Facebook Basics For Small Business (With Guest Oliver Schultz Of Centaur Consulting Group)
Struggling with your Facebook ads? Feel like they're taking more than they are returning? You are not alone. A ton of business owners like you are trying to crack the Facebook code. Since this performance marketing medium is a compliment to email, I wanted to sit down with an expert to see if he could shed some light on what small business owners can do to see some healthy returns from Facebook ads.
In this episode, I sit down with Facebook guru Oliver Schultz who is making some big wins for his clients. Not only does he have a ton of great insights to share, but he has included some great resources below.
Have questions for me? Send them my way at Conversations@emailgrowthsociety.com.
Listen to the podcast here:
Facebook Basics For Small Business (With Guest Oliver Schultz Of Centaur Consulting Group)
You’re in for a treat. I am seeing a ton of my clients' struggle with their Facebook ads. Seeing as it is a complementary channel to email, I wanted to sit down with an expert to help get some details. Luckily, I knew just the guy. I'm sitting down with Oliver Schultz, Founder of Centaur Consulting Group. Not only is he filled with actionable wisdom but he is doing great things for companies. How is ten times the revenue in one year a great thing? Pay attention closely to the episode. He shares some valuable nuggets. Let's get started.
Oliver, thanks for joining me.
It’s my pleasure, Amy. How's it going?
Great. I'm excited to dive into these Facebook basics. I've been inundated with questions from followers, as well as clients. Generally, in the small business community, we're seeing a lot of this how to crack the Facebook code. Before we dig into these wonderful tips, you're about to give us, tell the readers a little bit about your experience and how you've been helping clients with their Facebook ads.
You're not alone there. If you're struggling with Facebook or with your paid media efforts in general, there are tons of businesses out there. In fact, the status is around 80% of businesses on Facebook spend under $1,000 a month and they're trying to figure it out. There are thousands of other people like you. The fact that you're already reading this is an excellent step to take.
A little on me. For several years, I've been in the industry. I started out in the nonprofit space doing a little bit of free work, trying to get my ground game in Facebook and general marketing. When I went agency side a few years later, I focused a little more on paid media specifically while building up my client portfolio on the side. I realized, “There are a lot of people that need support for this stuff.”
A few years ago, I started full-time and built my own agency, Centaur Consulting Group. Essentially, what you can do to generally help with Facebook if you're going to take away anything from this, is you should figure out what your marketing goal is relative to what you're trying to do with Facebook. Usually, a lot of people have trouble with that and figure out what your budget is relative to that. Some people think, “I want to get more clients.” That's great, but what does that mean to you? How exactly can Facebook fit into that? We should figure that out. This should help you figure that out by figuring out what your specific smart goal is. I can get into that a little bit further. Do you want me to go into additional details on that, Amy?
Yeah. We can jump into that in a bit. Your background is amazing how you've had a bunch of different industry expertise as well, especially from that nonprofit lens. It's so interesting you talk about smart goals because an email is the same thing. A lot of times, we jump into clients and they're measuring their success simply off of an open rate or something like that. You realize that you haven't set the actual goal. You have to understand those micro-conversions that get you to that goal. There tend to be some big gaps in that logic. I'm excited for you to dig into smart goals in the episode.
If you're a business owner and you're not a performance marketer, especially in eCommerce, a lot of these business owners have got their Shopify site, they're running the Shopify site, they're trying to do email, and then they need their ads. It's so important. What approach should they be taking to set up their Facebook ads? Do you have any easy how-to steps for them?
Video is the most engaging type of ad you can possibly get.
I hear this all the time. One of the other things is being for nonprofit side things. I love helping business owners and helping people in general. I used to do a little bit more mentoring at SCORE, which came up all the time. I'm glad to hear that as well, too. It's one of the things to generally think about. It’s trying to keep things simple. All these things go on a Facebook account, especially if you're looking for the first time. It's like, “What's going on here? What are all these different metrics? Where do I create my campaign? How do I make my money?”
