Digital Social Hour - Getting Banned on Facebook, Successful Paid Ads & Spending $12M on Tiktok I Maxwell Finn DSH #435

Episode Date: April 25, 2024

Maxwell Finn comes to the show to talk about getting Banned from Facebook, how to run successful paid Ads & spending $12M on Tiktok Ads APPLY TO BE ON THE PODCAST: https://forms.gle/D2cLkWfJx46pDK1...MA BUSINESS INQUIRIES/SPONSORS: Jenna@DigitalSocialHour.com SPONSORS: Deposyt Payment Processing: https://www.deposyt.com/seankelly LISTEN ON: Apple Podcasts: https://podcasts.apple.com/us/podcast/digital-social-hour/id1676846015 Spotify: https://open.spotify.com/show/5Jn7LXarRlI8Hc0GtTn759 Sean Kelly Instagram: https://www.instagram.com/seanmikekelly/ Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Starting point is 00:00:00 AlphaBrain is an amazing product. Celebrity Factor, we were able to start with them when Rogan was really blowing up. So we rode that train. They also pay a lot more to acquire a customer. This is pre-unilever acquisition, post-unilever acquisition. And they were like, we're going to pay more than we make day one to acquire a customer. Because we value that. So they were paying us right out of the gate probably $50, $60 a customer.
Starting point is 00:00:21 Now they're paying us well over $100 to acquire a customer. Wherever you guys are watching this show, I would truly appreciate it if you follow or subscribe. It helps a lot with the algorithm. It helps us get bigger and better guests, and it helps us grow the team. Truly means a lot. Thank you guys for supporting, and here's the episode. Welcome back to the show, guys. Got with me possibly the number one TikTok ads expert in the world right now, Maxwell Finn. How's it going? Good, man.
Starting point is 00:00:48 I would wish he started with maybe like the number four, number five, so that way people's bars like here can just do better. And it's number one at the end, maybe. I mean, you're spending $12 million a year. You've got to be in the top three, at least, I'd say. We're doing okay. Yeah. I mean, I don't know anyone spending close to that on TikTok.
Starting point is 00:01:04 So why'd you go all in on TikTok? I mean, it comes back to what we were just talking before we hit on the show, is I got banned by Facebook. So it was almost a necessity. I built my entire career on Facebook. Started early, early. Maybe not, like with TikTok, I was really early, like before they even launched publicly.
Starting point is 00:01:21 Facebook, I was kind of in that first wave. Did really well. We built a large agency with Kevin Harrington, ran for 3M, Samscope, all these amazing companies, and then started teaching about it, speaking about it. And then, probably three years ago, I logged in one day,
Starting point is 00:01:37 and I had that little box that says, your account's been banned. And we've talked to a lot of people over the years of people that can recover and stuff, because we've gotten plenty of ad accounts back for our buyers everything but like my account was like nuked it's like a level where they can't even do anything about it and what's crazy is like i didn't do any like i hadn't really been on facebook for a while you have media buyers like i wasn't really running any facebook ads at the point so it wasn't like i was something i posted or not i ran or whatever and still to this day no no reason given that's weird no ability to
Starting point is 00:02:06 appeal i think someone got paid off or something i don't know we can put tinfoil hats on yeah we can get we can get pretty pretty crazy there but um but yeah so it was a necessity like so i got banned and then i was like what do i do yeah like my identity was kind of built around this i was like the facebook ad guy and all the speaking things and so i was like okay i don't know what to do and then kind of serendipitously at the the Facebook ad guy and all the speaking things. And so I was like, okay, I don't know what to do. And then kind of serendipitously at the time, I'd gotten an email maybe three months earlier from some people at TikTok
Starting point is 00:02:31 saying, hey, we're rolling on an ad platform. Can we show you what we're building? So reached back out and said, hey, let me take a look. And I had said no the first time because I didn't use TikTok. I couldn't understand it. I didn't get it.
Starting point is 00:02:43 So I said, yeah, let's hop on a call. They showed me what they were doing. They showed me all the stats. They're behind the scenes of just the app metrics and growth. And it was just like, it was insane. We all know kind of the stats now. But back then it was like wild how much better it was than meta in terms of engagement and usage and all that stuff.
