How much money should I spend on Facebook Ads
- I get this question a lot.
- So what I would do is to look at my conversion rate.
- I will reverse engineer my numbers
- I will ask myself
- Out of X number of leads,
- How many appointments would I set?
- How much sales would I make?
- SALES ÷ NUMBER OF LEADS = VALUE PER LEAD
- Example when I am selling my course for $997
- Leads: Out of 100 leads
- Appointments: I will set 50 appointments
- Sales: I will make 10 sales X $997 = $9,970
- Value per lead = $9,970 divided by 100 = $99.70
- This means, so long as I am getting leads below $99.70 per lead, it will be profitable
- So normally, my first $100 is used for testing. I set that aside and test different audiences, different copywriting, different advertisements.
- Then I will look at what’s the cost per lead. So long as the cost per lead is LESS than the value per lead, I will keep scaling that campaign infinitely.
- I will scale it until it breaks
- It will only break when either
- I have too many leads that I can’t handle
- I overwork myself
- My ad cost is more than my sales