when I’m telling you, you have to commit to pay to play, this is around the low end of anywhere from five to $7,000 a month. If you don’t have five to $7,000 a month to spend on paid advertising, you’re not going to be able to expect that sizeable return. Okay, this This in itself, for a lot of service based businesses or consultants that I speak with, you know, you’re charging 500, you know, 600 $700 per client, just sorely under charging. And now you can start to see why you haven’t been able to scale, because you can’t capitalize on paid paid advertising with those types of pricing for services that require your time, you just can’t, because you’re going to have to know that it’s going to take anywhere from five to 7000. To get started. Okay. And again, that may or may not close, right? It’s been, there are some agencies that require you to spend a certain amount. And then what they’ll do is they’ll take a percentage of what you spend. So an agency will say, hey, look, in order for us to run your advertising, we’ve got to spend $10,000 a month, and of that $10,000, we get 7%. It’s just part of it, it’s part of it, and then again, they may double up and get some of the profit as well. So advertising is not a cheap sport. It’s just not so many configurations. There are some people that get more creative than others. Some I’ve met some professionals that will put up all of their money. They’ll say, hey, look, you don’t have to pay anything. We’ll pay for the for the ads, we’ll pay for the landing page, we’ll pay for the email follow ups would do all of that. But on the back end, you’re going to give us 50% we’re partners now. Right? You’re going to give us a sizable rev share. So many configurations, guess what? All of them for the most part require money for me.
Chris Davis 9:33
Pretty much all of them require money from you. Unless of course, you know, you learn how to do everything yourself. If you’re into that type of thing. If you’re willing, if you want to learn to do it yourself, just just know you’re committing to become a student. And can you do it? Absolutely. Absolutely. But you need to be connected with the right community. You need to be connected with the right people that can help you And understanding what to tweak, what to measure how each of these platforms work, if we’re, you know, just just the approach to Facebook and YouTube drastically different, because intent is drastically different. So you want to get connected with a mentor or a coach that specializes in the platform that you want to advertise on. And understand that when you put that hat on, to learn advertising, something else is going to take a hit, you’re not going to be able to do something else. Because your time needs to be focused and dedicated to learning this thing and doing it. That’s a fair expectation for those of you that want to don’t want to do it yourself. Absolutely can do it. But But what about those who pay to play and get it right? What do they do differently? What’s their approach? And as much as I’ve already discussed, the approach you should have to paid advertising the expectation, so you don’t start prematurely and wonder why scratching your head is not working. But what let’s look at what the businesses that get it right, how do they get it right? What do they do, there’s three things, there’s three things that I’ve identified that they do. Of course, there’s more everybody, but these are the top three, that I found the most consistent from anybody generating half 1,250,000, consistently half 1,800,000 to 1,000,002, millions, they all do these three things. So the first one is this. They know their audience, they know their audience. And I feel like this is becoming less and less of a gimme. Like for me, as a marketer, you always start with knowing the audience. I love figuring out who my audience is, and doing some market research, talking to my customer testing language on them. as a marketer. I don’t know, I like that stuff. But most people don’t take the time to do the market research. They don’t know the pains of the individuals in the market, as well as the market as a whole. What are people trying? What are the alternatives? What are they really trying to accomplish? Whenever I’m talking to somebody, it’s interesting to hear what they prescribe for themselves, hey, I need to be doing this. And I need to be using that. And I need to be doing this. And when you take the time to step back, say Hey, what are you trying to? What are you trying to? What are you trying to do here again? What are you trying to achieve? And then when they say what they’re trying to achieve, you realize, Oh, that’s not the way. But I don’t get that without doing the research and talking to my customer. Too many people want to just automate their way to success, and eliminate all human touch that is undesirable to them. No, no, talk to your customer. Invite them to call your phone and pick up when they do. Especially if you’re early, if you’re not super clear on who your avatar is, your audience, the pains, the trends, the holes, the opportunities. If you don’t know that, talk to your customer. People love to talk to people who can solve their problems, talk to him. And they have so part of knowing their audience, they have a clearly defined avatar, and targeting messaging to match. I didn’t say avatars. Anytime I’ve seen really successful advertising, and I’m talking about if you had, if somebody gave you a grant, and you needed to make that money work, you’re going to have you’re going to target that one avatar, you’re going to have so many angles for that avatar, so many different ways to say, talk about one product to that avatar that it would work. It will work most people don’t even have an avatar, let alone singularly. But are they willing to focus on one in advertising to convert? Because when things don’t work, it is so easy to create something else or switch and shift. So that’s the first thing successful advertisers do is they know their audience. The second is they have a system.
