HOW MUCH DO I SPEND ON ADS FOR MY LAUNCH

How much do I spend on ads for my launch?

Whenever I get this question from a client, I ask them what their revenue goal is and then we reverse engineer. 

Here are the questions I go through with my clients to determine how much we need to spend on ads to achieve their launch goals. Keep in mind, this is ONLY for Facebook ad traffic. If you are using other sources of advertising be sure to take that into consideration. You might not be spending ALL your advertising dollars on Facebook. 

Ask yourself: 

• What is the revenue goal for the launch? 

• What is the price point of your course offer? 

• How many sales will we need to reach that revenue goal?

• If you’ve launched before, what was your sales conversion rate? 

• If you’ve launched before, what were your past lead costs? 

• How many leads do we need to bring into the funnel? (you’re free experience, etc)

Let’s use this as an example:

Revenue goal:  $50,000

Course price point: $997

How many sales do you need: 50 ($997/50,000)

Past sales conversion rate: 1% 

Past CPL: $3.00

Number of Leads needed: 5015 (50/.01) (sales/ past conversion rate) 

If a client had this data I would assume we’d get lead costs about the same (maybe $1 or so more) and if they have converted at 1% in the past we can use that to predict what might happen during this launch. 

To generate 50 sales for this launch we’d need to bring in 5015 leads AND convert 1% of them into sales. That means, if your lead costs are $3 each, you’d need to spend $15,000 in ad spend to bring in those leads.

As I mentioned above, this is only for Facebook ad traffic. If you have other sources of advertising (either paid or organic) you should take that into consideration also. You might bring in 1000 of the 5000 leads organically - so you can spend a little less on paid ads. 

If this is the first time you’re launching you’ll have to guesstimate your lead costs and conversion rate. Cost per leads can vary from $1 to $50 depending on your niche AND the free experience you’re offering. Many of my art clients will get lead costs for a free download for $2 and a free workshop, challenge or webinar for $5. Coaches will likely get higher lead costs - between $8-$12 per lead for a free experience.

Sales conversion rate is another variable you’ll have to guess. I would start with 1% (even less) if you’re launching for the first time. 

It might be a bit of a shock when you realize how much you’ll need to spend on ads, but if you have a proven offer that you know converts you will likely be profitable from your launch. 

And if you’re just starting out - well….as I mentioned in a previous blog post…you have to start somewhere and you’ll use this launch as a test to collect data and learn. 

It’s important to know your numbers and use it to predict what could happen for the next launch.