If you can break even and make profit in the front-end from your Facebook ads, that is fabulous. In fact, I wouldn’t run any ads unless you’re breaking even or making profit from your ads immediately.
However, you need to increase the average value per customer.
Each customer has a lifetime value. And it’s your job as a marketer to increase that lifetime value over time by following up with them.
So in marketing there’s two main timeframes:
1) The Frontend
This is the first offer you make to people, it’s the first sale. It’s what you do to attract viewers, convert interested people into buyers and have them enter your sales funnel or other marketing campaigns.
If you’re running Facebook ads to cold traffic, that’s your frontend.
2) The Backend
Everything you do after acquiring the customer is the backend. This is where you increase the average value per customer with special sales, marketing campaigns, product launches and discounts.
It’s important to follow up with your existing customers.
In fact, your customer email list is one of the most valuable assets you have in your online business. So make sure you use it.
Let’s do the math:
If you run Facebook ads for a free plus shipping offer and your cost per purchase is $4, your product and shipping costs are $3 and you’re charging $10 for shipping and handling, you are making around $3 profit per sale in the frontend. Obviously you can do a lot of things to increase your profit margins, but that’s a good start.
That means your average value per customer is $10.
However, by following up with your customer email list, launching new products, sending out special discounts and doing limited time sales you can get those same customers to buy other products from you.
Since you’ve already acquired the customer and have them on your email list, any additional money is pure profit in your pocket.
With good backend marketing you can increase the average value of every customer to $12, $15 and maybe even $20. Now the initial $4 that you spent to acquire the customer has turned into $20 over time. It may take 12-18 months until that happens, but keep this in mind. Backend money is a huge source of revenue for businesses.
All Posts
Website
