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When to stop Facebook Ad? Why do Ads stop being effective when only a small percentage of an audience has seen it?

Tourmaline

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When a Facebook Ad was getting good traffic and conversions, and then keeps getting traffic but no more conversions, after how long should you typically pull the plug on it?

I understand that Ads only are successful for so long. I have an ad that had about a 5% CTR and converted for about a month, but for the last 10 days I've gotten no more sales.

Which is lame as that's eating profit!

I expected this to happen, but much later on. The audience I'm target is around 1 million, and the ad has only been seen by about 5000. I expected many more people would see the ad before it stopped being effective. Is what determines this how Pixel targets the people most likely to buy first? Then the rest are basically not likely to buy?

I'm pretty new to this and eager to learn, I appreciate any insight!

I'm also looking for a consultant btw, feel free to start a conversation with me if it's something you do!
 

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Walter.LV

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When a Facebook Ad was getting good traffic and conversions, and then keeps getting traffic but no more conversions, after how long should you typically pull the plug on it?

I understand that Ads only are successful for so long. I have an ad that had about a 5% CTR and converted for about a month, but for the last 10 days I've gotten no more sales.

Which is lame as that's eating profit!

I expected this to happen, but much later on. The audience I'm target is around 1 million, and the ad has only been seen by about 5000. I expected many more people would see the ad before it stopped being effective. Is what determines this how Pixel targets the people most likely to buy first? Then the rest are basically not likely to buy?

I'm pretty new to this and eager to learn, I appreciate any insight!

I'm also looking for a consultant btw, feel free to start a conversation with me if it's something you do!
Hey Tourmaline,

Ads stop being effective all the time. I don't have a hard rule for when to stop an ad, but 10 days of no profit (for me at least) would be enough to kill an ad.

"Is what determines how this pixel targets the people most likely to buy first?" - No. And pixel doesn't do that, it only tracks the conversions. Facebook's algorithm determines who to show your ads to. The principle is that those who are most likely to engage or convert see your ads. So usually it takes time to optimize (i.e. first you get no conversions and then as it learns about the audience more, you get more conversions)

There's a lot more to it than just the ad copy and creative. You also have to decide on the bidding strategy (media buys.)

I usually test the copy and creative with many ad sets. Each ad set is a $5 test. This way you can find the audiences that are most likely to convert.
 
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Tourmaline

Tourmaline

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Thanks for the reply Walter! I realize I'm probably asking pretty basic stuff. Sounds like I definitely need to pause this ad and come up with a new one.
 

Xeon

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I'm starting to feel FB ads don't make sense especially if your profit margin per product is not high enough to absorb the cost per clicks.

Let's say you sell a product for $30, the cost to manufacture is $15, so profit is $15.

So you run FB ads. In the first day, you get 600 impressions and 6 clicks to your landing page and 0 sales from that.
Each click costs $0.90. That's already $5.40 for 0 sales, which means $15 - $5.40 = $9.60, a huge chunk of your profit is gone.

Let's say it eventually takes 12 clicks to get a sale.
$15 - ( $12 * $0.90) = $4.20 profit

This is not even taking into consideration that you're spending and burning additional $ testing other ad sets. So, eventually, you're making a heavy loss for each product sold and unsold, unless your profit margin is crazy like 6000% or the cost per click is $0.001.
 

Solais

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You don't have to say what your niche is, but let me just tell you FB ads isn't for everyone.

If you're selling stupid cat and dog toys, or the latest eBook on "personal finance tips," or whatever, then yea. Facebook ads should be fine.

Let's say you run a locksmith business. Do you run FB ads? F*ck no. Why the hell would you do that? Just leave flyers, use an automated voicemail service, target landlords especially (since they want to change the locks to their rental units whenever somebody moves out) in an offline setting, etc.

You HAVE TO REMEMBER why people even go on Facebook in the first place. It's to

- Watch stupid cat/dog videos
- Share whatever stupid thing they did for that day with their friends (or "friends")
- Post their crazy uncle's conspiracy theories and political shenanigans to ignite another meaningless discussion
- Post pictures of their food (Yeah, I know, kill me already. Even though I ran FB ads before, even the thought of having to be on FB made me cringe. Thankfully there are much better channels for what I'm doing.)

They're not there to look at your ads.

Read that again. They're not there to look at your ads.

What you post on Facebook had better be damn intriguing and captivating.


Good luck.
 

Bryan James

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The best products/services sell themselves because of intrinsic value. The selling is inherent and organic, without need for the reaching that FB ads (and ads in general) stand for.
 

Xeon

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The best products/services sell themselves because of intrinsic value. The selling is inherent and organic, without need for the reaching that FB ads (and ads in general) stand for.
So it's basically build it, keep it somewhere (maybe in fulfillment center/home) and "they" will come?
 

Bryan James

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So it's basically build it, keep it somewhere (maybe in fulfillment center/home) and "they" will come?
Market the hell out of it at first, and if you can keep selling without continuing to spend money on advertising the market will respond. People will keep buying it even though you're discontinuing spending money on advertising (you've got a great service/product), or it will fall off the face of the earth (the product/service sucks).
 

Walter.LV

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I'm starting to feel FB ads don't make sense especially if your profit margin per product is not high enough to absorb the cost per clicks.

Let's say you sell a product for $30, the cost to manufacture is $15, so profit is $15.

So you run FB ads. In the first day, you get 600 impressions and 6 clicks to your landing page and 0 sales from that.
Each click costs $0.90. That's already $5.40 for 0 sales, which means $15 - $5.40 = $9.60, a huge chunk of your profit is gone.

