How to Get Out of Low ROAS H3LL, Forever transcript

Let's get one thing straight. Facebook ads are completely different for brands that are just starting out versus brands that already have a proven process. And the results that you get are 100% dependent on the actions that you take inside of your ads manager. And you could basically be in one of two places. You could be over here with a very low return on ad spend, hardly breaking even, or even in many cases losing money every single day on Facebook ads.

Or you could be over here with a high return on ad spend, hitting your targets above your target return on ad spend, turning $1 into three, four, five. So in this video, I'm going to show you how to go from your low return on ad spend to your high return on ad spend. I'm going to be breaking down the main issues from auditing dozens of low return on ad spend accounts and how high return on ad spend accounts do the exact opposite. how you can steal the high return on ad spend process and then how you can maintain with each of these processes to continue to stay in that high rorowaz state so you don't get the results for just 2 days and dip back down again.

The first issue I see on the low return on ad spent accounts is that they have a terrible structure. When I say no structure, I don't just mean that you haven't followed my exact videos word for word. What I actually mean is that you're not following any process. And in many cases, people that have no structure, they have one campaign or they have 50 different campaigns. Everything is very messy. When they upload new ads, they just throw it into a new campaign.

They're running things like ad set budget optimization everywhere. Things are messy in general. And more important, if you asked that brand owner and ask yourself this, what's their strategy and structure in Facebook ads? If they can't reply back with their exact setup and structure, you don't have a structure. So here what all the brands that have high return on ad spends that are hitting their targets are actually doing.

It all starts with a concept called swim lanes. Swiml lanes is basically the concept that you need to have clear distinctions between who you're prospecting which we're going to call PR, who you're retargeting, which we'll call RT, and who you are retaining, aka your existing customers. Now, here's the thing. If Facebook had its choice, it's going to spend as much money as possible on retargeting and retention because it knows that those audiences are worth the most.

Think about it. Anyone who's been to your website is more likely to purchase and someone who's never even heard of your brand is in this prospecting bucket. The thing is, if you actually want to grow your brand, you have to do so with more prospects. What I like to do, what I always prescribe is that every time you're setting up with proper swim lanes in your ad account, you know, as an operator, as a brand owner, that you could spend way more money in prospecting whenever you want.

If you're spending $1,000 a day or $100 a day there or $10 a day, who cares? And you want to move this from a,000 to 2,000, you find the campaign that's prospecting, that has the proper exclusions in place, and you move it from a,000 to 2,000. You do the same process in retargeting and retention. The problem is is that Facebook will overspend in these buckets, which you could see right now in your ad account in 5 minutes by going to your audience breakdowns within your Facebook account.

And it will show you as long as you set up those breakdowns, how much you're spending on new, how much you're spending on engaged and how much you're spending on existing. And I would almost guarantee these numbers right here are going to shock you. You are not going to be happy by engaged and existing. You want to make sure that when you're increasing spend, you're trying to scale your account, you're actually spending on new customers.

The second thing that I see low return on ad spend accounts do all the time is that they think they're testing, but they're just wasting. Now, they do this with a testing campaign. I'm just going to call this testing in quotes. And I put it in quotes. I put it in air quotes here because testing is a ridiculous concept if you're wasting a huge portion of your budget every single day on quote testing. What this looks like in practice is you're spending an outsized portion on a campaign that's all or testing heavily or specifically orienting spend to quote tests.

Now, there are some times when you actually do want to test. For example, if you just spent a boatload of money on a creator or an influencer or just an ad in general, high production, let's say, then yes, we need to make sure that it gets an adequate amount of spend. However, in most cases, your testing is eating into your actual return on ad spend, which is ultimately creating a massive underperformance in your ad account because your best ads are being tested and your worst ads are being tested, meaning there's equal budget to nearly all of your ads.

What highros accounts do instead is they set up a competitive CBO environment. I'm just going to write CBO for us real big. What they do is they move from testing to CBO. They test within their CBO. CBO is better than testing because a CBO structure has multiple adsets. So, let's say each of these circles was an adset and then here is the big campaign. You say, "Hey, campaign, you could spend a total of $1,000 per day." It's going to distribute that budget wherever it thinks it's best.

That might mean that ads set number one gets five times more spend than this bottom ad right here. And the creatives within this ad that only one or two of these actually get the majority of the spend. And what that makes us think as human operators is, "Hey, this isn't getting the right share of spend. Hey, this isn't getting the right share of spend." And then what we want to do because we we're like, "Oh my gosh, there's creatives that need to get more spent.

We want to create a testing environment." And this is what the bad operator does. The bad operator starts testing and then they force budget to new adsets. Guess what happens when you force budget to new adsets? Where do you think it gets taken away? There's nothing here. It's all here. So then this cash here goes away and the money goes here. If these convert worse, which they most likely will because Facebook would have allocated spend to these anyway if they were better, now you're spending less on your best return on ad spend and you're spending more on your lower return on ad spend.

So you might see this is at a 1.5. Just making up numbers. And these are at a 1.2. You're like, "Oh, 1.2 is not too bad for us. That's okay." Guess what? 1.5 is better. Spend on the 1.5. Very simple. Okay. I know you're watching me over there on that side of the room with a whiteboard right now. But I'm here to tell you my biggest announcement ever. Just a few days ago, I officially announced that the program doors are opening.

This program covers everything a toz. I'm talking about strategy, structures, and systems that I've never ever talked about publicly before. Everything from my brain to this camera to the screen recording so that you could have access to everything that I know about Facebook ads. These are the same trainings and systems that my team at the Moonlighters uses to manage over 100 active clients. Now, this is meant to make you the sharpest media buyer possible, and it's also specifically built for brands and brand owners who want to manage their ads themselves.