Chris Davis 14:34
They have a system. Okay. Audience targeting maps directly to segments. So So targeting in a platform is akin to segments in your CRM, okay. And these segments need to be defined so that when you’re targeting those segments, because segments exists within an avatar, right? I can have an avatar of somebody who works nine to five has a family is married, trying to get off their job. And is, is involved in leadership in their community, they take their kids to sports, and their dream is to retire their wife early. And the pain point is that they make just enough to need more, right? That could be an avatar. Now segments within that avatar depends on what stage they’re of life they’re in. Maybe this is a new, you know, you’re 22. And experiencing this, maybe you’re 35, those are two different segments, same avatar. Okay. So that’s what I mean. And for those of you who know, my training, and I’ve gone through my program, they also have learned how to map segments to life cycles. Okay, so the life cycle of a customer journey, and mapping segments and showing that correlation. That’s what I’m talking about. So we’ve got a three layered approach and an avatar that goes to a customer journey, which are lifecycle stages, and within each lifecycle stages, their segments. Let me just pause really quick. And when I’m talking about systems, do you understand what type of system I’m talking about now, I mean, being able to identify exactly where someone is at at any point easily in the system, and having the past prepared. For every segment. every segment, every move, somebody can make, should already have a path prepared. Okay. This is what I mean when I say they have a system. Now, not many people have this, you can be profitable. With advertising without one, you’re just going to pay more for it. That’s all. In fact, everything that I’m telling you on this podcast is for efficiency purposes, I want you to pay the least amount of as possible and make the biggest amount available as what I want you to do. So you could blow everything that I’m saying out the water, if you have big pockets, big deep pockets, because you’re essentially going to pay to learn, you’re just going to keep dumping money in to figure out what’s working. And if your money is that long, if you’ve got that much that many zeros in your bank account, so be it. Many of the SAS companies that I’ve helped, that I’ve worked for and worked with, they’ve had big banks. So yes, they can pay to play unlimited. without even really converting much, you can’t afford that. So you need to have a system. And when we’re talking about systems, you have to understand that paid funnels look different than organic mistake that people make is that there, they may have this organic means it’s organic. A funnel that takes people to read the blog posts, they opt in, then they go register for the webinar, and XYZ, and then they say, Okay, great, I’m just gonna drive traffic to that blog post doesn’t really work like that. It does, it’s not a one to one, it’s not a one to one, sometimes, you may have to optimize that blog post, maybe you got to put an exit intent pop up on there, maybe you have to reformat how it’s written, maybe you have to turn take that whole blog post, and put it on a landing page and maybe an abbreviated version. Right, there are some tweaks that you’re going to have to make, depending on the platform that you’re advertising. If it’s Facebook, these are people with short attention span. So if you got a great article that people are searching for, and reading, that does not mean somebody’s not searching for it is gonna read it. They’re not searching for your stuff, they’re being interrupted. Now flip it to YouTube, where the intent is totally different. You’re running advertising on YouTube, people are actually searching, they’re they’re looking, they’re in the mode of consuming. I want to consume information. Right? So that would look different, both regardless if it’s Facebook or anything, Twitter, you be advertised on anything. The point is, you’re going to have to adjust that funnel to the source of traffic that’s coming through.