Let's say it eventually takes 12 clicks to get a sale.
$15 - ( $12 * $0.90) = $4.20 profit

This is not even taking into consideration that you're spending and burning additional $ testing other ad sets. So, eventually, you're making a heavy loss for each product sold and unsold, unless your profit margin is crazy like 6000% or the cost per click is $0.001.
Yes, that is exactly what happens if you think about it in terms of one sale. The profit margin is low and you're not really making any money.

But here's the thing - you have to look at your Customer Acquisition Cost (how much it costs to acquire one customer) and Customer Lifetime Value (how much revenue one customer brings in over the lifetime.)

So if you just sell one product to one customer and that's it, then it doesn't make sense.

But if you learn about their buying patterns and build a back-end system (think email marketing) where you keep selling to the same customers over and over you can increase your CLTV and it starts making sense to advertise.
 

Xeon

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Yes, that is exactly what happens if you think about it in terms of one sale. The profit margin is low and you're not really making any money.

But here's the thing - you have to look at your Customer Acquisition Cost (how much it costs to acquire one customer) and Customer Lifetime Value (how much revenue one customer brings in over the lifetime.)

So if you just sell one product to one customer and that's it, then it doesn't make sense.

But if you learn about their buying patterns and build a back-end system (think email marketing) where you keep selling to the same customers over and over you can increase your CLTV and it starts making sense to advertise.
I understand, but even then, based on this, it means that in the above example, the company will be losing money for quite some time before the long term profits of the lifetime value of the customers kick in. Few companies have a large enough warchest to last like this.

Unless the company is in a situation where the cost per click is really low from the start and they're making profits from FB ads from the get go.....
 

biophase

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I understand, but even then, based on this, it means that in the above example, the company will be losing money for quite some time before the long term profits of the lifetime value of the customers kick in. Few companies have a large enough warchest to last like this.

Unless the company is in a situation where the cost per click is really low from the start and they're making profits from FB ads from the get go.....
This is why you can’t compete with larger companies. They can afford to bid more and wait for profits than you if you rely on a single sale for profit.
 

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Xeon

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This is why you can’t compete with larger companies. They can afford to bid more and wait for profits than you if you rely on a single sale for profit.
Ok, so you're saying the way to overcome that is to niche down?
Or forgo FB ads altogether and use other strategies like influencers?
 

biophase

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Ok, so you're saying the way to overcome that is to niche down? Or forgo FB ads altogether and use other strategies like influencers?
All I’m saying is that’s why people can bid $4 on a $20 product.

So you bidding against them is not going to be profitable with a single product. You’ll have to find more ways to make more money afterwards.

I can afford to run a slightly negative campaign for years if I can make money on a second purchase in 2-3 months.
 

Walter.LV

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Ok, so you're saying the way to overcome that is to niche down?
Or forgo FB ads altogether and use other strategies like influencers?
You have to find ways to increase the value of a customer. Which is usually done by giving them even more value.

The thing about influencers. The market doesn't know yet how to price itself. But it's going to even out over the next few years. So that means if your business is built around one channel and all of a sudden something changes (that is out of your control), you can lose the business (or it just starts losing money instead of making it.)
 
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Tourmaline

Tourmaline

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Thanks for the replies!!

I'm starting to feel FB ads don't make sense especially if your profit margin per product is not high enough to absorb the cost per clicks.
Yes absolutely. The things I'm advertising are not my lower priced items, they sell for $50-200 typically with enough profit to cover ad spend per order equaling up to cost of item while still leaving decent enough profit. My average order is $95.

You don't have to say what your niche is, but let me just tell you FB ads isn't for everyone.
I'm in the crystal business. So it's a luxury item, collector item, spiritual item, decoration item, etc. There are several crystal groups on Facebook as well so I know there's definitely a market and Facebook is a place plenty of people go to engage in t heir interest revolving around crystals.

However, I'm not yet the biggest fan of Facebook's system. In theory I prefer search engine based traffic, but I have not yet had much success with that, but admittedly have not spent much time on it either. I have had an organic search engine sale or two as well however, so it seems my touch of SEO is beginning to gain some traction!

The best products/services sell themselves because of intrinsic value. The selling is inherent and organic, without need for the reaching that FB ads (and ads in general) stand for.
For me the hard part is making people know I exist. There are many competitors, but what many of what I offer is very difficult to find elsewhere, and trust is a big issue as well as there are many fakes out there too.

However, repeat business is a big thing. I've had some customers already come back more than once which is quite exciting and great for business.

Ok, so you're saying the way to overcome that is to niche down?
Or forgo FB ads altogether and use other strategies like influencers?
Niching down is what I have done so far. I started off broad, and then figured out what people were buying and what my competitors seemed to have a lack of. I have a better selection of my sub-niche than the largest crystal store in the USA located in my state!
 

OliverR

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When a Facebook Ad was getting good traffic and conversions, and then keeps getting traffic but no more conversions, after how long should you typically pull the plug on it?

I understand that Ads only are successful for so long. I have an ad that had about a 5% CTR and converted for about a month, but for the last 10 days I've gotten no more sales.

Which is lame as that's eating profit!

I expected this to happen, but much later on. The audience I'm target is around 1 million, and the ad has only been seen by about 5000. I expected many more people would see the ad before it stopped being effective. Is what determines this how Pixel targets the people most likely to buy first? Then the rest are basically not likely to buy?

I'm pretty new to this and eager to learn, I appreciate any insight!

I'm also looking for a consultant btw, feel free to start a conversation with me if it's something you do!
Hi Tourmaline. Have you already signed up for "Facebook Ad Buyers" group on Facebook? Probably the best place to lurk around and absorb info on the subject and ask questions, generally the people there can be helpful given you've already done some research on your own
 
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Tourmaline

Tourmaline

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Will check out the group, thanks!
 

Bearcorp

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I’d also recommend following Cat Howell on Facebook and her group Facebook Ad Hacks for more information.
 

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