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Before we dive into doing ads, we first have to understand the theory of it all. When you do, the practical stuff comes much easier.
The first thing you have to know is the funnel. This funnel is a big picture vision of how ads and audience targeting work, as well as why sending the right message (ad) at the right time to the right people is important.
You must always go back to this fundamental theory. Soon it’ll become second nature.
A few things I want you to notice about the funnel:
- The top of the funnel (TOF) is always going to be wider than the bottom of the funnel. Your BOF audience size is always going to be limited by how many people are in your TOF. And naturally, some people from the TOF just won’t move into the BOF
- The groups of people you’ve selected to bring into your funnel is called audiences
- The TOF audiences are usually cold traffic – which means people who don’t know you/have never heard of your brand before
- BOF audiences are warm/hot traffic – people who know your brand
- The different “temperatures” of traffic indicate how likely a person is to buy your products. The difference between warm and hot could be a person who has visited your site once vs another person who has visited your site three times and added something to their cart. You MUST be aware of this because hot traffic is much more likely to convert into a sale. And you can save money and produce higher ROI by showing specific ads to hot hot hot traffic, and different ads to warm traffic
- The way you speak to a TOF audience and BOF audience is quite different. Don’t make the mistake of showing BOF ads to TOF audiences
- There can be a middle of funnel, but it’s usually not so prevalent in handmade/physical product businesses. We can ignore MOF
- The TOF will always require the largest % of your ads budget (you will be spending most of your money in TOF), while BOF is cheap and can give you the best ROI. There is nothing wrong with this, it’s just how the funnel works and you have to be prepared to expect that
- The goal is to get people moving from the TOF to BOF to finally, a sale. Chaching!