Let's get into a little bit more of the specifics with smart goals. It's a good place to start because we can tangibly figure out what to do with your budget and priority. For example, I've had two different clients that are trying to figure out budgets, one is an eCommerce client and another is in the music industry. One fellow in the music industry wants to try to get more people to show up to his shows because that develops his following and then, in turn, he can monetize from there.
For him to leverage Facebook, he wants to try to get around 40 additional people to show up to his shows, and then from there, that's supposed to help with his bottom line. His goal is 40 people per show and he has two shows a month. This is what I was going through with him exactly. From there, I have a calculator that we use to figure out his total budget.
I'll give you the example version. All this stuff is with NDAs and all that good stuff. Some of these things are more examples of mislay samples that anyone could do. This should take you about ten minutes. Start off with having that smart goal in mind. What I like to do is a three-step type of funnel for something like that. You start off with what your desired goal is. For example, if you want 40 event signups, your total budget could be $2,500. Essentially, you plug in your goal into this sheet and from there, you work your way back into the metrics based upon what you anticipate your click-through rate is, your cost-per-click, and your conversion rate.
Overall, that's something where an expert comes into play. There are some places where you can do this yourself. Starting off, you can do this, but having a marketing partner is useful, like an email. The same thing with Facebook, having somebody to figure that stuff out with you can help you achieve your marketing goals. Essentially, I come up with the budget from there. Say we need 40 signups. If it costs $2 per click to get a signup and we have around a 3% conversion rate with a 0.5% click-through rate, that means we need to reach 250,000 people. We would then get 1,250 people to click-through. When we get those people to click-through, that's how we get our 40 signups, so that would give us a budget of around $2,500. It's impure.
I'll give you the calculator afterwards to review yourself. You can use this for eCommerce, lead gen, and music signups like this, too. It depends upon what you're looking at. Empirically, it says, “This is what my goal is.” That's why it's so important to know it. “I do this on a monthly basis.” That's the other important thing. If you need this in a week, quarter, and so forth, I would adjust accordingly. That's the gist. That's how you can go from, “What do I do?” To like, “This is what I need for a budget.” That's the important thing to figure out. “What should I create in my Facebook account?” That's where I would start from there.
It took about five minutes to explain. I assume that's a game-changer for some folks to figure out, you have a goal, how do you get a budget. That's how you use this calculator. You might need a marketing partner for some of this stuff because this is based on my industry knowledge. In my experience, it usually takes a couple of years to get adjusted to the industry. Four to six to become a nuanced expert to figure out the benchmarks off the top of your head and all that good stuff. For any business owner, you could just plug away this calculator or if you have questions, feel free to reach out.
It's so interesting, as a business owner myself, having to do all this research on Facebook ads, you never see anything out there that helps. You helped a whole bunch of people. That is fantastic. In that same vein, I hear a lot of the different types of ads and how you use them, especially when I'm working with one of my email clients and we're trying to work on tactics for list growth. Any clarity you can give around the types of ads and how they are used best.
I'll give a link afterwards because that will let you hear the different types of ads, dry cut some additional information based upon this. By the way, this information is based upon my prior trainings. I probably should have gone into that. I've gone through different boot camps, and gotten certs, not only free but the paid certs. We're in some of the stuff through my Master's program, as well along with the hands-on training with my clients, because that's the best way to where you're doing it.
The tidbits on this one, video is the most engaging type of ad you can possibly get. There are two parts. One is it's the cheapest type of ad to get out there. To get impressions, that's the best way to do it. Facebook and Instagram are a combined company, but Facebook, in particular, favors video because it's more engaging for that reason. You get more click-throughs and more people viewing your video, and all that good stuff.
The little secret sauce behind this type of ad is you can build up your remarketing more effectively, especially with iOS. Say you get somebody to view 25% of your video or three seconds of it, you can then remark it to them versus having them go to your site to then build up your audiences and get more effective engagement. That is one of the better ad types to start with if you can. It's harder for all people to get videos and such, so the single image ad is the classic one to start off with.
