Raise your hand if you think FB Ads are a waste of money after the iOS14 changes. Or maybe you haven't given up entirely, but you're struggling to get the returns you once did. Or maybe, you've never even run a Facebook Ad because you don't really know what you're doing and you're afraid to screw it up.

Whatever your confusion or hesitation about FB Ads, today's episode is for you. Our guest today is Nicole Diedrich of Diedrich Marketing Strategies. A boutique Facebook Ads and Social Media Agency that has seen positive results for its clients even after the introduction of iOS14. Nicole shares why her agency has continued to see success for her clients while others are getting out of the game completely, simple Facebook Ad funnel you can use in your business no matter your budget, and she gives insight into what ad creative is performing for her clients right now.

What has it been like being an ads manager during the iOS14 update? How have you had to adjust your strategy?

The hardest part for me was there wasn't enough information when it was coming out. We weren't well informed to be ahead of the game. It was really frustrating to try to figure out how to do it all by myself, without any outside support. The people who are successful with iOS 14 right now are because we did the grind. We shed the tears. 

Granted, I was pretty lucky with our clients at the time being willing to work through all of that. And my previous strategy with ads made it so we didn't just completely dip. 

What we did was we really dove into tracking, which was the biggest thing that affected the backend of Facebook ads when iOS hit. 

Tracking became really difficult because they couldn't track things properly. It was impossible to tell whether a sale actually did come from an ad, because the customer opted out of our tracking. 

People were relying on the technology to do the work for them, frankly. And now the technology doesn't have all the information that it needs to do what it was doing before. So you need an actual strategist and marketer who's going to do the work for you.

It's definitely been a struggle and lots of turmoil. But at this point, it feels like a rainbow at the end of the dark tunnel. And it's so worth doing. Especially when you have people who have done that type of work that are gonna be able to set you up in a space where you don't feel scared, you feel confident and comfortable trying it out yourself.

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How are ads performing now we’re over the main hump of iOS14 

Right now, everything's working really well. We're averaging between two to five to six times for our clients, which means they're profitable. 

When it comes to your ads, I really want you to pay attention to if it's bringing you in money. Are you profitable? 

Ads are something that depending on the industry you're in can be super competitive. Or perhaps you’re not niched enough to be able to find those people on Facebook, but maybe you can find them on Pinterest or Tik Tok. So there's lots of other avenues. 

If you know how to do audiences well, you’re good with good creative and you have really great organic sales, then naturally, you'll see good growth with Facebook ads. 

That's something I've noticed with all of my clients who've done well. They have a really good organic following already, they have really good buyers already, and so when we move them to ads, it takes off.

What are some common threads among clients that are successful? 

It's a little bit of the chicken and the egg. We always recommend that you prove Product Market Fit organically first, but how do you do that if I don't have any traffic? 

What about your approach to ads is different? Why do you think you've continued to be successful when a lot of others have not been?

There's three things that make us really different, especially from those bigger agencies right now. 

1. How we track

I do everything and anything in my power to make sure that both us, and you, as a business owner, know where your sales are coming from. 

Organically, Google or Pinterest, are bringing in a ton of sales, so we may want to boost that with a paid avenue. 

Our tracking and our ability to go into every sale and see whether that came from an ad or another source? Yes, it takes time but it has been 100% worth it for our client retention. As well as allowing us to scale our clients advertising campaigns, I think with the iOS change has been the most difficult. 

2. How we target audiences through Facebook ads. 

So something that I've been doing since I started ads is called detailed targeting. We do tier two targeting, which is funneling people from your niche to make sure that every dollar spent on ads is going out and hitting somebody that could possibly be a customer. 

This is something that a lot of people and bigger agencies have struggled with, because they didn't have to do that before. They could just spend a lot of money, and the algorithm would figure it out. 

I've never been like that, because I started with really small brands with really small budgets and I had to make sure that I was doing my best to make them money. 

3. No limit on the campaign creatives that we create for our clients

If something's not working, I'm going to change it. That's not a thing for a lot of agencies—they put a limit on the campaigns that they create. And most of the time it's one and done. 