Starting point is 00:02:58 And so I said, well, I've got nothing else to do. We have our team running ads. So I might as well try to figure this out. And jumped on it, started running ads there, started trying to figure out the platform. And transparently, early on, not great. Results were pretty poor, very bare bones, ad platform, not great tracking, not great attribution. But stuck it through, and then the first Q4 on the platform, saw some things start to do well, start to perform, ads for brands like Goalie and stuff.
Starting point is 00:03:27 The rest is history. I just started really doing more on it, building more on it, creating more content around it, speaking about it. There wasn't a lot of people early on. Even now, there's still not a lot of people that are actually running a lot of ads there in the agency world or doing it well. It's a secondary thing or a third thing. We kind of do stuff there, but it's not a priority for a lot of ads there in the agency world or doing it well. It's like a secondary thing or a third thing.
Starting point is 00:03:45 We kind of do stuff there, but it's not a priority for a lot of businesses out there. I can only think of you and Cole Gordon. What's funny about Cole is, Cole's great. We did consulting with him a year and a half ago to get them and their team on to TikTok. They're doing great.
Starting point is 00:04:02 They moved a ton of spend. They were spending $20,000, $30,000 a day on YouTube at the time. This was a while ago. They moved a ton of spend. They were spending $20,000, $30,000 a day on YouTube at the time. This was a while ago. They moved a ton of that spend to TikTok. They were just getting incredible calls. Had to work on some of the quality stuff. Quality is lower, but they're rolling out a ton of amazing stuff
Starting point is 00:04:17 on the Legion side. My buddy Brian, who's my first rep there, and this is the cool thing of being on platforms early, is the access and the people that grow. My buddy Brian was a rep, my first rep there. Over the years, he's grown and grown and grown, moved to departments, and now he's running the lead gen department over there. Just get this amazing insight from them. On a lead gen, they know quality is a big thing.
Starting point is 00:04:36 They're rolling out a lot of cool features like direct integrations, HubSpot, CRMs to pass back purchase data. You can optimize for actual purchases, not just leads. Lead forms are adding more qualifying questions. You can basically question one on an instant form and a lead form. You can ask, hey, do you make $50,000 a month or more? Just basic.
Starting point is 00:04:54 If they do, that's the only event that fires back to TikTok. Anybody says no, they don't even learn from that. The modeling and everything is much better. There's a lot of cool stuff they're rolling out there. Yeah. You're big in the agency game.
Starting point is 00:05:06 I know you're doing crazy volume there. How have you seen the agency space sort of evolve from when you first got into it? It's gotten a lot tougher. Yeah, more competitive. More competitive because whenever something starts doing well, then there's all the biz ops come in,
Starting point is 00:05:20 all the education, everyone starts teaching it. And so agency is still to this day, I think, probably the easiest way for a kid out of college to make six figures. Even if you're charging a low-end two grand a month, you need five clients, $120 a year. And you can manage that one person. So a lot of people jumped into it,
Starting point is 00:05:40 flooded with competition. Businesses are jumping from agency to agency. So what we're seeing is this move from retainer to performance. And this is one thing we've done massively over the last year. We've made a huge shift to go all-in on performance. What I mean by that is we front the ad spend. So all the ad spend goes on our credit cards.
Starting point is 00:05:59 And then we get paid a CPA or CPL, so we get paid on a purchase basis. And high risk. Yeah, because what if the ads don't work? This is what we spent so much time on. This is why we're so good at it. A lot of people think of performance marketing. All these agencies want to get out now.
Starting point is 00:06:14 They all want to start doing this. There's so many things that I'm thinking about. One is the vetting. We've spent probably six months perfecting the application form, the right questions asked, how to vet offers, how to onboard and test offers, because every business wants it. Every business in the world, if you said to them,
Starting point is 00:06:31 hey, we'll spend our money growing your business, and you only pay us per sale, and you pay us a number that makes sense for you. Sign me up. Every single business wants that. But most businesses aren't in the position to do it. Their funnels don't convert, their offers don't convert,
Starting point is 00:06:45 they can't afford to pay what they need to pay. Because they might have an $80 cost consumer. They're like, we'll pay you $20. It's like, no. So Onnit, for example, Joe Rogan and Aubrey's company, that was our first performance partner. We've been working there for over four years. We've sent 120,000 plus customers their way.
Starting point is 00:07:00 We've done over 10 million commissions for them. And the reason that works is, one, amazing offer. AlphaBrain's an amazing product. Celebrity factor. We were able to start with them when Rogan was really blowing up, so we rode that train. They also pay a lot more to acquire a customer. This is pre-unilever acquisition, post-unilever acquisition.
