February 23, 2020
How To Make $1,000/day PROFITABLY | Shopify + Facebook Ads Strategy

How To Make $1,000/day PROFITABLY | Shopify + Facebook Ads Strategy

(mellow music) – Yo, what is good, what’s up everybody? Welcome back, and in the last video we talked about actually
scaling campaigns. We went over what a push day was. If you haven’t seen that,
make sure you check that out. I’ll link it above. But in this video, I wanna
talk about the criteria I use in order to cut off ad sets
that are not doing well. Okay, there’s no point of
leaving a ad up and running if it’s not getting you the
profitable returns, right? So a lotta people are afraid of that, and it’s understandable, you know, you work hard for your money, you don’t wanna just see
it go down Facebook ads, but you need to know two things before you are running Facebook
ads in the first place. And those two metrics are
your break even point, and your ROA. Your break even point, they
go hand in hand, right, so your break even point
is the difference between what your product costs, and
how much you’re selling it for. So let’s say I’m selling
a product for $25, but it cost me $10. My break even point would be $15. So go ahead and find out
that number for yourself. That is the first metric
that you need to know. Now, the second number you
need to know is your ROA. This is a metric in, givin’
in Facebook ads itself. And I’ll show you what that
looks like in a few minutes. But this number is a metric
that Facebook returns to you, and it will show you on your dashboard for every dollar that you
put into Facebook ads, how much are you getting in returns. You know, before your cost of goods sold. So this different from ROI, it’s a return on ads spend. You still have to account
for your product costs. I’ll show you how to
calculate all of these numbers and get it for yourself. That way we know when to
make the right decisions for our Facebook ads,
and we know exactly when to cut ’em off or if you
should keep ’em running or not. So without further ado, let’s hop right behind the Ads Manager. And first thing I do wanna point off is that today’s sales, okay, so as you can see right here,
these are the sales for today, and I just got a sale actually,
so I gotta update this. What I’ll do is, see
that updates right there. And in the order metrics, we have the same numbers
being reported back. At around a 31% profit margin right, so $8.93 on average per order. Already today at a net
profit, pure profit, $253, and I’m just sitting
here in my living room, making a video. But let’s go to the ads, lemme show you what that
looks like in Facebook ads. Ads Manager right here, and you can see that these are my active
campaigns right now, so I set a filter to show
only the active campaigns, which you can see up here. But right here is where
you wanna pay attention to. There’s a column right here
called website purchase ROAS, return on ad spend. And you wanna go, if you don’t
have that showing right now, you need that, absolutely need that in order to make this work. So you wanna go into
your columns right here, and customize your columns,
go search that up and add it. But let’s go into the ad sets, ’cause that’s where all the
real stuff happens, right? So these are my ad sets
for the past week so far. So it’s set to, the time frame is set to, I don’t know if y’all can see it, but it sets it, June 10th to June 16th. And what you can see here is
I’m sorting all these ad sets by the highest ROA. And there’s a total of 84 ad sets here, and the highest ROA we’re
seeing is 15.0 right here, so that’s a really good ad. We have some that’s doing seven, some are seven, seven,
seven, seven, right? But then you go all the
way down and you’ll see that there’s a point of
ads that are turned off. They’re ad sets that are below two, right, so this ad set is not quite below two, but it was damn near break even. And that 2.0 ROA is my
point of break even. That’s the metric that I can’t
allow my ads to go below, or else my ads are not profitable. And the way you find out your ROA is you can usually find a
calculator somewhere, but because you liked and you
subscribed to this channel, I’m gonna go ahead and leave
a link in the description. You can go ahead and
use that ROA calculator, and it’ll look something like this. So this is what a ROA
calculator looks like. And it’s very easy to use, right. So all you gotta do is put in right here what your product costs,
so let’s say it was 25, and the product cost me $10, and I’m selling it for $25 right here. That is gonna give me these ROAs. So as you can see, at a 30% profit margin, if I wanna aim for that,
I need at least 3.33 ROA on all my ad sets. Now this is very important to know, because now you’re not guessing. And once you go into your Ads Manager, you can see right off the bat, all right, if this is not a 3.33 ROA, then it’s not profitable,
I wanna cut that off, it’s not meeting my requirements. And this gives you all the confidence when you’re managing
your Facebook ads, okay. So, very important to know
your break even point. Very important to know your
ROA, your required ROA. Now, for me, and for
this particular product, the product cost me $11, so it cost me $11, but
I’m selling it for 24. So these are the point of, this right here is the point of no return. So if my ad sets fall below a 2.0 ROA, which you could see right here, that means that I’m operating
at a 5% profit margin, which is, to me, again
that’s break even point. So I would consider this
the break even point. Now, any ad set for me,
that falls below a 2.0 ROA, is gonna get cut off, so
as you can see right here, anything that falls, so right here, you can see it’s cut off. All of these are cut off automatically. These are still running because they haven’t met the rules yet. And I’ll show you what that is. So what you could do is, and
this is a whole ‘nother trick that you probably wanna implement. What you can do is set
rules, set automated rules in Facebook, so I’m
gonna go to manage rules, and we’re gonna talk about
when to cut these ad sets off, now that you have your ROA and you have your break even point. Right here, as you can see, this is what your rules
are gonna look like. Just ignore this one,
for this example sake. This is a more complex one,
but there’s three rules that you wanna have. The first rule is gonna
be to turn off all ad sets after, this is my break
