How I DOUBLED A Client's BFCM Profit

Welcome to my first newsletter! No ads, just tactics to make you more money.

Here’s what you’ll be learning:

🤯 DOUBLING a client’s profit?! YUP. This isn’t clickbait. Keep reading.

😬 Why scaling behind this common strategy can cost you $10,000+ in daily profit.

🔎 The scaling metrics you need to be using.

Let’s get this party started 🕺

The night before Cyber Monday, I was feeling bold & fired up a Twitter poll.

”Should I F around and 2x a client’s Cyber Monday profit target tomorrow?”

Was I talking YoY growth?

NO. That’d be too easy!

I’m talking double their 2023 Cyber Monday contribution margin target.

MTD we were on pace & just pulled ahead by 3% after a successful Black Friday.

Our client couldn’t be happier!

So WHY & HOW could I possibly do this ONE HOUR BEFORE Cyber Monday??

Let’s dive in 👇

WHY?

Short answer: because I’m a crazy MFer

Hitting this client’s goal was looking too easy IMO, so why not make a statement?

Now for what you care about…

HOW?

First things first, I need to let the Homestead crew know what’s going on.

I fire off a message mapping out the goal & later the overall gameplan:

• $30k Contribution Margin (client’s goal was about $15k)

• $100k+ Revenue

• $80 CAC/nCPA (client’s goal was $90)

It’s now time to prove a very popular, yet overly simplified scaling strategy wrong 😤

The strategy in question…

“We had a great day yesterday! Run it up!”

If you work at an agency or brand, I’m sure these statements aren’t new to you.

This happens ALLLLLLLL the time, regardless of brand size.

Although it’s a solid starting point, it doesn’t tell the full story.

Let me tell you why that’s a BIG mistake. Especially during BFCM…

You’re overspending! 💸

Time to elaborate…

People who have been waiting to snatch your best deal of the year are ready to buy.

You’re sending a TON of Email + SMS campaigns, posting all over your social media, and spamming your offer wherever you can.

The WORST thing you can do (if you care about maximizing profitability), is blindly gassing all of your Paid spend.

That surge in revenue is NOT fully attributable to your paid acquisition channels.

”GOOGLE ROAS WAS AT 6X ON BLACK FRIDAY, WE SHOULD TRIPLE IT MONDAY!”

“THIS IS OUR BEST CAC, WE NEED TO DOUBLE OUR META SPEND ASAP”

WRONG!

This is the fastest way to cannibalize your profit.

Joel, so what the heck should I do instead??

I got you!

Let me take you through the play-by-play

You NEED to monitor each channel’s performance!

ESPECIALLY if you’re spending $20k, $100k, or even $1m+ on ads in a day.

I’m going to show you exactly how we did in a sec.

By 11 AM EST, we are CRUSHING. Right on cue, here comes the itch to push spend:

I’m not arguing with that... But before I scale, let me find out WHY we’re crushing.

The first thing I check is our Email/SMS campaign calendar (we manage it too)

Sweet! We already pulled in $7k from our morning Email & SMS send.

That worked well! Especially considering their sale had already been live for 2 weeks.

Knowing Cyber Monday is back-loaded, we doubled down on what was working & spun up an extra SMS for later that evening.

Utilizing their YoY Shopify data, we found their peak hours and scheduled it for then.

Now it’s time to turn our attention to the big spender, Meta.

Our client really wants to push Meta spend, but retention is off to a hot start.

That leaves me a bit skeptical & need to find out how Meta ads are performing.

Here are key metrics we keep a close eye on when making buying decisions:

• 1DC ROAS

• 1D CAC

• 1D Attributed Revenue

• CPC

We already know the Triple Whale dash is looking fantastic for blended KPIs.

So let’s look through their ad account.

It’s Cyber Monday, so obviously you expect your BFCM ads to be ripping.

Surprise! Evergreen outperformed the majority of ads containing BFCM messaging.

I mean look at those CPC costs... NO shot these have a chance being 3x more expensive compared to the account benchmark.

“BUT IT’S BFCM! Ad costs are obviously up, you dummy.”

Alright fine… let’s look into the conversion metrics within Northbeam then:

That ad set is CLEARLY not working. So what is and can we scale it?

Fortunately, we find something promising!

👀 A few evergreen videos from a creative test had the best soft metrics in the account: CPC & eCPNV (estimated cost per new visitor).

After diving deeper, it was also far below our CAC benchmark, but not spending much.

We make the decision to cut budgets on the losing BFCM ads and double spend on these promising evergreen ads.

Kinda aggressive, but here’s why it made sense.

We’re spending 4x more than their daily average 💸 

This means you’re getting an entire day’s worth of data in practically a few hours.

Not only that, but in my opinion, it’s even more accurate. Why? It’s same-day data!

This allows us to trust our data more vs only having the previous days to compare against.

On a day like this, you should monitor hourly breakdowns on every platform: Facebook, Triple Whale, and Northbeam.

Our metrics continued to hold strong after each hourly refresh. So that’s promising.

CAC is in check. Contribution Margin is pacing toward our 2x. Ad metrics are beating their benchmarks.

So what do we do? We double spend again... and again.

Each hour our Meta performance held up, even when utilizing super narrow time windows to make these decisions.

Something important we made sure to factor in were spikes the 1-2 hours following any Email/SMS campaigns.

This kept us locked in on the paid metrics we should scale behind.

Peak hours arrive and we had their best 2 hours of contribution all day!

But you’re not going to guess what we did…

We lowered spend.

Although overall contribution margin was at its best, our Meta performance began to soften and it made sense…

We were approaching their historical hours of decline.

It’d be stupid to push spend there just because CAC/CM was strong, but our Meta data was telling us otherwise.

This is EXACTLY where most brands and agencies F up…

You can see the next hour’s contribution margin was really low (validation to cool spend)

The hour after that ended up being our most profitable hour!!!

Did WE F up?!

No. We knew last-chance campaigns were being sent at that time for an extra push.

So… did we end up doubling their profit?! Time for the results 👀

DOUBLED their contribution margin goal while beating Revenue & CAC targets.

All with 10% LESS actual spend vs forecasted.

Absolutely UNREAL 🤯

See what I’m saying now? You don’t NEED to spend more to hit your #s.

If you’re a hater tempted to say we missed Rev & CAC by ~3%, I have bad news for you…

It rolled in after their brand’s timezone setting. Every metric was beat 😤

Here’s the best part… Results continued all week! 👇

I told you these strategies are evergreen too!

Every DTC brand should be doing this.

Here’s to more $$$ landing in your pockets, and less in Zuckerberg’s 🥂

Well, my first newsletter is officially a wrap!

I hope you found value in this breakdown.

If you have any questions or feedback, lmk!

If you spend over $30k/mo on ads and want to maximize your ad spend (& profit), apply to work with us at homesteadstudio.co

Not there yet, but feeling stuck? Message me for 1:1 consulting