In general, those two are what I would stick with. Carousels are good for different products if you're showcasing a story. The experience is great for that, too, along with the collection. If you want to focus on those, I would consider the single image in the video, your top two ad formats. If you get videos, great. If not, then I would just focus on those single images.
At the end of the day, even with all that in mind about video, the best thing you can do with the images and the videos in general is you should craft up something that people care about, look to speak to them with the visual, whatever it is, and think, “What is it going to motivate them to look at this ad? What is it that's going to be so compelling about this?” It doesn't matter what type it is. If you have boring content, boring content is going to blend it. If you have great content, people will look at it and probably see us all the time on social media. I would use that as a reference point and think, “It’s interesting. How can I do something with this for my business?”
One thing I find with email is that a lot of brands are so married to their brand guidelines and this certain look and feel that sometimes when we go to implement it into email, we're like, “This is not practical for email.” It's a living, breathing thing and we've got spam filters and things like that. In some ways in email, we have to adapt the brand a little bit. While it still looks like it comes from them, we still have to do some things. Do you find some brands take some bigger creative risks with Facebook ad videos? Is that something you see? Should they be a little bit, I’m not saying in their safety zone of their brand, but exploring some more risky creative options?
Amy, first off, I totally hear you on that. I had a conversation about that exact topic where the client was talking about how they didn't like the length of the text on the ad. The point is to tell a story versus having direct call-outs for promotion to get somebody compelled and involved. Whatever you feel most comfortable with, with your brand. That's why I said to the clients, “If you're more comfortable with a shorter call out, that's the route we will go with.” We want to make sure we're respecting that.
At the same time, I would consider it relative to what you can do and what you ought to do. For some industries, it's not necessarily recommended to do certain things like, “You shouldn't go off-color. You shouldn't go a little bit too far if it doesn't relate to your end goal.” A lot of folks with creative can get a little bit out there.
One basic example that I can think of in commerce is that one of our clients has a few products in the winter apparel side of things that are his top performers and are his top products throughout the year, which is great for him. He wants to spend more of his budget, more than 10%, towards new creative for spring and summer products, which makes sense.
However, with some of these clauses in the creative, it can go a little too far in his success. If you spend more and you do more creative testing and things like that for these things that don't work as much to get your revenue, your risk is not hitting your revenue goal. If that's your end goal for the account, you should consider not testing that creative or doing it over a long time.
It's harder to create results with a small budget.
In general, for brand guidelines, that's my two cents on it. I would push the envelope if you can as long as it relates to people, but you shouldn't go far for the sake of going too far. Two examples I can think of from a prior webinar I did, were from two big cruise lines that focused on COVID impacts differently. The Carnival Cruise Line was Disney and their brand guidelines had two different approaches. One was direct. They approached it and said, “COVID is happening. It’s a big deal. We want to be there for our employees and make sure we're supporting our people.”
They changed their messaging from, “The global views and all the beautiful places and destinations you can go,” because that's what they do, destination marketing, versus the other one focused on that a lot further because it made sense for their brand. That makes sense relative to their goal because they don't only do cruise lines. They do other things as well. That's all I have to say about it. Have it make sense relative to your goals and what your brand does.
Go back to the goal. That is probably the best advice we can ever give anybody, so that's great.
I’ve been saying this for years. To me, it sounds redundant. It sounds simple, but it's effective. I cannot stress that enough. Focus on your goal.
We can start some goal movement because I feel the same way. It’s still shocking that folks don’t have goals and you’re just shooting blind. You spent the first part of the show giving some good advice on how you can start by creating some smart goals. If I’m a business owner and I’m calculating this up and I come to say that number, let’s say $2,500, what if I don’t have that money to spend at this moment? Am I still going to be able to see results? Should I still give it a go? How do you work that if you don’t have a lot of money to spend?