even point right here, so I put that in here,
so after a lifetime spent is greater than $15, for me,
or your break even point, and the purchases are less than one. Then you want Facebook to cut
those ads off automatically. And you want it to run continuously, this is how mine’s look. You could go ahead and configure
those however you want, so these can happen automatically for you. But this rule right here, rule number one, is basically telling Facebook
if my ad set has spent $15, AKA my break even point, and
has gotten less than one sale, or zero sales, then I want you
to cut it off, automatically. All right, so that is gonna eliminate a lot of guesswork for us from Facebook, and we can rely on Facebook
to cut those ad sets off. Like you’ve seen in my dashboard. The second rule is after, after the ad set has
spent over $20, right, and it has less than two
purchases, or one purchase alone, then you want it to cut off. Because if it spent more
than my break even point, and I have only one purchase, then I know I’m not profitable
right off the bat, right? So I can save this rule as well. And that’ll save you
a lot of time as well. Another thing is the last
rule, so rule number three is if your website, you wanna
put your break even ROA here, so use that calculator, like I said, and whatever that 5% number is, so this number right here, you wanna take that number
and go into your Ads Manager and configure this, so make sure it says when the website ROA is less than two, and it spent over $35, and it has over one sale,
then cut off this ad set. All right, so what you’re
telling Facebook to do here is in the lifespan of any
ad set that is running, if it spent more than $35, and
the ROA ever drops below 2.0, or your break even point,
then automatically cut it off. What this is gonna do is
save you a lot of time when it comes to trying to figure out which ad sets you wanna leave on, which ad sets you wanna turn off, and if I’m running these ad
sets at like a $10 budget, that means that the first rule isn’t gonna kick in until it’s spent $15. So that means that the
ad has automatically ran for more than, for more than a day, right? So we’re also taking account how much time it’s taking for that ad set
to optimize in each case. Now I just wanted to show
y’all that real quick because that’s something that’s, a lotta people don’t really
talk about is, you know, your break even point, and as long as you know these two metrics, you’re always gonna be
profitable with Facebook ads, and you’re not gonna
approach Facebook ads as if, you know, it’s a bunch of guesswork and you’re trying to
get lucky, or you know, you’re gonna have a strict regimen of these ads aren’t
doing well, you gotta go. And it’s not emotionally driven,
it’s data driven decisions that’s gonna allow you
to be profitable, okay. That’s what’s gonna make
you money in the future is just having a strict rule that you follow consistently
and religiously, and in turn you’re gonna
see your profits go up, and less wasted ad spend on Facebook ads. But I want you to keep in mind, like I said in the last video, not all your ad sets are gonna optimize the way you want it to. Each ad set has its own completely different way to optimize, and in most cases, you’re only, out of every five new
ad sets that you launch, you’re probably gonna get one or two that’s doing well, and that’s okay. As long as those other
three or four get cut off when you want them to. So as you can see right
here, I’m setting the filter so that only the active
campaigns are showing, and what you wanna do here
is go to your ad sets, right, and I wanna show you these because if I sort ’em by the hightest ROA, I’m gonna be able to see
that some of these ad sets have a ROA of like 14, 15,
stuff like that, right. But then you come down
and there’s other ad sets that are failing miserably. They don’t even have a sale. And those are the ad sets that are getting cut off
automatically by the rules. And if I keep scrolling down, you see how many ad sets
got turnt off at one point. And that just goes to show you that not all your ads are gonna optimize. But you don’t need 100% of your ads to work every single time. You only need about 20
to 25% of them to work, and just let those optimize,
play the longterm game, as you could see right here, this one has a cost per
purchase of $4, right. Only one sale, but still, it
ran it, that’s really good. This one has two sales at $3 each. And you know, spent 3.50, made $24 back. Spent $7.50, make $54 back. Lemme go out to the span
of like the last week or so and you’re gonna see that if you look at the bottom right here, a total spent of 1700,
and 4900 back, right? So you can see hand by hand, all right, I spent this much, I made this back. This is my profitability
metrics that I wanna look at, and pay close attention to. Anything that does not meet
these requirement, is gone. It’s dead, I’m cuttin’ ’em
off, no questions asked, no strings attached to the product, it’s all data driven decisions. This is gonna allow you
to free up your time, right, so after maybe you know, you probably been spending a couple hours, or maybe more than 30 minutes
looking at your Facebook ads, saying yo, I don’t know, should I make it, should I pull the trigger right now, should I make a decision
on cutting this off, should I scale this up? After three profitable
sales, scale your ad sets up. But otherwise set these rules up so that you are saving yourself the time, you’re saving yourself the headache, and you’re not in Facebook ads, you know, messing with ad sets,
adjusting the budgets, you know, and doing things like that, so it’s gonna ruin the optimization. So let ’em run, let Facebook
do all the hard work for you. Automate this so that it can be a business that you can live passively with, okay. And Facebook rules and
knowing your metrics, knowing these two important numbers is what’s gonna allow you to do that. So if you like this video, if you got some value outta this, make sure you hit a like, comment, let me know if you have any questions, and of course subscribe,
hit that notification bell so you can see more, you
know, tips and tricks that I’ll show you in future videos. And also, if you haven’t already, check out some of my other videos. I’ll link ’em right here for you. And that is all I have for today, I’ll see you in the next one. (mellow music)

