The Facebook Disrupter: Facebook Ads Top 100 Advertiser | Business Development, DTC, Lead-Gen & SAAS

How to Make Money with Facebook Ads Running at Below a 1x ROAS


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Now I know what you’re thinking: "Making money while losing money, how is that possible?"  Well let me dive deep into how the best of the best companies utilize Facebook to generate massive gross profit and revenue while running Facebook at a loss.  So the first thing to understand here is that Facebook is not the end all be all Omnichannel solution to revenue and sales for most big successful businesses.  Facebook functions as an intent creation device, for customers in their purchase decisions journey.  One of the biggest misconceptions in marketing, is that platform ROAS means anything.   Instead of looking at return on and spend, which is one of the absolutely most worthless Metrics a Business can look at, look to cost per Acquisition, look to lifetime value, and look to average order value.  How much is your customer actually worth it to you?   Very very few successful businesses have a customer value equal to what the customer pays on the initial purchase.  Even if you have no other sales channels live, and Facebook is the only source of traffic, if you have no email, customer service search or anything else live, Facebook is still not able to quantify the total value of over all conversions driven from advertising on Facebook.   Users will see your ads, and then go to your site without clicking.  Users will see your ads and click and buy but have an ad blocking on.  Users will see your ads and buy inside of the app and you can never file your cookie.  The point here is successful business is built on the development of a business model.  The maximum value of that business model is predicated on understanding the incremental value of every channel that drives awareness and intent.  As a good general rule of thumb: the higher the percentage of revenue that you see on a daily basis, that is not directly attributable to 24 hours after the click on a paid platform, the better your business is going to do.  The point here, is that we need to develop good business models and understand the incrementality that Facebook, and all other channels bring to the table.  The best businesses, have this ingrained in their culture.   The biggest businesses I know, and that I have worked on myself, tend to lose money every day according to Facebook.   Because of the added value that they get from their business model…  Actually running Facebook at a profit with a limit business success.  I highly recommend you look into an EcoSystem ROAS, and you begin to evaluate success by how much money you spent today and how much money you made today, and measure that with week by week and month by month Trends.

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The Facebook Disrupter: Facebook Ads Top 100 Advertiser | Business Development, DTC, Lead-Gen & SAASBy Charley Tichenor

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