I think of it like an iron triangle. You have time, you have your goals, and you have your budget. Those three things tend to tie together. If you have to sacrifice someone, the other two need to be strong. If you don't have the budget, you could use that budget over a longer period of time and then maintain that same goal. You could have a lower budget for the month and then save the other half of that budget, then you should expect around half that goal.
To be honest with you, at a smaller budget, it's harder to create those results. It’s difficult to establish your marketing efforts. Once it's established, it's almost like a flywheel to a degree and you're trying to add to that and grow it. That's my advice on that. Bring back your expectations a little bit, if you will, and also consider when you want to approach the market for Facebook.
A lot of folks see it as, “This is a channel where my target audience is and I can sell a little bit more.” Fantastic. That's great. If you can do more in email or through referrals for less, I know that sounds weird coming from the PB expert, but I would do that. I do that right now for my business and we're doing that before we establish ourselves more in Facebook and LinkedIn because we want to do it step by step and make sure we're getting the most out of our budget.
If you don't have that total budget, either pull back and think, “Perhaps this amount.” If you don't have $1,000, maybe $500. Pull back your goals or do it over a longer period of time, or consider a different channel that you're currently focused on. Let's say you're focusing on email with some of your clients. You may expand that out a little bit further and then tease Facebook a little bit more. Put your feet into the water, if you will, and try to figure it out from there. Give it a little bit more time, a little more flexibility. With a lower budget, it takes a little more time for these things to work.
Those are good tips. I was chatting with a couple of my clients who were telling me, “Nothing's working on Facebook.” I'm not an expert at all. I'm learning a lot in this episode. It was amazing because when you start to help them break it down, they've got $500 and they have it going for 60 days. Frankly, in the industry, they're competing against some big competitors who have great market awareness. This is helpful to understand. I love the triangle approach that you mentioned. That's amazing.
To be honest, that will help because a lot of folks see this and it's like, “It's not working. What do I do?” You don't want to spend more, or you do, but you're nervous about getting more results. Take it step by step and make it as tangible as possible. I will keep repeating this all day long. Focus on your goal. What's your end goal and how can Facebook achieve that? I appreciate that. I hope that this is helpful to your clients.
This is how it is with email. We get everything going and then it's like, “We're going to want to improve performance.” We don't have an expert yet to help us, but we've set everything up. Our budgets are decent and they're live. What best practices do we use to improve ad performance?
I would start off from scratch because this varies from client to client with three things. One is your offer. When you're starting off, look to see if people are engaging with it and even converting. If they're clicking through a lot more, say if you have above a 0.8% click-through rate, your CPC, cost to compete, is around $2 or less. That's a good sign that people like what you have to offer. Make sure it matches relative to your audience.
The other thing is to start building more remarketing audiences to reach back to people who engage with you more so they come to your site or give your ad like. They liked it, commented on it, or anything like that. Start off with little things like that. Look at the engagement metrics, build some audiences off those, and then look for different ad copy tests, basic stuff.
I think of it like looking at the forest or part of the forest. Look at the trees in the forest and you look at the limbs on the trees to find that top performer because you're trying to weed out different options. It depends, especially your client size. When you say $500 over 60 days, they should be trying to compete in a smaller pond against other smaller fish of their similar size. They need to figure out within that pond what audiences are going after. What exactly is it that gets people to care a little bit more, click-through, and buy or sign up? That's where I would start.
Back to my initial points, look at those click-through rates and CPCs, and then eventually get more into conversion. As you see, people are engaging more, that's how you optimize, so focus on their top-performing copy. It makes similar variations. You don't have to make a whole new one from scratch. take your top performer. For example, if I'm seeing a feature-based ad with different check bullets and call-outs performing better than a feel-good emotional ad, I'll try to find out their different features that perform better in the next ad test and that's how I optimize. It's basic stuff.
It seems like you're choosing one variable to control.
