Everything I've Learned Spending $30M on YouTube Ads | Tommie Powers Interview
Summary
TLDRIn this insightful interview, Nathan Chan, CEO and founder, discusses mastering YouTube ads with a self-proclaimed 'YouTube ads goat' who has spent over 30 million dollars on the platform since 2012. The conversation delves into the power of YouTube as an advertising medium, the importance of creative hooks, messages, and calls to action in ads, and the strategy of viewing ads through the lens of customer lifetime value. The expert shares his journey from Google ads to YouTube, emphasizing the platform's potential for businesses of all sizes and the necessity for resilience in entrepreneurship.
Takeaways
- 📈 YouTube boasts two billion active users per month, making it a vast platform with a high potential audience for any business.
- 🎥 The power of YouTube ads lies in their ability to replicate the global impact of TV, but in a digital, accessible format across multiple devices.
- 🛍️ Diversification of ad spend beyond Facebook to platforms like YouTube can be beneficial, especially for businesses looking to expand their reach.
- 🚀 Starting an online business requires resilience and the ability to adapt, as illustrated by the interviewee's transition from management to online marketing.
- 💡 Creativity in ads should include a strong hook, clear message, and a direct call to action to effectively capture the audience's attention within the first few seconds.
- 🔄 The concept of 'open loops' is used in advertising to create intrigue and maintain viewer interest, similar to cliffhangers in TV shows or movie trailers.
- 📊 For scaling ad campaigns, starting small and learning quickly is essential before increasing the budget for greater impact.
- 💰 Understanding unit economics and customer lifetime value is crucial for determining how much can be spent on acquiring a customer through ads.
- 📉 The mindset of learning from ad spend, rather than immediate profitability, accelerates the path to successful advertising strategies.
- 🔑 The key differences between YouTube and Facebook ads include the format of creative content and the user behavior on each platform, requiring tailored approaches.
- 🌐 The future of YouTube advertising is promising with increasing global internet adoption and the potential for more businesses to leverage its capabilities.
Q & A
What is the significance of having two billion active users per month on YouTube for advertisers?
-It means that no matter who the target audience is, they are likely on YouTube, providing advertisers with a vast potential reach to connect with their desired demographic.
Why did the interviewee start using Google Ads and affiliate marketing?
-The interviewee started using Google Ads and affiliate marketing in 2007 as a way to provide for his family and find success online after not achieving success with other methods.
How did the interviewee's experience with eBay selling in a pawn shop influence his online career?
-The experience showed him the potential of making money online through selling items like a broken camcorder for a profit, which sparked his interest in the internet as a viable way to generate income.
What was the turning point for the interviewee that led him to specialize in YouTube ads?
-The turning point was when he started an agency and began running Google Ads. His success with clients like Kevin Kergansky, who saw significant growth after implementing YouTube ad strategies, led him to specialize in YouTube ads.
What is the interviewee's perspective on the power of YouTube ads compared to traditional TV advertising?
-He believes YouTube ads are powerful because they take the concept of TV advertising and expand it to digital formats that are accessible on multiple devices, allowing for a broader reach and more engagement.
How did the interviewee's strategy of using YouTube's external link annotations contribute to business growth?
-By using external link annotations, he was able to embed clickable links within videos, which reduced viewer guard and directed them to the client's website, leading to significant business growth for clients like Kevin Kergansky.
What is the interviewee's advice for businesses that are not yet making six figures?
-His advice is to focus on one advertising platform and not spread themselves thin until they have gained some traction. Diversification should come after achieving a certain level of success.
What are the key differences between running Facebook ads and YouTube ads according to the interviewee?
-The key differences include the format of creative messaging, the user behavior on each platform, and the intent behind user interaction. YouTube ads often require a stronger hook and message baked into the video itself due to the platform's nature of seeking information.
What is the interviewee's C3 Formula and why is it important for successful advertising?
-The C3 Formula stands for Creative, Campaigns, and Conversions. It's important because these three elements are crucial for any advertising platform. They represent what you're saying, who you're saying it to, and how you're getting them to take action.
How does the interviewee define 'margin' in the context of advertising and why is it important?
-He defines 'margin' as everything it takes to deliver the promise made when taking someone's money. It's important because it dictates how much an advertiser can pay to acquire a customer while still being profitable, considering the potential for future sales to the same customer.
What mindset does the interviewee suggest for businesses when it comes to spending on advertising?
-He suggests a mindset of learning and investment. The more a business spends on advertising, the faster they learn what works and what doesn't, ultimately leading to success through iteration and optimization.
Outlines
🌐 The Power of YouTube Ads
The paragraph introduces the concept of YouTube's massive user base and the potential for advertisers to reach diverse audiences. It highlights an interview with Nathan Chan, CEO and founder, discussing YouTube ads mastery. The speaker emphasizes the importance of understanding the platform since its inception in 2012, after experiencing a significant loss from Google Ads. The narrative transitions into the journey of building an agency and leveraging YouTube ads for various clients, resulting in substantial growth for businesses like Organifi and others, showcasing the transformative power of YouTube advertising.