Chris Davis 19:36
Okay, then you need a way you need a way to follow up and convert with every new lead that you pay to generate. Right? How you convert them that it the time it takes right to convert that new lead. It depends on the platform and your system. Your system has to account for that. Okay. The time to close. I’ve generated this lead, how long before I close? And how much did I make? And how long can I do this? You know, until I’m profitable, or run out of money either way, right? Because the truth of the matter is this, if you’ve got killer Legion on the front end, you’ve got just man, you’re crushing it. But you don’t have a back end system. You’re You’re still, you’re still hope marketing, you’re putting money into the into the front end Legion with hopes that they stay in there. It’s like the the leaky bucket, the leaky bucket, the bucket with a hole is it doesn’t matter how much water you’re pouring into it, as long as that hole is there, it’s not going to stay is going to empty out. Those leads are going to leak away without a system. The system is what prevents those leaky leads, and further prevents you from from participating in hope marketing. My my desire is that nobody that listens to my podcast would have a degree in hope marketing that you would know without a shadow of a doubt exactly what you’re doing, who you’re targeting. And when when they say yes, where they’re going, and what they’re going through. Okay, there’s a whole this this, let me just say this podcast is very hard for me to record. Because there’s so much strategy involved. There’s so much that I’m leaving out from an automated systems perspective or a marketing automation perspective, right? How do you capture information on a landing page, and then ask for more information on the thank you page without asking for the same information you just asked for. Right in how to make that seamless? Where do I put the webinar registration door? If I’m paying if I’m driving to a webinar? Do I drive them straight to the registration page? Or do I drive them to an opt in and put the registration page on the thank you page? Do I have a low offer a self liquidating offer on the front end to pay for my aspin so that I can put more dollars into it so much? I don’t care the strategy. Just know you need a system. When they say yes, you better have a path for them to go down. Now when we talk about strategy in the system’s oh my goodness, this Don’t get me excited. I this thing will be five hours long, right? But how do I take that information that I captured up front and put them down the fastest path to Yes, for them. For them. The system should adapt should be dynamic to whatever information you’re capturing. So a lot of people don’t know how to capture information that they don’t know how to use it in an intelligent way to automate the paths of the leads that come into the system. This is what it is. Now with a system, there are no leaky leaf,
Chris Davis 23:21
everybody comes in, they have the greatest opportunity to convert as fast as early as possible. Right. So that’s the second thing they have a system. Third is they they keep focusing on their customers, they never stopped focusing on their customers. And that may sound like common sense. Like Of course you focus on your customers. Not in that way. I mean, they never stop marketing to their customer. Right. But the second you start converting customers, your focus should be on your customers. Right each customer, what they do is they inform you more on your avatar and in such helps improve your targeting to find more just like them, if you continue to talk to your audience, right? Do you see why I say focus on the customers because we haven’t even talked about the second aspect is focusing on your customer can extend the lifetime customer value and offset your ad spin or your cost to acquire a Li your CAC. Okay, if I’m spending $2,000 to generate a customer that’s paying me 15 $100 upfront, I’m net negative 500. Right It took me $500 out of my pocket to get this customer but what if in the duration of the next three months, that customer pays me 15 $100 every month. That now means that I made 40 $500 off of a 2000 Wasn’t dollar aspin, I’m not negative 500 I’m positive a couple 1000. Right? Right and positive 2500 honestly, you see that, but that’s focusing on the customer. When I say focus on a customer, extend the lifetime customer value, lower your CAC, or, as you say, offset your CAC, your cost to acquire a customer, that does not mean just throw offers in front of your customer. That is not what I’m saying. I’m saying take the time and create a strategic, a strategic means of crafting offers, and putting them in front of your customers in a way that makes sense and doesn’t disrupt transformation. Okay, that’s your job. You don’t get to just create stuff and say, Hey, since you bought this by that you can do that at the risk of burning out your people. But you want to do it in a way that’s complimentary to the transformation that you promised. And this is really more so for service base for product base is totally different. For product base, we have subscriptions, we have like products cross selling upselling, right? Hey, you bought this. So you may like this. It’s so hard. You see why so hard for me to record a podcast like this, because I’ve done so much I’ve seen so much. And the second I say one thing for one, I’m thinking about the other 510 other possibilities, right? But you get you understand what I’m saying, it doesn’t matter if a service based product base, I dollar, low ticket, whatever the case is, you need to stay focused on your customer, and continue to deliver value if you’re going to spend to get the customer, you need to get as much to the customer. So you can get as much from the customer as possible. Okay, and we have no shame in saying that. We want the customer to keep paying us, especially if we’re delivering value. This is the second component of your system, the second most important component of your system. The first is nurturing new leads the second is nurturing customers into repeat customers. And guess Guess how long you do that? forever? You never stop? What will be the reason to stop it. Let me ask you this. How deep does your system go? How long can you get people to continue to pay you? What does that system look like? Just ongoing payments? What does it look like for you? What’s what could it look like for you? What should it look like for you? All right. And this is all relative, it’s all relative to how large you want to go and how much you’re willing to pay to play all of that, right. But you have to understand that done correctly, you will lower your reliance on ads for profitability and transition, it transitioned that reliance on ads for scaling. And that’s why I said it’s optional is or I should say it’s relative, because some people want to scale to 10 million.