When you're trying to optimize these things, pick one thing at a time. Especially with a smaller budget, the perk is there's a little less maintenance, but it can get worrisome to have something not perform for a little bit. Focus on one thing at a time. For example, you're trying to sell hats and you want to sell a bunch of hats and people are interested in hats. You have two different ads. Great. Focus on that ad and copy test to see how the ad performs.
Figure out what's your key differentiator and how you can bring that to Facebook.
The standard benchmark I look for, for ads is that they each get around 2,000 impressions. If you can get up to 5,000, great, but if your budget is limited, 2,000. You've gotten it in front of 2,000 people, whether it's duplicate or not, to see if it performs and see if people cared. I can list this stuff out, but that's getting a little further into the weeds. It's good for smaller accounts. That's why I recommend for bigger clients to have somebody to partner up with. How you look at emails, I assume you look for things like that, open rates, engagement, and all good stuff.
That’s why you and I are in the industry. It's interesting to gain the system a little bit and try to find ways to help clients win within their current budget and then scale that up further. That's how businesses are built. It's cool because you're able to do things like that. Cost decrease of 30% could improve your margin by 30%, technically speaking, which means that you can do a lot more with your money for your business. That's what I like doing with clients. These things help me get through the day because it's so rewarding. It's awesome.
When you bring an expert in, there's a lot more of that marrying up the connection to the audience. Especially from a business owner’s perspective, their goal is often simply to create revenue. They're putting out these ads where as a consumer, as a human, I'm numb to them because they don't pull my emotional strings. They don't connect with me as a person.
I find that with email a lot. It’s like, “If you wouldn't open this email yourself, we probably shouldn't send that.” Having somebody like an expert like you, you're starting to connect how this ad reaches the human, which we forget a lot of the time. Especially working with some of these smaller eCommerce type companies with a little more of that direct response connection and an ad can generate revenue for them, but there’s still a human looking at that ad.
That's why looking at your offer and what you're putting out into the market is so important. Especially in eCommerce, the average consumer probably sees a lot of different options. You should consider that relative to your business. For example, how many different brands of clothing do you think you and your family have on average?
Probably 12 to 15 types of brands.
The average I've heard of is around eight. That probably varies a little bit based upon families versus single folks and so on, so forth. That being said, what your clients are trying to do and the same thing that my clients are trying to do is essentially saying, “You have these current brands. You want to be one of those brands swapped in with one of those other bubble brands.”
Say you have a few products from lululemon, but not too many. You have a different product from these other clients that they're selling. You need to figure out how exactly you can get somebody interested in your product versus that current product they're using right now. It's something that I missed with Facebook and in general as a whole. That’s something that should be considered with your copy and your differentiators getting that little bit more.
That's the whole point. The offer is to say, “This sweater is made from tri-blended fleece. It's made 100% of US,” or things like that. You figure out things that the consumer cares a little bit more about, like, “I'd rather support local economies and try to have something made of a certain type of material because that's what they like or that's what they're looking for.” Great. You may have gotten that purchase. Flipside, if you didn't mention that and your competition does have that, they have a leg up on you. The ad copy testing is one of those things you got to figure out.
Facebook's great for that because, besides email, it is a cheap forum to get that learning from. Essentially what you can do is figure out from thousands of people at a low cost. “Is this product something that people like? Is there something about it that they like? If so, how can you make a little bit more off that by leveraging that?” For example, with Maroon Bell, we leverage the fact that their buffalo leather gloves are three times stronger than the regular leather. A lot of ranchers, farmers, even people that enjoy driving their car around the city and things like that see that as a key differentiator and that's helped them a lot with growing their business. It's figuring out for you what's that differentiator and how do you bring that to Facebook.
Before we wrap up, is there any way that someone can use their email list as an audience in Facebook?