📈 Scaling Business with YouTube Ads Strategies
This section delves into the speaker's experience with scaling businesses using YouTube ads. It discusses a specific strategy involving uploading long videos to YouTube and utilizing recommended ads to drive traffic, which significantly reduced viewer defenses due to the platform's casual nature. The strategy incorporated external link annotations to direct viewers to the speaker's website. This approach was successfully replicated across multiple clients, leading to substantial growth in revenue. The speaker also touches on the importance of having the freedom to experiment with ad strategies and the role of results in gaining clients' trust.
🚀 Early Days of YouTube Advertising and Market Potential
The speaker reflects on the current state of YouTube advertising, comparing it to the early days of Facebook and Google Ads. He suggests that many businesses have yet to fully utilize YouTube's advertising capabilities, often due to misconceptions about the complexity of creating video content. The paragraph highlights the potential for growth in the YouTube advertising space, with the speaker estimating that only a fraction of Google Ads users are currently running YouTube ads. The speaker also discusses the challenges Google faces in encouraging more advertisers to adopt the platform.
🔍 Navigating the YouTube Ad Ecosystem
This paragraph focuses on the unique aspects of YouTube ads, emphasizing the importance of understanding the platform's user behavior and the differences between it and other advertising channels like Facebook. The speaker discusses the need to adapt ads to suit YouTube's user intent, which often involves seeking information rather than mindless scrolling. The speaker also shares insights on the importance of diversification in advertising strategies, suggesting that businesses should focus on one platform until they achieve significant traction before considering expansion.
🎯 Targeting and Adapting Ads for Different Platforms
The speaker discusses the importance of tailoring ads to fit the platform on which they will be displayed. For YouTube, the speaker suggests that ads need to be self-contained, as they do not have the supporting text that Facebook ads have. The paragraph also addresses the misconception that Facebook ads can be directly transferred to YouTube, highlighting the need to modify the creative to match YouTube's ecosystem. The speaker advises businesses to focus on one advertising platform until they have a solid foundation of success before diversifying.
📊 The Economics of YouTube Advertising
In this section, the speaker discusses the financial aspects of YouTube advertising, emphasizing the importance of understanding margins and return on ad spend (ROAS). The speaker encourages businesses to consider the lifetime value of a customer and the potential for future sales when determining how much to spend on acquiring a customer. The paragraph also touches on the importance of delivering on promises made during advertising to ensure customer satisfaction and retention.
🎬 The Art of Crafting Effective YouTube Ads
The speaker outlines the key components of an effective YouTube ad: the hook, message, and call to action. The hook is crucial for capturing attention within the first five seconds of an ad, while the message conveys the ad's content, and the call to action guides viewers on what to do next. The speaker also discusses the importance of creating a sense of urgency and using strategies like open loops to keep viewers engaged. Additionally, the speaker talks about the need to understand the target audience's mindset and tailor the hook accordingly.
📈 Learning Through Scale in YouTube Advertising
This paragraph discusses the relationship between ad spend and the speed of learning in the context of YouTube advertising. The speaker suggests that starting with a small budget is possible but acknowledges that higher spending can accelerate the learning process. The speaker emphasizes the importance of iterative learning and adjusting strategies based on what works and what doesn't, rather than focusing solely on immediate profitability.
📊 Understanding Customer Acquisition Costs
The speaker delves into the importance of understanding the cost of acquiring a customer and the potential for future sales. The paragraph focuses on the concept of 'true margin,' which is the amount left after all costs associated with delivering on the promise made during advertising are accounted for. The speaker encourages businesses to consider the long-term value of a customer and the potential for additional sales when determining how much to spend on advertising.
🌟 Inspiring Insights on YouTube Ad Strategies
In the final paragraph, the speaker shares his enthusiasm for the potential of YouTube advertising, highlighting the platform's global reach and the opportunity for increased adoption as more of the world connects to the internet. The speaker also expresses a desire to understand the thought processes behind successful product development and customer loyalty, citing Steve Jobs as an entrepreneur he would like to have dinner with to gain insights into these areas.
Mindmap
Keywords
💡YouTube Ads
💡Agency
💡Google Ads
💡Creative
💡Campaigns
💡Conversions
💡Margin
💡Customer Lifetime Value (CLV)
💡Hook
💡Call to Action (CTA)
💡Open Loops
Highlights
YouTube has two billion active users per month, making it a vast platform for advertisers to reach their audience.
The interviewee has spent over 30 million dollars on YouTube ads since 2012, showcasing his expertise in the platform.
Diversifying ad spend beyond Facebook to YouTube can be beneficial for businesses struggling with Facebook ad costs.
The interviewee's first online success came from Google Ads and affiliate marketing, which was crucial after his Google account was shut down.
Starting an agency allowed the interviewee to leverage his skills in traffic and numbers, leading to success in the digital marketing field.
YouTube's power as an advertising platform is compared to the impact of TV, but in a digital, accessible format across multiple devices.