Chris Davis 28:16
Best believe they’re going to be spending more than $10,000 a month on advertising. Right? Maybe somebody else wants to scale to 350,000. Right? totally different. But the key is, I don’t ever me personally, you know, paid advertisers who love this stuff. Maybe they think differently. But I would rather not have to rely on ads as my lifeline. I would like to leverage them for scale. So if the advertiser doesn’t bring in another dollar, I’ve got a system in place. That’s, that’s converting organic leads. And it’s taking my customers and turning them into repeat buyers time and time again, that if something happened, Facebook broke, YouTube goes down, Twitter stops, wherever you can advertise, you can’t advertise anymore. I’m still making money, and I’m still profitable. That’s the goal for advertising everybody. That’s your insurance is that you build a system smart enough to keep you profitable without the ad spin the same system that leveraged the ad spend. Because again, now, I’ve got profitability locked in and I can really just focus on scaling. This is a different conversation. Some of you are no you’re just trying to get your first 20 $500 a month locked in. I get it I get it. Some of you, you know, maybe you’re at 20 20k a month, you’ve got a team that 20k don’t feel like 20k I’ve met entrepreneurs that made a million in a in a calendar year and did not feel anywhere near a millionaire anywhere near it, mainly due to the cost of AV the ongoing costs. Cost of advertising, and not having a back end system that truly optimizes the customer journey. Okay, automation and ads can go hand in hand. In fact, they do. And I always recommend I said it earlier, I always recommend, start, if you’re just getting started in business. And you don’t have money like that, even if you did have money like that, I always like to start with some organic means as much and convert doing that as much as possible before jumping in. Now some of you may just say, hey, look, I want to just start in pay, you know, $10 a day, I’m kind of savvy, I just want to kind of test the waters. So be it perfectly fine. But what I’m saying is most people are not that savvy when it comes to paid advertising, to be able to pay to validate an idea. So with that, use your organic efforts, be featured on somebody’s podcast, write content for somebody, do it do a live training in someone else’s community. Right? There’s so many organic ways that you can really start to test out your business, your messaging, all of that, that cost nothing but your time and strategic effort. So automation ads, they do, it’s not a canned, they do go hand in hand, you’ve got to have an automated system if you’re going to run ads, because your ad, profitability relies on it. Okay? When they go hand in hand like that, you’ve got a systematic way of generating leads through advertising. And then a systematic way of of converting those leads, when they do scale is inevitable. Scale is a matter of when, when they don’t watch this, watch this, when they don’t go hand in hand, he just can’t seem to get the ads, right? Okay, I want to turn that off, when they don’t go hand in hand, guess what, you can still work the system. That system that you’re building, through advertising is still going to work. Now here’s the kicker, a funnel that you’ve created for paid advertising will more more is more apt to work for organic traffic or marketing efforts, then organic marketing efforts would work for paid advertising. So that means all in all, you never lose with the system. Whether you’re paying for advertising or not. It’s It’s the ultimate can’t lose. Because when those ads go off, that system stays on and what the system needs, what it’s looking for, is just another source. Feed me, are you feeding me Facebook leads, I don’t care where they come from LinkedIn leads, okay, feed me. Right. And by work to cystamine, pay attention to it, tweak it, optimize it.
