Key mistakes studios make with their Facebook targetting
Feb 21, 2018
Facebook is possibly the most advanced advertising platform on the planet, with thousands of ad variations possible for your ad design, audience and delivery channel.
At my peak, I was spending $30,000 per day on Facebook Ads - so you can immagine how important it was for me to understand every variable and how to get the best return on investment.
I've written and delivered a 30 module social media marketing course, spoken at a number of growth-marketing events, and am immersed in this world every day. Despite this, I still learn new things daily and constantly struggle to ensure everything I do is performing as it should. If it's that hard for me to stay ahead of the pack, then I can only imagine the struggles of a studio-owner trying to do everything else as well.
Why is Ad optimisation important?
Let's say you are following a fairly typical studio FB budget of $10/day ($300/month). If the Ad you create is getting a cost per click of $1.80, and you can reduce the cost per click to $0.90c, then it's reasonable to see how you've just doubled the number of new members coming into your studio from your ads each month without spending a cent more.
What I like to look for in sales funnel optimisation is looking at every variable, and seeing which changes will have the greatest improvement. This is the first step of what we call 'growth-hacking'.
Quite often, it's not the parts that you think. Many studio owners I speak to initially think the way to get more members is to be better at 'selling'. They've possibly paid good $$$ to a 'sales guru' that's taught them that 'selling after their first session' is the best way to get more members into the studio. While sales performance is definently part of the business growth strategy, it probably has less impact than you would think. Here's why.
Example 1 (common mistake): Invest time in boosting sales performance.
Let's see what happens if we improve the sales conversion from new trialers from 30% up to 50% by introducing 'the hard sell'.
Ad Spend: $1,000
Cost Per Click: $2 (resulting in 500 clicks)
Clicks that register for a trial: 2% (resulting in 10 leads)
Trialers that attend a trial: 80% (resulting in 8 trialers)
Old Conversion Rate: 30% = 2.4 New Members
New Conversion Rate: 50% = 4 New Members
Example 2 (much better result): Invest time in a better converting ad.
Let's see what happens if we use better targetting to reduce the cost per click from $2 to $1, and improve the click to trial registration rate from 2% to 3%
Ad Spend: $1,000
Cost Per Click: $1 (resulting in 1000 clicks)
Clicks that register for a trial: 3% (resulting in 30 leads)
Trialers that attend a trial: 80% (resulting in 24 trialers)
Conversion rate: 30% = 7.2 New Members
As you can see, improving your 'sales team' in this example will move you from 2.4 members to 4 members for the same ad spend (a 66% improvement), but improving your ad targetting will move you from 2.4 new members to 7.2 new members (a 300% improvement).
At Functional Dave Consulting, we've put together a calculator tool so you can run your own simulations.
So what are the mistakes that studios are making?
Mistake # 1 - using only location and interest based targetting.
We've all been there, you go into Ads Manager, put a 5km radius around your studio, and start selecting 'interests' that you think your target market would be interested in, maybe 'health and fitness?'. Male or Female? Age?
The reality is that there are much better ways to target. You don't need to make assumptions anymore. Facebook has so much data on their users (and your existing clients), that you can use Facebooks predictive modelling and machine learning to target exactly the right kind of user. All of our Ads use no interest based targetting at all.
Mistake # 2 - Advertising to existing members
Fitness members are loyal AF! If they see anything with your name on it, they're going to click it. This is bad for your Advertising. All of those numbers we use in our calculator get thrown out the window if you're paying to show your ad to existing members. Your cost per click will decrease significantly, but artifically. Your conversion rate from click to trial will decrease horribly, as existing members don't need a trial session.
An extreme example: I took over marketing from a 'consultant' who manages administration and marketing for a large number of fitness studios. The #1 Ad being used was a group photo, being marketed to existing members. Why did they use this ad? Probably because they thought it was their best converting (lowest cost per click). The reality is that as soon as I switched out this photo to dynamic creative, then fixed the audience to a weighted lookalike of highest spending members excluding current members (more on this below), I was able to not only beat there existing cost per click but also improve their conversion rate into trialers such that in the very next month they had more new trialers in studio than they did in their opening week.
Mistake # 3 - Boosting posts
Don't ever touch the 'Boost Post' button in Facebook.
It seems so innocent, you click the button, choose your audience, budget and campaign duration, then click "Boost."
What you might not know is that Facebook just created a new ad campaign in your ad account with the objective of "Page Post Engagement". Which is not the right objective for any studio.
Facebook Ads can have a number of 'objectives'. The best one is 'Website Conversions', this is where you have the FB tracking pixel on your website, and have a defined event that means someone has signed up. Once someone signs up, Facebook automatically finds people similar to that person and markets to them. The second best one for a studio is 'Website Clicks', this is where a conversion is seen as someone clicking through to register for a trial. Facebook then trys to find more people similar to those that have already clicked, resulting in a lower cost per click.
Page Post Engagement is possibly the worst conversion objective, it tells Facebook to only show your Ad to people who are likely to click 'like' or react to a post. The problem is, most in the target market are well educated, above average earning professionals who wouldn't dream of clicking 'like' to some random ad that just popped up on their ad feed. There is a segment of Facebook users that will 'like anything', and Facebook knows these people well and will just show your Ads to them. While the above may sound anecdotal, we've proven it time and time again.