A strategy involving uploading long videos to YouTube and using recommended ads was highly successful for a client, increasing their revenue significantly.
The interviewee has helped various clients, including Organifi, to catapult their brands using YouTube ads.
YouTube ads are still in the early stages of adoption compared to Facebook ads, presenting a significant opportunity for advertisers.
Small to medium-sized businesses may not be taking full advantage of YouTube ads due to misconceptions about the complexity of video advertising.
Understanding the different user behaviors on Facebook and YouTube is crucial for effective advertising on both platforms.
The interviewee recommends businesses not to spread themselves too thin and focus on one advertising platform until they achieve significant traction.
Key differences between YouTube and Facebook ads include the importance of the video as the primary message carrier on YouTube.
The interviewee's C3 formula focuses on creative, campaigns, and conversions as the three key elements of successful advertising.
Creating a hook in YouTube ads is essential to capture attention within the first five seconds before viewers can skip the ad.
Open loops in advertising create a desire in viewers to learn more, similar to the effect seen in soap operas and movie trailers.
Starting with a small budget on YouTube ads is possible, but larger budgets allow for faster learning and optimization.
Margins in advertising should cover all costs associated with delivering on the promise made to the customer during the sale.
The interviewee emphasizes the importance of resilience in entrepreneurship and the potential power of YouTube ads as a marketing medium.
Transcripts
two billion active users per month
like your audience is on there doesn't
matter who they are they're on youtube
it's just a matter of can you get in
front of those people
[Music]
hey guys welcome back to another
interview nathan chan here ceo founder
make sure you give us a thumbs up for
this video if you want to know how to
master youtube ads in 2021 or beyond
we've got the youtube ads goat he's
spent over 30 million dollars on youtube
ads
he's been using this platform pretty
much since inception since 2012.
so if you want to know how to diversify
your facebook ad spend you're getting
killed on facebook ads now this guy is
the best in the business
you have to watch this interview alright
tommy thanks so much for taking the time
to speak with me today
the first question i ask everyone that
comes on is how did you get your job
man 2007 i was trying to find a way to
provide for my family and
i always knew the internet was a way and
i didn't get any success until i started
doing google ads and affiliate marketing
that's really what allowed me to have my
first success
you know online buying ads and
everything like that 2009
2010 google shed my account down that
was about
90 95 of my income at the time
so it's pretty devastating and so a
buddy of mine was like
i got these guys that want you to run
their ads for them and i'm like why
would i run their ads
you know and uh you know long story
short he was like you know they pay you
it's like an agency thing
that's how i got in the agency game i
need to make some money and so
i kind of was good at this traffic thing
and the numbers and everything
and i was able to you know these guys
was like we'll pay you to do ours
and i learned this agency game then i
kind of been off and on
as an agency slash media buyer slash
consultant
ever since yeah well so since 2009
you started your agency gotcha and um
yeah tell me about kind of how
how did you get started around i guess
getting online like what what what what
were you doing before that
99 to 2007
i was in management that was me really
my career you know i worked at walmart
for quite a few years
um i actually joined their management
training program
and then uh i had a bunch of other
management jobs and then i ended up
working at this company called cash
america they owned the
most number of pawn shops of any company
in the world it ended up being a really
uh life-changing uh scenario for me
i learned a lot in that business about
myself
one thing i did do in that pawn shop was
ebay they were not aware of ebay
and i was aware of ebay and i ended up
having this idea
i bought a camera of camcorder back then
camcorders with the rage
i bought it for 20 dollars but the
problem with it was the door was
jammed so you couldn't put a new tape in
or get it out right
i sold it on ebay for 88 dollars that
was like whoa
what's going on so i just started doing
a bunch of stuff with ebay at one point
i think i was making about
five or six grand of money on ebay but
when i left that company
that was my product like that's how i
got
my product and because i knew all of
these managers at other stores and
things like that
uh when i left that job there went my
supply chain
basically right but that was another
indication for me that the internet was
like all right i know i can make
money on this internet so fast forward
like i said 2007
i'm not just you know i mean there's
several instances where i knew the
internet
was the way and i'm just gonna go
hardcore with this internet thing
and i'm gonna make it work i'm gonna
figure it out one way or the other i'm
gonna make it work
and here we are yeah well crazy man
thanks so much for sharing so
um you said that in 2009 you started
your agency you started buying
traffic you're running google ads um
now you really specialize in youtube ads
why do you think youtube ads are so
powerful you know if you really look at
tv and the way it changed
you know global the global culture
globally right
because you gotta understand like you
and i on the other side of the world
from each other right now
but even prior to the internet i
knew what was going on on your side of
the world you knew what's going on on my
side of the world why because
tv prior to tv i mean you had radio but
you didn't have the visual
right so it's the same idea you're just
putting tv in a digital format
you know and and it's accessible on
multiple devices
is really what video created it
basically took tv
and expanded on it and that's why you
know it's so powerful
i mean average people walking around
with three or four connected devices on
them so
it's just allowed us to connect with
people on all of those devices in your
car on your arm
you know glasses phones
you know tablets everything and you know