Starting point is 00:07:18 They were like, we're going to pay more than we make day one to acquire a customer, because we value that. They were paying us, right out of the gate, probably $50, $60 a customer. Now they're paying us well over $100 to acquire a customer because we value that. They were paying us right out of the gate probably $50, $60 a customer. Now they're paying us well over $100 to acquire a customer. Just for one customer? For a customer because they have a $39 cost consumer for one
Starting point is 00:07:35 but most people buy the bundles but they have subscription and it's supplements. It's like AG1. Their lifetime value for athletic greens is ridiculous. $80 a month, people stay on for years and years and years. That's why Russell's been able to grow so well with ClickFunnels. They pay way more to acquire a customer than they make day one.
Starting point is 00:07:54 That's the secret. If you want to grow a business today, make it so you can pay more to acquire a customer than the competition. Most people aren't willing to do that. They're not willing to do that. Or they just can't. If you're a startup, you don't have cash in the bank. You don't have subscription, reoccurring revenue, multiple products. This is what you've got to do that. They're not willing to do that. They want to make money, or they just can't. If you're a startup, you don't have cash in the bank, you don't have subscription,
Starting point is 00:08:05 reoccurring revenue, multiple products. This is what you got to do. So yeah, most people can't do it because of that. They also don't have the economics.
Starting point is 00:08:15 Are you interested in coming on the Digital Social Hour podcast as a guest? Well, click the application link below in the description of this video. We are always looking for cool stories,
Starting point is 00:08:24 cool entrepreneurs to talk to you about business and life. Click the application link below, and here's the episode, guys. If you get paid even on the best basis, like a net seven, right? And let's say for AlphaBrain, like last month, we did about 1.2 million in commissions for them. So we were spending $50,000 to $70,000 a day because they really wanted to ramp things up. So they increased the CPA for us, they want to push volume. That means we're spending $50,000 a day on our cards. We get paid on a rolling seven-day basis,
Starting point is 00:08:50 which means you need to essentially have enough credit to put $350,000 on a card or have enough cash reserves to do it. Most people can't. They want to get into the space but they don't think about those things. Things go well on scale. Everyone wants to scale, but they don't think about the economics of scale and what that means. I think a lot of people want to move to this space. I talk to a lot of big agency
Starting point is 00:09:08 owners that are friends of mine, and they're tired of the retainer business. It's exhausting. The power dynamic is way off. And there's a cap. Yeah, there's a cap. And you're constantly getting bitched at. The clients, you have a great day, awesome. You have a bad day, they're on your ass. You can have 100 great days in a row, you have one bad day, they're blowing you up, Slack, text, all this stuff. It's a pain in the ass. And then you're dealing with phone calls, reporting, meetings, Slack messages
Starting point is 00:09:34 every day. With performance, we talk to clients on maybe a monthly basis, we check on it. Hey, what do you got for us? Any new creative, any requests, stuff like that? That's all Paul cares about a lot, the guy there. And we're the last person they're going to fire because we send them customers every day at a number that makes sense for them.
Starting point is 00:09:50 They're not even paying you upfront. Yeah, we're not going anywhere. So our life cycle of a client for performance is way longer. We don't have to worry about churn. We can build deep relationships. And then from there, it's like, this is the flow I think, right?
Starting point is 00:10:03 You have retainer agency everyone wants to get into. Most people get stuck there. Then you move to performance, where you're doing CPA, CPL, rev share, profit share deals. I would avoid profit share, because then you're dealing with what's an expense, what are we putting on the books? Then it's equity, where you're getting a piece of the company, which I think more and more agencies should get, because you're a huge part of the growth, especially if the company is less than $10 million a year.
Starting point is 00:10:24 You can double, triple companies. You should get a you're a huge part of the growth, especially if the company's less than 10 million a year. You can double, triple companies. You should get a piece of that. And then eventually it's, well, let's build our own thing. Let's either acquire and scale or start our own thing. So we know so much about Nootropics. We've run so many Nootropic offers over the years. Why don't we have a Nootropic offer?
Starting point is 00:10:39 Why aren't we building something there? And that's why we're launching Unicorn Brands and we're doing a fund because that's the idea is, well, we can actually invest in or acquire businesses and then we have everything else you need to grow a business. We have all the other things that you need. When you invest, if you're private equity venture capital, put money to a company. They're going to use that for growth.