So, if you want to be the absolute sharpest media buyer, the absolute sharpest when it comes to growth, marketing, and scaling, click the link down below where you can officially officially sign up to join the program. The wait list is over. the doors are open and they close on October 1st for at least three to six months. The third concept that I see all the time with these low return on ad spend accounts is that they're so scared of the learning phase.

There's something about the learning phase that just freaks them out. They can't seem to get out of the learning phase. They're always terrified of the learning phase. They're only willing to increase spend by 10 or 20%. Let me give you the quickest lesson ever on the learning phase. Here's how the learning phase works. You get impressions. Those impressions take some time to convert. Okay? They each take 2 days, some take 4 days, some take 1 day, some take 3 days.

So, what you're told is that you should only increase spend by small amounts. You're told by Facebook for the last 5, 6 years that, hey, if we're in this learning phase, we got to get out of it. We got to work out of it. Once we're out of this learning phase, then our results are going to go up. That's not true. What actually happens is you're in the learning phase, you try to increase your budget by 10%, and then you get one extra impression. that one extra impression.

This is our new impression right here, takes more time to convert because it's brand new. So, you don't notice that there's a dip in performance because you're only increasing spend by 10%. So, what actually happens, and this is what the best brands in the world do, is that they scale fast. The best brands ignore the learning phase. They don't care at all. So, we ignore the learning phase and we scale fast. Here's why this works so well, and I'm going to get a lot of heat for this, but I'm going to keep it real with you guys.

If you increase by 10%, the only difference is you don't notice the impact because it's only 10%. So you think, hey, maybe it's just a worse day. Maybe I'm just not doing as well that day. What happens when you go 100%. You double your ad spend. When you double your ad spend, instead of adding one new X, we're going to add a total of four new X's cuz we've doubled our ad spend. These are all now going to take more time compared to these that we've been nurturing for a little bit.

So now you're going to see a dip in your return on ad spend for a short period of time until these days start to check by. Then you will find a new norm. So if you were spending $1,000 a day, now you're spending $2,000 a day. You found a new level in your ad account because these new impressions just took a little bit more time. And as long as you deployed some patience, didn't freak out when you got one or two days of bad return on ad spend, then the learning phase doesn't really matter.

The learning phase is Facebook's way of telling us don't touch anything, don't change, don't pause. And that's why we've been indoctrinated to only increase spend by 10 or 15% at a time when in reality, the biggest brands are doubling their account right in front of your eyes. Enough about the learning phase. Let's move on to the next thing that low return on ad spend accounts do completely wrong. The worst, I'm talking the worst accounts that I see, and I literally audit these every single day. they have this thing in their head where there should be even distribution of spend against creative.

So for this, we're just going to say equal creative. You should never have equal creative in your ad account. So what I mean by this is if you look at your ad account, you just go to all your ads in your entire account and you sort by amount spent. What the worst accounts have is their top spending ad is only spending somewhere around 5% of their total ad spend. So they have a lot of ads that are active and all of those ads are spending just about the same amount or close right within 30% of each other.

What the best accounts on the other hand have is a completely completely different setup. The accounts that are running the best have a setup that is really favoring the top ads. So the best accounts are set up in a way where most of the spend is funneled into even just a few ads. What I normally like to see is one creative concept that owns at least 30% of the entire budget. When we see top ads getting the most spend, those ads are top for a reason.

They have the highest return on ad spend. They're driving the most incremental purchases in the account. We want to make sure those ads get everything and they've risen all the way to the top. Now, let's get into the sixth and final part of this video right here for what low return on ad spend accounts are doing all the time and how high return on ad spend accounts are basically doing the exact opposite. And this is creative turnover.

The low return on ad spend accounts that I'm auditing all the time have a very tough time turning over new creative. So creative is very important. It's a big variable in Facebook ads. But it's not necessarily about the volume of this creative. It's more about what they're turning over. Brands on this side of the board are always trying to chase the next concept. They see something cool in a different ad. They see something on Instagram.

They see something on Tik Tok and they think, "I have to go make that. That's going to save us. That's going to shoot us to the moon." It's not. The best brands in the world, all of the best brands, go to your favorite brand right now in the Facebook ads library, and I can guarantee they have hundreds of variations. The best brands, period, and a story have high creative turnover. The brands over here on the high return on ad spend side not only are able to turn over more creative, but that's not the key.

The key is that they're taking their existing concepts, they're taking what's actually working the best and they're creating more of it. Now, you might think new concepts, new concepts, new concepts. The thing is these iterations, they're so much easier to make, right? So, you can make iterations much quicker and that's one of the reasons they have high turnover of creatives. But the second thing that happens here is these iterations are not tiny little marks.

You're not changing the background from red to blue. You're changing the whole concept of the ad, but you're keeping a core element. What that does for you is it allows you to create quick creative iterations with either yourself or the creative team. And it ultimately allows you to use the data in the ads manager to inform your creative process. So, the focus of this video was how to get out of that low row state, how to get yourself onto high return on ad spend and stay there steady.

I broke out a lot of concepts here, many of which I have full-length videos on. But like I said earlier, if you want the full hands-on experience, we're talking everything that I have ever learned in Facebook ads compacted into one single program, click the link down below. And if you just want the free stuff, no problem. Click this video right here where I break down my top techniques for how I'm running ads right now in 2025.

And I will see you all in the next