Case Study: How to Use Audience Extension to Win Back Clients & Increase Ad Revenue
One of my clients, a niche media company with multiple titles, was getting notified by existing advertisers that they were going to stop buying media and instead, spend their ad budget with Facebook ad agencies.
This media company had a choice to make: Watch their good advertising clients walk away and possibly lose $500,000 in revenue or figure out how to effectively compete with Facebook ad agencies.
The old solution of sending more sponsored emails was burning out their subscriber list, so trying to save the ad account by offering more sponsored emails was not going to work. Now what?
In response, we launched an audience extension program to win back dollars clients were spending on Facebook via agencies. Once you understand how audience extension advertising works, you can quadruple your premium sellable online inventory within a few months. Read on to learn how this program was stood up.
Using Facebook Custom & Lookalike Audiences to Win Back Facebook Budget
As the above dilemma arose, we were experimenting with leadgen using Facebook ads. We uploaded each of my clients’ subscriber lists to Facebook to create Custom Audiences for each title, and combined with some other Facebook conversion pixels, started to run ads using Facebook Lookalike Audience. This helped us drive our own acquisition costs from $100 down to $2.
So, I got on an ad sales call with the group publisher and asked the former advertising client about the results they were getting using their new Facebook ad agency. During the call, the client admitted that their Facebook campaigns were not going well. After asking a few questions, it became obvious that their agency was not utilizing any Facebook custom audiences.
If you’re trying to generate leads in a niche market without using Custom Audiences, then you’re just playing the Facebook “slot machine.” Occasionally, you’ll get a winner, but for the most part, Facebook wins and you lose. By building and using Custom Audiences, however, we’ve literally rigged the machine in our favor.
I told the ex-advertiser that we now offered a full-service ad agency and could run their Facebook campaigns for them using our exclusive Custom Audiences and could guarantee that we would get better results than any other agency.
The advertiser responded, “I had no idea you had an agency. We have a completely separate budget for agencies with [high 5-figures] available right now. That’s in addition to the media budget that we used to spend with you guys.”
I wish I took a photo of the group publisher’s face when his jaw hit the floor. It was the “I’ve been selling ads to these guys for 5 years and never knew about that agency budget” look.
Since that time, we’ve not only won back advertisers, we’re literally taking business away from other agencies because of our audience extension ad program.
How an Audience Extension Program Works
Now I’d like to give you an inside look at how this audience extension program works. The below diagram illustrates how a media company’s custom audiences are used to generate lookalike audiences, which are served Facebook ads and drive engagement with the sponsor’s website or custom landing pages.
In the past, your email subscriber database was your gold. Now, thanks to audience extension, your Facebook, Google, and LinkedIn custom audiences (subscribers, pixeled web visitors, pixeled opt-ins, etc.) are becoming just as valuable as your subscriber list, allowing you to substantially increase your online revenue without sending another sponsored email or generating more click-bait traffic.
Based on my client’s exclusive custom audiences, we created “Lookalike” audiences that instruct Facebook’s algorithm to use its ~1,000 data points to find a similar audience to target. Since these custom audiences are exclusive to my client, no other agency can effectively compete against them.
Again, we're not sending subscribers more emails. We're just sending extremely relevant Facebook ads into our audience’s newsfeeds, which drives targeted traffic to the sponsor's website or custom landing pages we create for them -- and we track all of this.
My client added $1M in new ad revenue in the first six months. They're charging the same CPM rate for impressions that they get for website banners. However, the sponsors are actually getting more traffic because the click-through rate on the Facebook ads is higher than the website banner traffic that they were getting. The margins are 80 to 90% because my client is buying Facebook ads at a fraction of what they actually charge the advertiser for.
Plus, my client is generating new custom publishing revenue because many advertisers don't know how to create good Facebook ads -- so we create them. In addition, advertisers also pay us to create high-conversion “lead magnets” and custom landing pages. This year my client will generate at least six figures in new custom publishing revenue as a result of the audience extension program.
For a more detailed explanation of the above diagram, check out the webinar I produced, How We Doubled Our Digital Revenue in 120 Days.