Starting point is 00:10:57 Where does the money go? It goes to marketing. We do marketing. We have capital. It's like now we have capital and marketing. Let's really grow things. Got everything you need. Exactly.
Starting point is 00:11:06 Yeah. And is that when you started your political company? Because that one's doing 20 million a year, right? Political, it's a huge story. So we started this in 2016. Oh, okay. So 2016, we had the agency with Kevin. So we had Quantum Media. Kevin and Brian, his son, they had done the Obama coin last election cycle. They did a collectible coin for Obama. We were running agency stuff.
Starting point is 00:11:31 We said, well guys, we have the marketing team, funnel building, let's do it for this election cycle. We built everything out for Hillary. Trump won. We saw the election results come in. We're going to be up all night rebuilding everything. We rebuilt it for Trump, exploded. bad it was just the trump coin yeah i saw this we did the original trump coin i saw that so we did the first trump coin um we did i don't know five or six million in a few months which at the time was made i mean it was massive
Starting point is 00:11:59 for us yeah and uh the mistake we made was we ran it we did really well the coin we didn't we treated like an offer instead of building something on it so we kind of just it just died off and that's the thing about political businesses political businesses are very cyclical so they hit they go crazy for two years leading up to an election for a few months after the election and then they just die right so most people in our space that popped up last cycle, they don't exist anymore. They're bankrupt. We started 2019, 2020, let's do this again, but let's do it right.
Starting point is 00:12:32 We did it, made a ton of money again going into the last election cycle, had a lot of issues because of all the stuff that happened at the election. We were spending, right when that happened in January, on Parler, we were spending $110,000, $150,000 a day just on Parler. Everything was crushing.
Starting point is 00:12:52 That's the truth. Parler got shut down. We were talking to the people at Parler. The whole thing might go down. Amazon took them down. Everyone took them down. We went from spending a ton, making a ton, to dead again and now we're leading the selection cycle with very different business because we started most people all like they all copied us started doing the coins
Starting point is 00:13:11 like little cheap print on demand drop shipping products that are all like crappy so we actually invest a ton of money like making unique trademark products so we have like amazing bobble heads we have collectible graded cards we have have the Trumpinator bear, an actual teddy bear. Our bobblehead, it's like the Trumpinator. It's like Schwarzenegger, Terminator. It's on his plane. So Trump Jr., Don Jr. posted a video in the cockpit. And on the actual cockpit, on the dash, is our bobblehead. It's actually sitting there. Did you send it to them or they bought it? No. Wow. Somebody, the pilot bought it or somebody bought it. That's sick. That's an ad creative sitting there. Did you send it to them or they bought it? No. Wow. The pilot bought it or somebody bought it. That's sick.
Starting point is 00:13:45 That's an ad creative right there. Yeah. It's a wild business. It's a crazy business. There's all kinds of stuff that I could spend hours talking about just that business. But yeah, this year it's been going really, really well. We're doing 1.7 a month in that business. We've built reoccurring revenue into it, which I think is really important.
Starting point is 00:14:04 Most physical product e-com businesses don't think about reoccurring revenue into it, which I think is really important. Most physical product e-com businesses don't think about reoccurring revenue. Huge mistake. I think every business should have reoccurring revenue. It changes the game of how you can go out acquiring customers. We have a subscription program, does about $500,000, $600,000 a month, and then the rest is straight sale.
Starting point is 00:14:20 What do they get when they subscribe? We launched a first pilot of pile around it. We're actually rebranding and launching a brand new one that's way better. That's more like a Fabletics model where they get credits
Starting point is 00:14:30 and stuff like that. But right now, up to date, it's been collaborative. They get discounts on the whole store. They get discounts from partners we work with.
Starting point is 00:14:38 They get a physical, really beautiful printed physical newsletter. We send them a five-page thing. They get content. They get courses. They get training, survival, self-improvement,
Starting point is 00:14:47 prepping, all that stuff. And then giveaways. We're adding a bunch more stuff to the new program for the next year. Because our plan is, we know the next 12 months it's going to be crazy. So ideally, we do 40 plus million next year.
Starting point is 00:15:02 And are you doing both sides, or are you just doing Trump stuff? We've tried. Back in the last cycle we launched DemsFor2020.com. Couldn't sell a thing. We've tried it numerous times. If it does so well over here, why don't you do it over here? We've tried. We can't get any traction.