Every month they go in and check things and that's it. We don't do that here. I'm an ads manager every single day. Tweaking budgets, tweaking copy, tweaking creative. Our team is small but mighty and we make sure that we're making you the most money. 

That's where ads management becomes very time sensitive, or time consuming, because if you're not in it every day, you could be missing the opportunity to scale certain things or turn things off that aren't making your money.

What has been the impact of iOS14 on ads?

This update gave the user the option to opt out of tracking across their other web behavior. Facebook used to know when you visited other websites on the internet because it was tracking all of your behavior off of Facebook. 

Now, with iOS 14, the user has the option to opt out of that, which roughly 70% of people did, which makes it very difficult for the algorithm to work in your favor with so much data missing. 

Detailed targeting is based on the first part data that Facebook has about you as the user. Remember back in the day, when you used to put in information about you like your favorite TV shows and movies, what you do for a living, your birthdate, whether you’re married, and then those all eventually turned into pages that you liked? That is all first party data that Facebook can use to target you. 

That information is what you are accessing when you are using detailed targeting, which was a big thing when Facebook ads first started. Then it was all about spending a bunch of money and letting the algorithm figure it out. 

Now we have to go back to being skilled marketers who understand our audiences, which is where that detailed targeting comes back into play. 

It’s important to understand your reporting 

You don’t need to micromanage, but you do need to understand how people are managing your money. 

Ads managers need to know the customer lifetime value because this determines what that client can afford to spend to acquire a customer, as well as their product margins. Because you could be bringing in $1,000 but in reality, you're only making whatever your margin is on that. 

Revenue wise, it may look good, but if your margins aren't good, then you're not actually making money. 

I actually created a tool to help you with this, which you can get here. 

Know your numbers, make sure your ads manager knows your numbers and that you are approaching this from a scientific place. 

Why is it important to focus on acquisition?  

A lot of people transfer over to us because it's really easy to make people's numbers look good if they have a huge audience or a huge following, and you're just hitting retargeted customers. It's really easy to say I'm getting you five times your adspend, but 80% of those customers were already your customer. 

We really focus on acquisition. And as an eCommerce business owner you all know that acquisition is queen to fill your funnel. 

The only change we have made to the detailed audiences now is actually excluding customer lists, which is something that a lot of people aren't doing. 

Not doing that actually means that the ad hits people that are already your customers because they opted out of the iOS update and Facebook wasn't able to tell if they'd already been a customer or not. 

That’s a really simple thing to add in if you’re managing ads yourself. Every month or so, depending on how big your customer list is, go back and exclude past customers. 

Using tiers to get more accurate audience targeting

When you're doing detailed targeting, Facebook actually allows you to tier things off into three different tiers. So I base those off the interests of your company.

I start with broad audiences as my first tier, which is about 60+ interests and then I create my detailed audiences from there. 

Tier one 

Let's say you're a boutique owner, your first tier would be based on those interests, like other boutique owners or other shopping spaces that your customers probably go to. 

Tier two 

The next tier is about who. So who is your customer? Are they moms? Are they aunts? Where are they going to be located on that? Are they engaged, single, married? These are the demographics about them. 

Tier three 

The last tier is their hobbies and interests, which filters it all down into a big funnel. 

What numbers should it say it's going to reach? 

For a detailed audience: I usually aim to hit 20 million plus. If it's below that it might be a little too small, which might result in spending more than you have to on new acquisition. 

For a broad audience: I this to be around at least 75 million to 125 million. It seems like a lot of people, but trust me, depending on who you're hitting, it's worth it and it works well. 

Are you still using lookalike audiences at all?

The answer is yes, but only for certain clients. Lookalike, audiences are great if you have a huge email list, which is why emails are so important. 

If you have over 5000 email subscribers, you're going to see some results. It's just going to take longer, which means less spend for a longer period of time. 

Some of my current clients have hundreds of 1000s of followers on social media, and they have really big email lists so we're able to use lookalike audiences. 

The only thing that has changed is that I use 5%—10% instead of 1%—3% lookalikes anymore. Those are the only ones that seem to be working, just because the volume has cut down so much from the first party data. 

What's a good 2022 ad strategy for someone who doesn't have a big budget?

