A lot of my participants of the eCourse Launch formula ask me how I decide how much to spend on my Facebook Ads budget particularly during my launches.
So I’m going to share with you a pretty foolproof strategy to do just that. But I warn you, you’ll probably need your calculator.
This is how I work out my Facebook Ads Budget for an eCourse launch:
- Decide on my list growth goal as a result of the ads
- Work out my cost per email for the specific launch opt-in
- Work out my total cost to achieve my list growth goal
- Work out the length of time my opt-in will run for and
- Work out my daily budget
So to begin with you need to ask yourself a question – “How many people do I want to add to my list this launch?”
So for example let’s say you want to add another 500 people to your list.
Then we need to work out what our average cost per email is.
To do this I recommend you do a trial ad for your eCourse opt-in with a budget of say $20 or $50.
Once you have done this your should work out your cost per email. In other words for your budget of say $50 how many people opted in?
For example let’s say you spent $50 and got 15 opt-ins. That means that your cost per email is: $50/20 = $3.33 per email.
Now we need to work out how much it will cost to get those 500 opt-ins
To achieve this you will need to spend 500 x $3.33 (cost per email) or $1,665.
Next work out the length of your promotion period
For example 2 weeks running a video series opt-in promotion.
Finally work out your daily budget
Take your required expenditure ($1,665) and divide it by the length of time the opt-in will be promoted (14 days).
$1665/14 days = $119 per day.
We now have a daily budget of $119 per day.
Now you might be thinking this sounds like a lot of money.
Let’s put it in perspective and work out the value to you of each subscriber or opt-in to your list (from a purely financial point of view).
Let’s say you have a list of 1,000 and are currently making $50,000 per year from your business.
Your value per subscriber is $50,000/1,000 = $50 per subscriber. Now some will spend more and some will spend less but overall this is the value per subscriber
So under this example each person on your list is worth $50 to your business. Suddenly $3.33 per lead is not looking so bad hey ?
Now let’s give you some guidelines around what the experts think is an acceptable acquisition cost for an email using Facebook Ads.
Amy Porterfield wrote (in a recent email to her list) that an acceptable cost for brand new leads (email opt-ins and not likes) from Facebook ads was between $3.00-$8.00. So again this scenario is looking pretty good.
Let me throw in one last statistic.
With offers to your list you can generally see a 2% conversion rate.
Therefore if you grow your list by 500 during a launch using facebook ads you could expect to see 10 of those (or more) sign-up for your offer.
Are these ads a good return on investment?
To work out if these ads represent good return on investment for the eCourse take your cost to acquire ($1,665) and work out what 10 sales would be equivalent to.
For example an eCourse sold for $299 * 10 sales from facebook ads = $2,990 revenue and therefore a profit of $1,325 plus a heap of new leads on your list.
Use with care
Remember this example was just that, made up numbers to explain the process, everyone’s numbers will be different and their return on investment and value per subscriber will be different. You should complete this exercise using your own business numbers to determine if Facebook ads are a good investment.
I hope this process gives you some insight on how to set goals and budgets for your Facebook ads and then critically assess whether the acquisition cost represents good value to your business.
If you’d like to learn a whole lot more strategies for your eCourses sign-up to the e-course launch formula