The Big Six Framework: How We Lowered The Cost Per Lead By 80%
By: Josua Fagerholm
Tags: Digital Advertising, Advertising, Marketing, Digital Marketing, Facebook Marketing

The Two Most Common Problems In Advertising

The two most common problems in advertising are found on opposite sides of the spectrum: ignorance and overwhelm.

Ignorance

It’s not uncommon for advertisers to be unaware of all of the factors necessary for successful advertising. This tends to lead to overoptimization where you double down on one or a few areas of the ad campaigns while neglecting other perhaps more important aspects.

Overwhelm

On the other hand, advertisers who are aware of all the data, options, tools, strategies and tactics that exist, tend to become overwhelmed. This leads to paralysis where you stop executing and start spending too much time analyzing.

The Solution

How do you solve these problems?

First, you need to get a clear picture of the entire advertising landscape and all the factors involved.

Second, you need a process for identifying the single largest bottleneck, so you can focus your attention where it’s needed most.

And we’re going to show you how we can achieve both of these objectives.

Introducing The Big Six Framework

Based on years of failing, succeeding and learning, we’ve created a powerful framework that allows us to cut through complexity and consistently produce results for our clients.

We call it the Big Six:

The Simple Framework That Produces Staggering Results

Variables

Variables are basically all the components of effective advertising. All of them can be manipulated to improve performance. Depending on the audience, product, etc., some variables may be more important than others.

Mechanism

The mechanisms are the way in which the variables are manipulated.

Metrics

Metrics are used for diagnosing and tell us whenever there’s a problem with a variable. With relevant benchmarks and targets, metrics allow us to easily identify the largest bottleneck(s).

Note: Like all frameworks, this one is designed to simplify a complex reality. For best results, use with judgment!😊

All right, that’s enough theory! Let’s see how we used this framework for one of our clients to systematically lower the CPL by over 80%.

Applying The Framework

Planning The Campaign📊

We were approached by a company in the health and fitness space looking to acquire new members. Before working with us, they had tried to generate leads sporadically and with mixed results. Now they wanted to take a more structured approach.

First, we ran the numbers. Using previous experience and client data, we created benchmarks and targets for the metrics (CPM, Click Through Rate, Conversion Rate). This is a crucial step, as otherwise, you won’t be able to use the metrics as a diagnosing tool.

Hypothetical Target CPA Analysis

Second, we planned and prioritized our actions. We created a backlog of all the things we wanted to test and implement. This prioritization allows us to make sure we’re always using our time efficiently and not just doing busywork.

Knowing the numbers makes it easier to prioritize. For instance, we knew that it would be more challenging to improve the Cost Per Click (CPC) than the Conversion Rate. So we focused on the variable we thought was going to have the biggest impact: the Offer.

We created two identical campaigns and landing pages with two different offers, and launched the first ads.

Going Live🚀

After running the ads for a few days, things were looking.. not great! In fact, we had a CPL of just over $40, far above our target.

Instead of freaking out and rethinking the entire campaign, we analyzed the data and found the reason behind the high CPL: a lower-than-expected Conversion Rate. And since neither Offer was converting well, we knew there was a problem with the Landing Page.

By analyzing screen recordings from Hotjar, we were able to further pinpoint the problem: visitors were reading most of the content but leaving the page once they came to the contact form at the bottom.

We redesigned the form and made it shorter and easier to fill out.

Ready For Round Two🥊

With a new form, things were moving in the right direction and we were looking at a CPL of $26. We could now see a clear difference in performance between the two offers.

We still weren’t quite satisfied with the conversion rate, so we decided to go back and test a third offer.

New Targeting🎯

The new offer turned out to be the highest converting of the three and brought down the CPL to $12.

Both the landing page and the offer were now working, and the conversion rate was where we wanted it to be. We decided to shift our attention to the traffic side.

While we were focusing on improving the conversion rate, we also paid attention to the advertising performance as well. By looking at a breakdown of the demographics and geography of our audience, we’d noticed that some of the segments were underperforming, and we made a few changes to the targeting.

Note: While you should ideally only change one variable at a time, you want to constantly look at data and potentially revise your priorities.

The Final Touch🎨

The new targeting had a positive (but not huge) impact, and the CPL dropped down to just below $10.

We were confident that the ads were showing to the right people, and we could now focus on further increasing the CTR (Click-Through-Rate). The easiest way to do this was by capturing more attention through new and better ad creatives.

Note: The creative is often the most important variable and the thing we focus on first. Here it was last since we were building out the advertising funnel from scratch.

In Summary

With the new ad creatives, we finally managed to decrease the CPL to less than $7, which represents an 80% improvement from where we started. This meant that the client was now getting 5x the number of leads at the original cost!

80% Reduction In CPL

The fastest and straightest path to great results comes from understanding all the factors without letting it overwhelm you. Be systematic, patient and focus on what matters.

Good luck!