You have a very specific strategy for creating that warm audience that you can remarket to, and then build a lookalike audience off, which are called awareness campaigns. 

Normally we lead new customers to a website with a pop up, which usually captures the customer’s email in exchange for a discount code. 

A lot of people have different views on discount codes. All of my current clients do not use them on cold acquisition, we only use them on warm acquisition. Because if I can get somebody in cold for no discount, that's a win. 

Awareness ads are actually way cheaper. They allow you to reach your target audience while also filling up your ads manager with actual data, which is probably the biggest, most important thing that you can do when you're starting ads. 

Awareness ads are super cheap because they’re based on link clicks or landing page views. They bring in customers just like you would for a conversion ad but we're not asking them to necessarily take action. 

How awareness ads work

Let's say you’re a skincare product and you're wanting to help people become aware of why they should be buying this product, you can lead them to a blog post which explains why they should be wearing sunblock in the wintertime, for example. That gets them on the website, which gives you first party data and that is something that Facebook can then integrate into its system. From there, it can retarget those people with the next part of your funnel within your ads campaigns. 

The next part of the funnel could be asking for them to sign up for the email list or giving them 20% off when they sign up. 

This method allows you to bring new people into your funnel for super cheap who you would have reached without ads. It qualifies them as warm potential customers and then bam, you can sell to them on the back end. 

Do Facebook ads have to be super expensive?

A lot of people assume that Facebook ads have to be super expensive when you're starting out and that you have to be ready to just invest 1000s of dollars upfront and that's not true. 

Your main goal is triggering your ad account to gain as much data as possible so that it can start converting better. The more first party data you have, the easier it is to hit the proper customers. 

When you are creating these awareness ads, and you're really just putting interesting content in front of your ideal customer and then when they take the action on the ad by clicking the link and going to your website, that becomes Facebook's first party data, which allows them to mark that person as someone who is interested in what you have to offer. This creates a warm audience of people who are interested in what you have to say. 

From there, maybe you're selling on the second ad or maybe you're not selling until the third ad. It depends on the complexity of your product, the price and how long it takes someone to make a buying decision about your product.

You can just have this shit running all the time, filling up the funnel. I know it can feel like if these ads aren’t making a sale, then you’re not making money, but think of it as spending money to buy data. It's no different than the time, energy and effort you spend creating organic content for social media. 

Think about customer lifetime value. Let's say, on average, someone spends $500 with you, how much would you be willing to spend to get that person to come in and shop with you? You'd probably pay a pretty penny. It's okay to spend a few bucks to get your content in front of them and get them into your orbit. It is by no means a waste.

What I really love about ads is the likelihood of them buying over somebody coming to your site from social media is way higher. 

What does a good ad look like? 

It really depends. For our boutique clients, carousels and five second outfit videos do well. Sometimes not having people's faces in the creative can be surprisingly effective because people can see themselves wearing that. So we do a lot of those carousels, where it's the full outfit, but the face of our model isn't in it. 

Something else that we've been noticing that's been working really, really well is instant experience ads, which is kind of creating a landing page within the ad where people can buy right away. 

When it comes to user generated content, it does work, but it works better for beauty products or things that you put into your body like treats, for example. I work with pet brands and user generated content is also really good for them. 

Another trend emerging is flyer-type Instagram posts. Those seem to catch people's attention, keep them longer and make them take action a lot quicker than if we were just posting an image of an outfit. 

Sometimes they include this or that questions, which makes it look like a social media post that they can engage with, as well as instantly go and buy from. 

What are the most successful store hosting sites 

People who are really successful right now have Shopify sites because it is really hard to track with Wix or with WooCommerce or with common sold sites. 

I urge you to consider Shopify in 2022. It is an amazing platform, and it will help you know your numbers so much easier. Even with Google Analytics, it's hard to connect fully with some of those sites. 

Shopify and Facebook work together to create a tool to help combat iOS 14 and to get the tracking from Shopify to Facebook as your first party data. Things happen on Shopify and Shopify sends that information over. 

#1 takeaway from this episode 

Facebook ads still work, if you know how to track them properly. If you know how to target your customers, you will see success with them, whether you're spending $100 a month, or $100,000 a month.

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