Starting point is 00:15:22 It just doesn't work. People aren't as passionate on the Democrat side probably. It just doesn't work. People aren't as passionate on the Democrat side, probably. Yeah, it just doesn't work for whatever reason. I feel like Republicans are more open about showing, you know. Yeah, I mean, on the right, it's like so much passion. Yeah. So much energy. They want to show their support, not just financially,
Starting point is 00:15:40 but actually demonstrate things. Like, I have this, I have this, I have this. They're going to buy everything you put out. I agree. Yeah, because I sold this, I have this, I have this. They're going to buy everything you put out. I agree. Yeah, because I sold Trump when I had Jersey Champs. I did Trump jerseys and I did Obama jerseys and even Hillary. But yeah, Obama and Hillary didn't even sell.
Starting point is 00:15:54 Yeah, I'm sure the Trump jersey just went crazy. By far, dominated. Yeah. What was it like meeting Russell Brunson? I mean, that dude's a billionaire, right? Russell's cool. I sold startup drugs to him, which is kind of cool. Yeah.
Starting point is 00:16:07 So this is a wild story. So before I even met Russell, I knew Russell for a long time because he was just one of the best marketers in our generation. And I had startup drugs, the apparel brand for entrepreneurs. That was my first e-com business I started. And I remember one day seeing an order come in. I had two orders that came into that website that I was really like, this is so cool.
Starting point is 00:16:28 One was Miami Dolphins. The order came in, it was Miami Dolphins. It had their address and stuff. They bought a bunch of stuff. The other was Russell. He bought a ton of t-shirts. Then he wanted to buy a bunch of stuff from us over the years. That business never did great.
Starting point is 00:16:40 I made a lot of mistakes with it. We ended up selling it. It was a fuller for like 100 grand, something like that. And it was more strategic. The guy was going to be like a whole entrepreneur podcast network and he was going to tie into that. And two years went by and Russell reached out on Instagram.
Starting point is 00:16:56 He said, hey man, do you still own startup drugs? I would love to buy it. I said, well, I don't anymore, but let me reach out to the guy. So I reached out to the guy, and what's amazing timing-wise is at that time he had just fired the guy he hired to run it. They weren't doing anything with it. They basically were going to shelve it. So we said to him, hey, if we were able to get you back
Starting point is 00:17:14 what you paid us for it, would you then be willing to split anything over that 50-50? And he said, sure. He basically gets his investment back, plus he makes money reselling it. So we went back to Russell and said hey here's the deal we have a partner we got him to agree to it
Starting point is 00:17:28 and he said sounds good we gave a number cool we'll send you paperwork today get you money on Monday and it wasn't like a crazy number it was cool and I was more excited about it because I would love to see what he
Starting point is 00:17:42 nothing's really been done with it yet which I'm kind of disappointed about, but I'm sure at some point he'll do something with it. He's building a billion dollar company. He's got a lot of stuff going on. In terms of running great ads and getting high ROIs, people always talk about ad creative,
Starting point is 00:17:58 ad copy, website. What do you think the most important things are? I think right now what it comes down to is your creative, your angle, your offer, and the economics of your business. I think those are the four things that if you think about what's going to move the needle for a business in 2023 and beyond, those are it. All the technical days of media buying,
Starting point is 00:18:20 there used to be back in the day all these crazy strategies. If you dupe your Facebook ads seven times at 1 p.m. and you do this and this bid, you make money. I remember that. The platform's just getting so much better. Between AI and machine learning and all that stuff, a lot of the targeting, the bidding, the optimization, all that stuff, the platform's going to do that better
Starting point is 00:18:38 than the human being. They're not emotional. They're not turning things off and turning things back on and letting things get in their head. It's just based on data. Here's your goal. here's what we want we'll spend it effectively for you so if you're not worrying about that anymore
Starting point is 00:18:50 it's like well I need to have better angles better creative than my competition and on the creative side it's like I need to be better at grabbing attention getting hooks, sparking curiosity opening that loop up getting people to just get off the app you can't get them to pay attention to get off the app.
Starting point is 00:19:05 Nothing else matters. The best product, best offers matter. So you really need to have that. You can't be copying everybody. When it comes to angles, everybody, I remember this when Hermosi really started blowing up. It was everybody's like the captions, the captions. It's got to be that.