19 thoughts on “How To Make $1,000/day PROFITABLY | Shopify + Facebook Ads Strategy

  1. Here is the ROA CALCULATOR: http://bit.ly/2Zwz2mD
    Did I earn a "LIKE?" What videos do you want to see next? comment on this thread

  2. How long would you wait before activating the cutoff rules? An ad set can be not profitable for a couple of days at first, so if you apply the "stop adset if sales are zero and I spent $15" rule, you could be killing off a sets too early…

  3. To be honest the rules you show up is totally killing because no one show these on YouTube thank you very much is Pape

  4. Ey man, great video, much value!
    I have 2 question tho:
    1.Are all of those ad sets with a same ad copy(creative)?
    2.And how much is the budget for each ad set per day?

  5. Great value Your roas calculator says up on the first line on the output side it does not show the lowest roas

  6. You have valuable information here. I have been collecting information on this business for now, but how can i actually start?

  7. Hi Mo, like your new webinar and this youtube channel has given me a real education. Appreciate how genuine you are and the clarity you bring to the content. God Bless

  8. For the third rule why did you choose $35 because not everyone is selling their products at the same price im selling mine at $39.98 including shipping with a BE margin at $27.39 so what should I put for rule # 3 I already know my ROAS.

  9. bro, i got to say it again . this is dope. never new you could do this with . facebook. i spend thousand not knowing i could have saved. you are going to go far. 👍🏼👍🏼👍🏼👍🏼👍🏼👍🏼

  10. Yo this is whats stopping me from moving forward.. math isn’t my thing not the deep stuff anyway.. but thanks man, I seen another videos saying your from nyc cool, I’m also from nyc

  11. hey i downloaded your sheet, much appreciated… but i notice that the ROA's total on the output side i'm getting the totals in %, for example..your sheet the sample one you have shows 1.44
    @5% but once i downloaded my own saved as my own totals come to 144% how can i get mines like your's please, and thanks again. i'm fan man..Harlem Strong!!!

  12. What is the concept of your Cost Per Click? Is it how much money you spend for every 1 customer to click on your product?

  13. Hey Mo. I tried to purchase your course but it didn't go through. I emailed you as well with my concerns. Please help

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