you can hit someone with audio
video the whole thing with it you know
and it's just
youtube it gives you their capability
unlike anything else
that really is out right now yeah i see
so um i guess you've had a lot of
experience running youtube ads
uh you know we you've been doing it for
over a decade now
um so you're one of the ogs uh
can you tell us some of the examples or
some of the results or some of the crazy
things you've done with youtube ads for
some of your clients
this guy kevin kergansky to break up
doctor
he was kind of the first person that
gave me the freedom to kind of do
whatever i wanted
and so i had this idea that he
at the time he was running this vsl it
was like an hour and 10 minutes
so my idea was let's upload it to
youtube
let's buy the little recommended ads
over the recommended videos
point black to that video on youtube
because the psychology of them being on
the youtube platform
would bring their guard down and
at that time youtube had something
called external link annotations with
you connect your website to your youtube
channel and you can embed a clickable
link
right inside the video at any point and
they can live as long as they want it
and that was my idea and i just thought
man this could be so amazing and this
guy was like if you say
i don't know but whatever you say and
you know we basically
probably within six months took him from
five grand a month to a seven figure
business run rate
uh in a really short amount of time so
naturally i was already working with
other clients who
wasn't giving me the freedom but that
allowed me to go to these other people
and say
this is what i'm doing for this client i
want to do this for you
and now instead of them holding me down
there was really more
because i had results to show them give
me the opportunity
and so i ran that play like three or
four times
uh back to back it just was going crazy
so kevin you know really
you know was the catalyst for that
matter of fact
uh i ended up working with this company
organifi
and we ran that same place initially
with their youtube ads
and once again it hit it's just
out of the gate it just and that company
you know i was able to help them with
youtube
really catapult that brand up and uh so
i ran that play
hard man i don't even remember how many
times
with clients maybe about seven eight
times
uh i taught a lot of people that
strategy
that was really the kind of the primary
thing that i was teaching when i first
started teaching youtube
ads was this this strategy so a lot of
other people made a lot of money i don't
i didn't track
everyone but i also had clients that i
talked and not necessarily ran it for
them that i coached them or consulted
for
that did that as well but oh man that
was amazing
um so that's you know probably a good
of what kind of led to this whole oh
gee if you will right i was teaching
this no one was talking about it
and that really opened up a lot of doors
for me so fast forward you know
uh 500 startups with vc
firm they ended up reaching out i did a
bunch of work with them i worked with a
lot of their startups
um fast forward i decided to become an
investor
um and that didn't go that well i
realized that
my pockets wouldn't be enough for that
so fast forward 2019
the current agency that i'm running
probably really late 2019 we kind of
pivoted purely to youtube ads but prior
to that we were doing a lot of stuff
facebook ads building funnels who's
doing it all
uh but we've just seen these these
opportunities with youtube
you know kind of continue to um
pop up and so we just kind of you know
switched gears to that
one of our clients who was doing legion
we basically was able to take them on
youtube
really just blow that up three four five
thousand dollars a day from scratch
another one of my clients robert
blanchard
uh we have robbie uh basically go to you
know eight figures
uh these are current things right so
there's a lot of
other things in there that i can't
remember but that'll give you you know
some ideas from
kind of the beginning kind of up to now
if you will yeah
love it and um yeah like you can use
youtube ads for
not just lead gen info products but also
e-commerce
service based business sas you've done
it all right
for sure or or i've coached or consulted
i'm very selective about who we actually
run the ads
the full done for you but i've done
quite a bit with companies who
you know want to run their own and they
just need the right game plan the right
blueprint you know
the right playbook if you will so i kind
of help them put that together and now
i've had every part of the spectrum you
can think about
fascinating so let's go a little bit
deeper on youtube ads
um you know we talk to some of the
smartest marketers
fastest growing companies founders and
a lot of people are saying you know that
youtube ads
is kind of like it's still early days
comparative like early days facebook ads
or
uh you know adwords google ads you know
i like buying traffic there and
i'd love to get your take i mean i think
a lot of people
assume that um
it's hard they also assume that
you know because you need video that
they overthink you know creative
because you know that that is a unique
factor about youtube is that you
only can run video so
anybody that knows any of the smartest
guys
that are really doing numbers buying ads
blowing their business up whatever level
of spectrum that they're on but they're
really
understand paid advertising
a lot of times the video is intimidating
because i think people overthink
what they need for that and the reality
is
it's a lot simpler than a lot of people
so for that reason i feel like
a lot of companies are not taking
advantage of it
then you kind of got small to
medium-sized businesses and i would say
honestly up to 50 million dollars a year
revenue you got this huge bucket of
companies
that are that are just you know they
don't have the resources or they don't
think that they have the resources or
there aren't agencies that are offering
you know creative services
along with the advertising to kind of
close that gap
because maybe they don't have the
capability to produce
but you know maybe they don't want to
bite it off
but it's really not as hard as they
think but i get it it's like another
thing i got to keep up with right i'm a
business owner i already got a gazillion
things and
a million hats that i'm wearing that's
another thing that i'm i don't know if
i'm ready for that right