Starting point is 00:19:21 That's the thing. And so everyone was like, what font does he use? What style does he use? And then everyone started copying him. And it's like, that's not how you build something. What you want to be is Alex. You want to be the guy that everyone copies because you're the first person to do something like that.
Starting point is 00:19:36 You want to be the person that's setting the baseline. And so for me, it's like, our team I push, we always need to be testing different angles. We need to be testing things nobody else is even doing, things that nobody else is even seeing. And most are going to bomb, but it's all right. If you bat 250, you're doing great in anything we do. The performance marketing biz, anything we do.
Starting point is 00:19:54 If you're batting 250, awesome. 25%? Right, yeah. So 70% of things fail, but you only need a few. And that's even like a VC. You can invest in 10 companies and nine can be bombs and one's Twitter or one's meta. You're good.
Starting point is 00:20:08 That's the model. Then you do it again and again and again and it compounds. Those are things on the platform. It's as creative as it angles. Then it's your offer. Do you have a compelling offer? Do you understand consumer psychology?
Starting point is 00:20:21 I posted this the other day. If I was talking to a brand new marketer today and they were asking, what should I learn? Should I take a Facebook ad course, a TikTok course? Should I learn this? Don't worry about the channels or platforms or anything. Go read books on neuroscience. Go read books on behavioral economics.
Starting point is 00:20:38 Go read books on consumer psychology. Because you can understand those things, how the brain works and how consumers act and do things. Because it's not rational. Like if you look at guys like Rory Sutherland, right? It's one of my favorite books, Alchemy. Like consumers are illogical. They say things and they do things
Starting point is 00:20:52 and the things they do are different things they say, right? And so you need to understand these things and you can incorporate that into your offer, into your landing page. Little things, pricing psychology. Understand that like pricing something at 39 versus $40 has a massive impact. It actually matters. It's called charm pricing. So $1, anchoring, framing, things like that. If you
Starting point is 00:21:14 go to movie theaters and you have three sizes of popcorn, most places, and they've changed a little bit, but most places, they use, it's called the decoy effect. They'll put the medium popcorn and they'll price it almost identical to the large places, they use, it's called the decoy effect. They'll put the medium popcorn and the price is almost identical to the large popcorn. The reason they do this is because if you just have a large and a small, people go for the small
Starting point is 00:21:30 because the price difference is big. They're like, I'm not going to need a large popcorn. If you make it so it's $5 for a small, $8 for a medium, $9 for a large, people buy the large because now they're comparing
Starting point is 00:21:38 the eight and the nine. They've gotten me on that. That's how our brains work. You're no longer comparing large to small. You're comparing large to medium and large to better deal. So you take the large, right? And so understanding that and be able to incorporate that,
Starting point is 00:21:50 like The Economist is the most famous example of doing that in history. And that's one more story and then we'll move on. But when they went online, they launched an online only, right? And then they launched a print and online bundle. The online only has $59 a year, the print online was like $129 a year. Nobody took the $129 a year. They're like, that doesn't make sense, they're getting both things. But the problem is, $59 was such a big difference in price.
Starting point is 00:22:20 So what they did then is they added a third offer, and they added print only. And they priced print only basically the same third offer and they added print only. And they priced print only basically the same price as the print and web only. And now all of a sudden the flip, the demand for, before it was like 60, 40 or something like that, it flipped because now they were comparing, well, I can get just a print or I can get web basically for free. This is a great deal. I'm going to take this. And that changed the game for the economists. Wow. So these are things I think every market, every business owner needs to understand to put into their offers,
Starting point is 00:22:48 put into their landing pages. And then lastly, it's the economics. If you look at brands like Gymshark, the reason they were able to grow so fast, they have a negative cash conversion cycle, which means that they essentially collect money for things they sell before they have to pay for it. So for us, that's been a big success of Hero Brands.
Starting point is 00:23:06 So we sell a product on Facebook ads today. We don't have to pay for that product for like months sometimes. We have an amazing relationship with the guy that does all of our coins and stuff. And he'll invoice us sporadically. He's like, you guys, you have a $205,000 bill, you can pay now.
Starting point is 00:23:21 So we're able to float that cash. Most businesses, the vast majority, it's the other way. You have to buy inventory from China or wherever. So you write a big check today. It takes three months to get delivered. Then you put it on the shelves. It takes three to six months to churn through the inventory before you collect the cash. You have to float a lot of cash.