Example: Looking through an Ad account for a studio I recently took over.
Boosted Post: $52
178 Post Engagements (mostly likes) = $0.29 per Post Engagement (Ad optimised for this)
2 Clicks = $26 per click (To think they were paying a professional for this?)
Mistake # 4 - Getting the budget wrong
If your budget is too low, you miss great opportunities. If your budget is too high, you spend more per click than you need to.
The way Facebook ads work is called an auction. Every single Facebook users news feed is for sale. Let's say you fit within the target markets as defined by three different advertisers. Facebook has one spot available on your Facebook news feed right now to show you an Ad. Facebook will then start a bidding was between the three advertisers looking to show you their ad, the ad with the highest bid, wins.
Unless you choose a manual bid, Facebook will create your bids for you automatically, with the goal to use 100% of your set advertising budget in the allocated time. This means that if you double your budget, you won't double your reach - Facebook will increase your bid, meaning your ad is shown to more competitive (more expensive) ad slots.
This means that there is a sliding scale. The more you spend, the higher your ad cost, the higher your cost per click.
This makes Ad budget one of the most challenging juggling acts in marketing. You need to understand exactly what an impression or click is worth to you, based on your conversion rates. You need to know based on the size of your audience, what you want to set as your max cost per click.
Below, I will show you exactly what I do to make sure you get the budget exactly right.
Mistake # 5 - Ad frequency, and Ad optimisation
Have you been displaying the same ad this whole time? Have a look at your 'Ad Frequency' metric - this is the number of times the same people have seen your ad. If you're up around the 5 mark, it means the Ad has been seen on average 5 times by every single person in your defined audience. It's time for a change.
There are many elements to an ad, not just the image. You've also got the title, the body, the link, and the call to action button. Each element can be tested to see what is going to increase your click-through rate, but even more importantly a combination of elements may improve or reduce conversion. This is an advanced concept in data-science called discreet choice modelling - seeing which combination of elements provides the best result (eg. Use the combination of title 1 with image 3 and call to action 2).
The ideal approach
This is the exact approach we use when managing the social media advertising for a client.
Step 1: Start with a weighted lookalike audience of your best customers
Using the Mindbody 'big spenders' report, we generate a list of your customers weighted by who has spent the most. Facebook then generates a lookalike audience of users than best match your top spenders, so you are targetting users most likely to become long term clients
Step 2: Exclude current members
We remove existing clients from the marketing list, so that we are only presenting your offer to new clients.
Step 3: Define the location
We use a custom map marker and set a small targetted radius around your studio
Step 4: Create initial ad variants
Using dynamic creative , create over 500 ad variations using a discreet choice modelling to determine the best performing ad combinations for your clientbase
Step 5: Fix the budget
Based on other variables for your organisation, determine the maximum we want to spend per click or conversion. Using the custom bid tool, we ensure that the average cost per click does not exceed this - we then set an unlimited budget - If the ads are converting into new members, why would you set a cap? An unlimited budget, with a capped cost per conversion means that you will get exactly the maximum number of new trialers that the Facebook platform can deliver.
Want us to do it for you?
We have two commercial models for helping studios with their advertising.
Option 1: FB Ad Management
We use your ad account, to do exactly what we've described above and more - helping you get the lowest cost per lead through your existing page. Simply pay for the Facebook Ads, and a small management fee.
Option 2: Join the beta program for trialsession.com
We put our money where our mouth is, and market trial memberships on your behalf. We pay 100% of the advertising costs, and you only pay us a small commission if the trialer decides to take out a membership. This gives you $0 advertising cost and a fixed cost per new member - very easy for budgeting!
Hi I'm Dave Zanker - A business, marketing and tech leader with a passion for all things fitness.
For the past 10 years I have been a growth marketing specialist, generating over $50M revenue across multiple consumer marketing sectors.
Two years ago my F45 journey began as a member of F45 Southbank. I attended 75x F45 sessions over the 8 week challenge period, droppping 11.7kg and bringing my bodyfat % down from 21.1% to 11.7%. I also won a sweet holiday to Thailand in the process.
It was at this point that I decided to make a change in my career - and build a career in the fitness industry.
As a hobby, I now work as a trainer at F45 Hoppers Crossing and F45 Werribee under the alias of 'Functional Dave'. I love being able to genuinely have a positive influence in people's lives and nothing has been more rewarding than having a challenge winner shake my hand and thank me for changing their life. I'm sure you've had the same happen to you and it's what keeps you getting out of bed at 4am each morning.
Unfortunately, as a trainer I only have around 6 months of experience (and around 400 F45 sessions under my belt as a member!), but as a marketer - I've been recognised with numerous awards as one of the top in this country, and often speak at growth-marketing events.
Based on consultation with a large number of studios, I've obsessed over the numbers such as trial conversion rate, cost per lead, cost per click, optimal delivery time, optimal ad combination and ad spend optimisation. I've taken a data-science approach to identify the pefect formula to guarantee to bring new members into your studio for trial sessions at no upfront cost to you, and in a away that as a studio owner you wear absolutely no risk.