so i understand the thinking but you
know it's
it's just i just feel like people aren't
really taking advantage of it yet
because they telling themselves so many
reasons why
they aren't ready and that's why i think
it is still kind of early days because
you know the number of advertisers on
youtube i don't know the exact numbers
but i'd imagine facebook probably got
three
to four times the advertisers than
youtube
and i would imagine this is me i don't
have any data to prove this is just my
opinion
i think probably only 30 of people with
a google ads account
that are running ads on google are
actually running youtube ads
i've had conversations with reps at
google who say you know
getting other advertisers to adopt
youtube
is a challenge it has been a struggle
but the company
is putting a big focus on particularly a
getting advertisers already using google
services to adopt youtube
and then getting other advertisers onto
the platform that may not
may not even be running youtube maybe
they're just running google so
that's kind of where i'm getting but
this is my estimation i think about a
third of them uh
aren't doing it and then you know i
would say
facebook just got way more people
advertising facebook versus
youtube now in terms of google as a
whole
there are a lot of advertisers on google
but
i would imagine that maybe maybe a third
of them
are actually running youtube ads so
that's kind of what
my that's my opinion again there's no
facts to support that
that's just what i think that's really
interesting um
because yeah when you think about it uh
you know everybody's running facebook
ads everybody you know
there's a there's an aura like you know
facebook ads can change the game
and then there's a lot of people from
old days you know early days that you
know a lot of businesses running
uh google ads you know using adwords um
to run google ads through search
right um so i'm curious
when it comes to youtube ads like what
about
you know your niche does it work for any
niche what what
like yeah i've said this a thousand
times by now but it's
two billion active users per month
like your audience is on there you know
what i'm saying like
it doesn't matter who they are they're
on youtube it's just a matter of can you
get in front of those people
and with all of this uh mechanism that
they give you for targeting
you can absolutely isolate specifically
who you want to reach
so they're on there it doesn't matter
what business you're in if you got
something to sell
there are people who are on youtube
that's buying whatever you selling
yeah i didn't realize it was that big um
so yeah but youtube like i use youtube
all the time
i'm always using it to learn things i
love searching on there
um so look i think there's a massive
opportunity that's why we're excited to
speak with you also partner with you as
well to teach one of our newest programs
but
let's talk about like facebook ads you
know versus youtube ads because
you know at founder we we spend a lot of
money on facebook ads
um you know we haven't cracked youtube
ads yet we're excited to really get into
it ourselves
um but i'm curious you know can you just
take your facebook ads if you're running
them right now because a lot of people
are a lot of people watching this
like can you just take them and then
just run them on youtube ads does that
work
you know i try not to say things don't
work because like everything could
work if you got you know the right
pieces together but
but i've seen it work but it's just the
probability is low
and um typically the way i
describe it is that when you're running
facebook ads
instagram you know whatever you know
you're getting
especially if you're running video uh
you also have the post area above the
video
that makes up your creative so your
creative is not
just video it's video plus whatever
you're saying in your post area text
combined together so if you just are
running video
on facebook and you just stick that on
youtube you lose the context of the post
area
right that's where i think a lot of
people get it wrong
and that's why i think the probability
is a lot lower because you do got to
somewhat modify
but the message is the message if you
got a good message
that's working on your facebook ads very
likely is gonna work on youtube if you
get the same audience targeting
you just gotta modify it a a tad bit
to match the ecosystem in which you're
trying to communicate
and with facebook you have image and
text or if you're running
video you got the video and post area
text
that is your creative and it's not just
the video
so you have to keep in mind that you got
to contextualize those both
together to be able to deliver that same
message effectively
on youtube i see so
i'm curious is it enough to just run if
you're if you're a business
uh or you you know you're starting a
business you want to start running ads
is it enough to just run ads on facebook
or do you believe you need to be
diversifying because
that's kind of what we're hearing in the
community that's what people are
starting to say i'd love to hear your
take
i do recommend diversification but i
also
i mean look you know we talk about
youtube people know me for that we're
having this conversation but
i also like to level with people and be
honest with them
if your business isn't making six
figures yet
stick to one thing don't try to you know
i see
too many people you know spreading
themselves thin
before they get any real traction if you
haven't gotten traction in your business
you should not be trying to do multiple
things because
they are two different animals i mean
that's just to be true
um they're not wildly different from
each other
but they are two different animals and
they take slightly different approaches
you know 70 80 percent of the stuff we
do
is the same thing we can do on facebook
on youtube
you know but there is a 20 to 30 percent
of it that's
gonna be slightly different for that
platform and so what happens is when
you're
you're trying to get traction you're
spreading yourself out then
when reality is you put all your focus
in you know
uh uh limit your focus you know
until you get to a point where you know
diversification
typically i say you know if your
business is doing you know
i would say a couple of six figures two
or three hundred k a year
you're primarily doing that through your
facebook ads
you should probably start thinking about
diversification because you're probably