Chris Davis 33:08
Right. automated systems, don’t run ads. Without one, my friends. Please do not run advertising. Without an automated system. to back you up. Offset your cost to acquire customer extend lifetime customer value, move you from profitability to scale move you from relying on ads to live to eating comfortably off your profit generated from the same customers that the ads brought in. Okay, now, this was a comprehensive in 30 minutes. I my task was to break down advertising and automation. I hope I did that. I hope I gave you the proper perspective. So you know what it takes, and you know what’s required to be profitable. You have a system in place paid advertisers will love you paid advertising professionals do not enjoy writing email, they do not enjoy setting up your CRM, but they love it when you’ve done it. We’d love it when you’ve done it. Okay, so hopefully you’ve learned a lot and some of you hopefully I’ve talked off the edge of jumping in deep with pay media with your fingers crossed hoping that that water that you’re diving into is water it’s it’s late at night, right? It looks like water may be tar. We don’t want that. Don’t dive in the tar. Come on now. Right? Hopefully this opened your eyes and let you know okay, I was about to do this. Let me back up. Get my stuff in order. What should you do if you are about to jump off? thinking you’re getting into the water? What should you do? I just saved you. Well, you should focus on getting a system in place period. 100% focus on getting a system in place. Of course, I trained digital marketers on how to do this. So I’ve got resources to do so. But if you want to do it yourself, I’ve got proprietary curriculum that shows you that. All right. But asked me this who, who needed to hear this Who do you know, is spending money on advertising. And every time you you look at their status, it just doesn’t seem to change. Right? If anything, they’re, they’re more frustrated than they are excited, make sure you share this episode with them. And if you found value in today’s episode, make sure that you are subscribed. If you’re a new listener, and this was your first episode, now’s the time to subscribe, and leave a five star rating and review while you’re doing it. Here at automation bridge, we’re dedicated to training digital marketing professionals to become automation service providers. We do this by teaching them the skills of Marketing and Sales Automation, so that they can more accurately and proficiently take your business strategy, your marketing strategy, and combine it with the right technology to build a automated system specific to your business need. Okay, that’s what automation service provider does. If you would like to become one, or determine or maybe you’re unsure, you’re like, what I make a good one. We’ve got a quiz for you. Not two minutes will help you decide. It will also help you decide what path to go on. By the way, if you’re like, hey, let me just take it and oh, I’m not I’m not a good fit. But oh look, I should do this next. That’s that automationbridge.com/ASP. We’ve made it easy for you to get access to everything though, the resource I just mentioned, as well as everything else. By visiting Allsystemsgopodcast.com there’s one URL to remember, you’re like, man, I can’t remember what he said, Allsystemsgopodcast.com. And that gets you access to the latest episodes, access to our amplify automation package that puts automated marketing and sales systems in your business over the next six months. Okay, so with systems we’ve talked about it today, you can get access to our free Facebook group. You can request our refer someone to be a guest for the podcast, and any resource or training mentioned on the podcast, one URL to remember get you access to it. And that’s allsystemsgopodcast.com Thank you for taking the time to listen to this episode. And until next time, I see you online. automate responsibly, my friends
- [2:17] The most common mistake entrepreneurs make with paid advertising
- [4:13] Why throwing money at ads doesn’t guarantee results
- [10:40] What businesses who have success with ads do differently than those who don’t
- [11:08] The first step to successfully executing paid ads
- [14:34] How the system you have in place determines your paid ad conversions
- [19:36] Why backend marketing is crucial for converting the new leads that you pay to generate
- [23:24] The importance of continuously focusing on your customers
- [24:13] How to lower your cost to acquire customers (CAC)
- [30:14] What you should do before jumping into paid advertising
- [33:08] The one thing you should never run ads without
- [35:50] How to become an Automation Service Provider™
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About the Show
On the show, Chris reveals all of his automated marketing strategies he has learned from working in fast growing marketing technology startups so you can put your business on autopilot quickly and without error.
Discover how to deploy automated marketing, sales, and delivery systems to scale your business without working long hours to do so.
Chris L. Davis
Chris is an Electrical Engineer turned entrepreneur who is the Founder of Automation Bridge, an international speaker and facilitator, and startup consultant