This is a follow-up to Wednesday’s email where I was talking about giving your readers some options in your welcome email to find out what they’re interested in.

When I work with 1:1 clients who have got a decent number of sales through social media, their next goal is to start making money by selling their product with ads.

Spending money on acquiring customers brings a whole bunch of disciplines that you don’t recognise when you’re selling on social.

One of the most important is the concept of payback.

When you make a product and sell it on social, you just look at how much effort the product took to build and promote, and how long it takes to bring in the money to justify it. 

On social, payback is more of a “did it or didn’t it?” question.

With ads, you need to keep that calculation rolling to see how long it’s taking to get your money back from your ad spend.

It’s a question of “not if, but how fast?”

The first thing it pushes you to do is to have an early campaign that actually makes money rather than just building goodwill for big, but sporadic launches.

It also gives you a few options.

If you don’t make back your money straight away – when they go through your initial funnel, you have the option of just adding and improving the offers in the funnel until you sell enough to break even.

Because you don’t have that trust built up yet, you need to work a lot harder on figuring out what people want to buy, and selling a relatively low-priced product to recoup your ad costs.

(This is why moving to ads in a big way isn’t a good idea until you have a few products at different price points.)

Usually your first product won’t make much, if any money after ad costs, but the aim is to build a qualified list of buyers who will buy through emails and simple landing pages that cost you next to nothing per sale.

Your aim should be to pull this number down to under 30 days. That means that if you spend $1000 on ads on day 1, by the end of day 30 you should have at least $1000 in sales in your account.

At that tipping point, something magic happens.

All of a sudden the cash from your ads is coming in before the credit card for the ads is due, and you have a bottomless pit of money to scale up.

You’re shamelessly using the bank’s money to fuel your business. You’re not paying any interest and if you play the game right you can get a stack of air miles or cash back to play with as well.

If you want this to work at scale, you need a few things in place:

1. A low cost, high value product that people will buy without needing to build a lot of trust.

2. Some upsells to raise the value of the first purchase.

3. A product that solves whatever problems are left after they’ve bought the first one. Your second stage product is where the profit starts to come in.

If you’ve never sold with ads before, you can be forgiven for thinking that it’s just a case of taking a successful product that you’re selling through your social channels and “doing some marketing”.

Instead, you need to move into a mindset of finding offers that people already want, and don’t care who you are when they buy them.

Certain types of product lend themselves to this and I’ll talk about them in another email.

Hopefully this has got you thinking ahead to what it really takes to turn the corner into a business where you don’t have to be a slave to the social algorithms, and turn your business into a legal bank robbery.