getting some traction now you know
you don't make a couple hundred grand a
year
just playing around like typically you
found
you've hit on something uh to get to
that level
so you're definitely onto something at
that point and you probably have
something you can turn into
you know a bigger business so that's
when the time really wouldn't be
thinking about it but on your way there
i would say pick one you know i know
people that you know start with youtube
ads
you know that's their thing they love
video they are they already
you know kind of into the content
creation mode and shooting video
so you know you can also start with
youtube ads but
i wouldn't recommend trying to do too
many things
until you get a bit of traction yeah no
look i respect that
um i'm curious could you tell like just
for the audience that are not familiar
like what do you think the key
differences are
between facebook and youtube ads i
mentioned before
that with facebook your creative message
is a combination of you know the
image in the text or the video in the
text
in your post so that's a
key distinction right there that
when you're delivering a message to your
audience because that's what your
creative is
in order to modify in order to deliver
the same message effectively
you don't have you just have video you
don't you don't you don't have
that other stuff right i think the other
thing is that with youtube
it's almost like uh an alley hoop if you
want to think about it right it's like
the video is almost like the guy who
talks in the ball up
you know if you will right your video
want to be almost like an alley-oop
you're baking a bit more into your
messaging in order to pull that off
so that by the time they get to your
landing page you know
that's you know kind of where you bring
it home now obviously if you have a
high ticket high price product you're
going to need multiple touch points i
mean this is what it is
but if you talking you know 200 or less
i mean you can do a lot of damage you
know right from your message
to your landing page now once you get a
three four five hundred thousand two
thousand dollar
five grand that type of stuff i know
guys selling twenty five thousand dollar
stuff
you know you're gonna need you're gonna
need multiple touch points so you're
gonna need to get them on a phone call
closed type situation but um typically
we're trying to bake a lot more into
that messaging
and your landing pages are actually a
lot
simpler versus with facebook you see a
lot of long form sales letters and
you know you see a lot of you know that
type of stuff whereas
uh you know because you're trying to
deliver a message to get them to convert
well we just take a lot of that and we
make it into our video created
it's kind of the way we think about it
so i think that's a key distinction
um and then i think the third key one
would just be
you know evaluating isolating
you know because it's a different
behavior type someone's on facebook
they're scrolling
so your focus has stopped the scroll so
i went on youtube
you know um 70 of searches on youtube
start with how to so people are
searching for information
so it's a different type of intent so
you got to evaluate
them different and it's not necessarily
an easy thing to do
just to be honest but you have to try to
isolate them and separate them if you're
trying to
compare apples to apples behavior from
and youtube you're probably just looking
at your data all wrong so that's another
key point is just
understanding the type of behavior from
one versus the other right even on
instagram like they're scrolling
right they're not no one's logging on
the facebook well maybe a few people are
but
98 of them you know you go to facebook
and you scroll to news feed you go to
scroll to news feed but with youtube
typically people
are specifically looking for something
when they go there
so there's a key that's a key
distinction and if you don't understand
that i think
you know you'll get trapped up trying to
compare these things head to head in
reality
your your prospect and you get the same
exact person right
one of them on facebook they're
scrolling they ain't in the mask they're
in a different mentality
they go over to youtube they had a whole
nother mentality same person
so you just gotta understand that and
play to that
if you will yeah no that's a really good
point i was just thinking about that
it's like
yeah if i'm on facebook i'm thinking
about something else i'm looking at what
friends are doing i wanna catch up
family
all that kind of stuff i'm reading
perhaps articles or looking like what's
happening in the world or my world or my
curated world
and when i'm on youtube i'm there to
learn i'm there to be entertained like
all these kinds of things
and uh yeah the the ad is more in your
face
facebook you got messages popping you
got chat going like you got all these
other distractions so you're just in a
different mindset
um well look i'm sure people want to
know
more around like like
you've spent a lot of money on youtube
ads how much have you spent
like what would you say i mean i think
it's about
30 million uh you know probably 35
closer to 40 now i think 30 million is
probably a number that i came up with
maybe like
i don't know a year or two ago um
because we probably you know my clients
combined in the last 12 months
and spent maybe 20 million but that's
not just
youtube that's a combination of things
and we don't manage all of that
but um you know we clients that we work
with they do give
us a level of access to a lot of the
other things because we're trying to
kind of build a cohesive
you know game plan right which is
another key point
you should be able your facebook and
your
youtube especially if you hire agencies
they should probably talk to one another
um but yeah i'd probably say maybe
closer to 40 million now but it's just
kind of hard to keep up
i'm terrible at tracking those things
because i'm always thinking about
their head what's ahead of me and not
looking back but
um conservatively easy 30 million
probably closer to 40 maybe more than
that i don't know but
i just try not to overshoot you know
what it really is because i don't i
really don't i really don't
know i haven't tracked it you know
dollar for dollar throughout
i just don't really i'm always trying to
like what's the next level that i want
to go to so
i'm not much of a uh that ain't really
my thing but you know people ask me that
a lot so
you know that's all good i respect that