Starting point is 00:23:37 It changes how you can acquire a customer. If I can acquire a customer today and not have to pay anything other than the Facebook spend, I can scale a business way faster than you can scale a business. So those are the things that I think are most important right now when it comes to ROI on marketing. Wow, dude, that's so powerful. But that makes a lot of sense because when you're running ads, you're spending all that money and then you're stacking up product costs, shipping costs, so many costs. But you worked out basically net terms with your suppliers. That's a game changer.
Starting point is 00:24:08 And then you can snack in invoicing with TikTok. We're on line of credit with them. Oh, you are? Line of credit with TikTok. And so that's net 30, but it's the way that they do the billing. So it could take 45 days to 59 days, depending on the spend, because you spend the first week of the month, that's then 30 from the end of the billing cycle. Then you can pay that with a card, so then you can get another 30, and we'll pay that
Starting point is 00:24:32 with a Chase Premier card or something like that. We get 2.5% cash back on spend. It's over $5,000 payments, so you just pay them in bulk. So that's the thing with the performance business. If we spend a million dollars a month, the partners, we take, you know,
Starting point is 00:24:46 25 grand, just split it up between us every month. So we each get, you know, eight grand or so every month just from the spend,
Starting point is 00:24:53 not from the profit. There's all these little things that just like most business owners, most marketers aren't thinking about because everyone's so focused on like the technicals
Starting point is 00:25:02 or Facebook ads and TikTok ads and I got to pick the right, it's all these things that really are BS. And in the grand scheme of things, don't matter. It's incremental. We focus on things that are like, this is big needle movers. We do this thing.
Starting point is 00:25:14 It takes us from here to here, not from here to here. Love that. And how much money would you say you have to spend to get adequate data to know if it's a good ad or not? Because I know it used to be a lower amount, but now you need to spend more, right? Potentially. We have pretty tight kill points because we do performance. So we're funding the spend.
Starting point is 00:25:34 We're pretty aggressive when we kill things. And we kill things on different metrics. So we'll look at, we have CPC kill targets because we just know based on, we have a calculator that runs the data. Here's what our CPA is, here's the conversion rate they offer. We know that if a cost per click is over 100% the average,
Starting point is 00:25:52 the chance that that's ever going to work is slim. We'll do really tight kill points. Just rough math. If we spend half the CPA, the breaking CPA, and our CPC is double the average, we'll kill it.
Starting point is 00:26:07 So if we need to be at 150 on a cost per click, and the cost per click is like $6, and the CPA is 80 bucks, and we spent 40 bucks, we'll just kill that ad. Because what we also notice too is, yes, you need more data nowadays, because to get the algorithms to really get optimized, especially at scale, to use smart performance campaigns or automated shopping campaigns and stuff, or Advantage Plus.
Starting point is 00:26:29 But on the creative side, the ad side, we found things hit or they don't hit. You probably see on the content. If you do this piece and this piece, this piece, things are going to hit or they're not going to hit. So we're looking for hits, we're looking for wins. Sure, can we have false positives? Can we run something and maybe kill it prematurely? Possibly. But we found that a lot of ads,
Starting point is 00:26:50 the chance of this is a $6 cost per click for the first day or two, it's magically day three, day four going to be our best performing ad. Really doesn't happen. Whereas we find an ad that just crushes and it's getting 4% click-through rate out of the gate, it's got a $10 CPA on a $40 payout,
Starting point is 00:27:05 something like that, that's what we're looking for. So we want more of that, we want more swings, and if that means we've got to be tighter on killing stuff, we're fine with that. Yeah, that makes a lot of sense. Man, I've learned a lot, it's been a great episode. Anything you want to promote or close off with? We're not promoting too much stuff.
Starting point is 00:27:22 Our agency is super selective, so we don't work with most businesses because we have like really, really tight vetting. But if you're a business doing, you know, minimum probably 20 million a year that's looking to acquire 100 plus customers a day on performance, you can go to unicorntraffic.com, go through applications, see if it's a good fit.
Starting point is 00:27:39 And then if you want to learn from us, we have coaching programs, courses, you can go to unicorninnovations.com. That's the best place to learn. All right, love it. Thanks for coming on, man. Awesome, brother. Appreciate it. Great episode. Thanks, guys. See you go to unicorninnovations.com that's the best place to learn nice love it thanks for coming on man awesome brother appreciate it up so thanks guys see you next time later guys

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