Yeah. I recommend that you have at least 2,000 people because that will allow Facebook to find more people in its database to match with. That's the recommended number to figure out. The other thing is that's the minimum to take a look-alike off of. That's essentially saying you have that sweet spot of people that purchased with you. If you could find people that 1% like them, so they have similar traits, Facebook, engagement patterns, and things like that, you can target those people based upon that list if you have 2,000. I highly recommend it. It's a great best practice. The only thing is making sure you have at least 2,000 people.
I was curious for myself, but I'm sure there's a reader out there that will probably be like, “Great,” so that's awesome. Now's your moment to preach. I always have to put this here at the end. I know you've talked already about some big mistakes, not having a goal, probably being the greatest. If you could think of a few more, what are some big mistakes you want to help readers avoid?
First off, you should go with Centaur Consulting Group for your Facebook ad management needs. You should if you need to. In general, vanity metrics. As you start optimizing ads a little more, there can be more focus on click-through rates and cost per click, and you could avoid your end goal. That happens a lot as you're focusing on your account a lot further and is a good reason why you should find somebody to focus on that for you to find that balance between optimizing efforts versus getting that revenue or getting those people to fill out the form things like that.
Time to test. Especially with a smaller budget, I give this starting off, say you put $500 out there for 60 days, $500 for you could be a lot relative to your total budget. Say that's not 10% of your budget. That's 50%. That could be a little bit nerve-racking for some folks. I would still recommend giving things time to test. Give it at least a couple of days. Usually, seven days is ideal for certain tests depending upon the map data you get. That's why I like having that 2,000-impression benchmark for certain ad copy tests so you know, “These are some of the people that saw the ad.” If it didn't perform in 2 to 3 days and it only had 1,000 impressions, you know that you should let it test a little longer.
A lot of folks starting off pause the test right away and say, “It's not converting. It's getting a poor click-through rate.” That could change because we don't have statistically practical data. Even with that 2,000, you can still get more data but at a smaller account size. It's better to have a number like that to go off of to get practical data.
The final thing I have listed here, not having a goal in mind with all that in mind. When you're testing or when you're trying to optimize your account, you should be optimizing towards something. This is why it’s good if you have something established. Say if you have a 1 ROAS or 1.45 ROAS, you make a little bit of money off your ad efforts. You should figure out your goal and try to work towards that, so you make decisions based on that goal. That's the gist. Vanity metrics, time to test, and just not having a goal in mind are the big three things I see all the time.
You mentioned ROAS, return on ad spend, I assume?
Give Facebook ads time for you to test how they perform.
Can you explain that metric for some folks?
It's looking at the revenue you make from your advertising efforts versus the amount you spent on those ad efforts. It's a basic formula. Revenue over cost will get you that ROAS, especially in eCommerce. Why Facebook is so effective is because you have an empiric way to say, “This is the amount that I've got.” If you have a 1 ROAS, you spent $1,000 and made $1,000, great. You might want something better than that because of your operation costs, taxes, and all that good stuff. It's usually good to partner up to figure out what that number is, and then try to work towards it based upon the products you have in your company. That's the gist with ROAS. It's that simple formula and there's a lot more you can do with it. That's all it is, revenue over cost.
Oliver, thank you so much for your insights. If readers want to get ahold of you, where can they find you?
The best way to get ahold of me is through email, so Oliver@Centaur-Consultants.com. I'm available on LinkedIn as well under Centaur Consulting Group. If you want to schedule a call or anything like that, I will send over a Calendly link to Amy in case anybody needs to talk about anything.
I want to thank you for joining us. Oliver, you have been amazing.
My pleasure. Thank you for the opportunity. It's great to speak on your podcast and I'm looking forward to being on the next one.
Take it easy, Amy.
Let me close this episode by saying thank you to Oliver. It's so interesting because what he had to share was enlightening, and it comes down to some basics. What are your goals? Grab your calculator, get started, and understand that maybe you do need some help with this challenging performance marketing channel. Luckily, there are experts like Oliver out there, but in the meantime, utilize some of the nuggets he shared to better equip yourself to stop wasting money with Facebook and start making money. As always, happy emailing everyone. I will see you next time.