but it's safe to say you're spending
like well over a million dollars
a month on youtube ads right yeah yeah
so it's a lot of money so so
where i'm going with this is obviously
um you know
everyone watching now you've got some
stuff to share around how to
like what are you look what have you
learned from all of that
and i'd love to you for you to share
around your c3
formula like you know like tell us more
about that
the c3 really is more of a
overarching lesson that i learned just
in this game
ultimately you know your creative
your campaigns and conversions are the
three
key elements really it doesn't you know
matter where you buy
an ass actually um you're gonna need the
three of those things to be dialed in
it's what are you saying who you send it
to
and uh what are you selling at the end
of the day right so your creative is
you know what are you saying you know so
your your campaigns is like
who do you want to say that to that's
where you create the targeting and all
of the different things to
get that message in front of the right
people right and then conversions
is when they see my ad and i get them to
click on it and go to my website on my
landing page
how do i get them to convert conversions
my funnel my landing page
you know get them into my world if you
will and so those are kind of the three
uh buckets that we kind of break
everything down in
and usually for us we like to start
with the end and work backwards so it's
first of all it's like
what are you selling who do you want to
sell it to
what do you need to say to them to get
their attention to even be
interested in you know that that's kind
of how we work that that system
yeah fascinating so let's break that
down a little more let's talk about
creative um so when it comes to creative
for you what makes a great youtube ad
from your perspective
so the key three uh hook
message call to action right hook
message call to action
the hook is important because with
youtube
we're talking you know the majority of
the type of ads we run today
uh so remember back you know while back
we were talking about
kevin and the strategy of uploading the
video
so back then we were running something
called uh
i think they called them in display now
it's called discovery
youtube discovery ads is what the
technical name is today but back then it
was called in display
and at that time we ran probably 80
70 80 percent was that well today we run
in stream about 70 to 80 percent
that's basically you're watching a
youtube video you're about to watch it
the ad pops up and you got to wait five
seconds to skip right
that's the predominant type of youtube
ad that we run today
in order to be effective that type of ad
that's what i talk about hook message
call to action
because you got five seconds to cook
them
to get them to care about whatever
you're talking about
and then you have the message component
is the uh from the hook
to your call to action like all of the
things that you're gonna say
within that time frame and then
obviously your call to action what do
you want them to do as a result
so with call to action you got to be
very specific
right uh if you want someone to register
for a webinar or
you know buy your product if you know
that you're going to send someone down a
path of a series of questions
you're telling them that you know so one
of the examples in
uh legion we tell them fill out this one
minute
form now we use one minute so that's
because it can be a minute if they go
ahead and do it
but it's letting them know when they get
there
there's it's not they're not just gonna
land on the page and you know whatever
the case may be right
so you're being more specific about the
action that you want them to take
you have to really you know communicate
that the hook
is really more about to me
a targeting strategy of
what are your people what mindset are
they in what kind of content are they
consuming you know are they only
watching some channel or you know are
they consuming content about x or
what are their interests you know so
based on your targeting your hook
should be as relevant as you can
to where they are already so that you
can connect with them based on where
their minds say that
that's really what a a really strong
hook is going to do
well they really don't do two things
they also open loops
which is another strategy you probably
heard of before but
open loops i like to use open loops uh
and we like to segment our audience
based on you know where they may be at
so that we can try to
uh create a hook that's uh relevant to
where they are
now and then open a loop to keep them
watching right then that's when you kind
of
build the rest of the message out from
there
and you know that those are kind of the
key
main elements i don't know if you want
to go deeper on that but
those are kind of the key things that
that that i wanted to point out
yeah no this is awesome man this is this
you just like yeah this is awesome i'm
i'm curious
what do you mean by open loops what are
they like how's that work
so i tell you why i learned it this guy
named andre chaperone
he had a product called autoresponder
madness
and in that product he taught us how to
use
what he called soap opera sequences so
if you ever watch the soap
opera at the end they show you some
stuff
reality tv do a lot of this now too well
like at the end of the show
they they show you the next show but
they just really
wet your beak you know what i mean
because it's like man i gotta watch the
next show
another thing that do this very well is
movie trailers
right so a movie trailer is designed to
open a bunch of loots
to make you want to get up and get in
your car drive to the movie theater
stand in line
pay money go stand in the line again
get a bunch of popcorn and all of this
stuff then go sit down
wait 30 minutes because they're gonna
put a bunch of things in front of you
then play the movie imagine that right
so
movie trailers are very powerful in this
type of thing so i usually like to give
examples right so i could try to explain
it and probably wouldn't do it justice
but
you know movie trailers soap operas
different shows and stuff like that like
you'll see it all around you it's
everywhere
yeah now that that was a great example i
love that man
um and look we go through like
all this stuff in way more depth in in
you know our master class
that we do together so there'll be more
info about this
um wherever you wherever you're
listening watching there's more info
about this below but um okay let's talk
about metrics
um so how much do people need to be
spending per day
like uh you know how can someone
leverage youtube ads
uh with you know a hundred dollars
compared to a thousand ten thousand
dollars like yeah talk to us about
metrics
yeah i mean you know it's subjective
right uh
you know every person is running their
own race
and so i i i uh you know i i get caught
up in that at times as well and i have
to remind myself i'm running my own race
i can't try to compare myself to
but like you can start with 5 or 10
bucks a day you know you just have to
understand that
you're going to learn slower that way
the more you spend the faster you're
going to learn
and that's really the mindset that i
would like
most well i don't think i'm gonna ever
get everyone to see it the way i see it
but like
if if possible the thing i try to get
people to understand is the mindset
of learning the more you spend the
faster you learn
and the faster you get to success but
some people aren't you know they don't
run as fast as other people
and that's okay but just keep that in
mind so
you know you can start with five ten
dollars a day 20 bucks a day
um you know and then it kind of depends
on what you're selling
so if you're selling something for a
thousand dollars and you spending 10
bucks a day
it's gonna take you a really long time
to you know
learn to get any amount of data i mean
you know that would take what 100 days
and 10 bucks a day just to spend the
price of what you're selling right it's
you know but if you're selling a 50
widget you know what i'm saying you
could start with 10 or 20 bucks a day
and you could get some learnings pretty
quick
you know you know 100 bucks 200 bucks
you
you'd have an idea of you know
click-through rates you know what people
could i get a conversion um you know
because it's not about
being profitable out of the gate it's
about learning
and then the faster you can learn um all
we're doing
ultimately is we learn as quickly as we
can
we figure out what works we figure out
what don't we stop doing what didn't
we keep doing what was and we try to do
more than and we just iterate through
that process
over and over again so it's
it's not you know i mean you don't have
to have a crazy large but i mean even
our big budget clients they don't come
to us
out of the gate and we spending five
grand a day it don't really work like
that most of the time
we're starting out at a couple hundred
dollars a day and then we build it until
we can scale it up to five
ten fifteen thousand dollars a day but
that's not what we start yeah
love it though love love that breakdown
and and this idea of learning
um because i think sometimes people are
just like oh i'll spend some money
and i'm going to make all this money
back and like yeah
it's it takes time right so let's talk
about um
margins unit economics
um because i think that's really
important as well what kind of margins
what kind of roads or return on ad spend
should you be aiming for with the
youtube
play the way i see it is
every successful business that i've ever
seen
has some things in common but one of
them
is they get a customer and then they're
selling more stuff
and i feel like a lot of times in our
industry
everyone's trying to make money the
first time they go
you know get accustomed and it's like
imagine meeting a girl for the first
time and
you know you want to immediately go from
meeting to having a baby being married
and the whole nine like at the gate like
it don't work like that you know what i
mean
so so i'm a big proponent of people
understanding
more about what they can pay to acquire
a customer
based on the fact that they know they're
going to sell them more stuff
is what i like you know for people to
look at in it and
in that that's when you start getting
into the margins that's when you start
looking at
how much revenue am i going to make and
what is going to cost me
to deliver on the promise that i made so
i want to be clear about that right
because
when you're looking at traffic your
margin should be
everything it took to deliver on the
promise that you made so
if somebody bought a 100 thing from you
what does it cost for me to put that in
their hand if you're doing
physical products right if you're doing
a digital product
you got to look at you know
what does it cost to put it in their
hand you know what is
how much my merchant fees are going to
cost me what's my typical refund
chargeback rate
uh you know what is my manufacturing
cost of you doing physical product
you have to take all of that stuff into
consideration to get some idea of
if i collect the hundred dollars what's
actually left
and then that's gonna start dictating
how much you should pay
right but if you understand that you can
sell more things to people i think
you know the mindset is different from
what you can pay
what you think you can pay now versus
what you really can pay
but the first step you do got to do is
you got to look at
how my how much money am i gonna make
when i sell this
right top line revenue and how much it's
gonna cost me
to deliver on my promise right so if
there's a promise that i'm gonna put
some in the mail to you
or a promise you're gonna be able to log
into this thing or download something or
whatever it is
you have to think about all of the
things that
you got to do to deliver on that because
that's what your true margin is
is what's left over when it's all said
and done
um so that's really how i try to get
people to think about
the margin and then from there i can
start walking you into
well what can i actually pay because
maybe
i got 50 bucks left out of this could i
pay fifty dollars
well technically then you break even
right you collect a hundred
you you you spend 50 to deliver your
promise
you spent 50 getting them you didn't
make anything
well i mean did you or did you well if
you didn't make anything
can you sell them something else because
now when you sell that customer
something else in the future
you don't got to pay for that customer
again you already did that
so now you all profit right so it's just
a mindset shift
um to to to have but
uh margin true margin is what i call it
is everything that it takes to deliver
the promise you made when you took
somebody's money
yeah no man that was gold i love it uh
because
yeah there's levels to this right yes
there's levels
and the companies like your organifiers
who you work with and you help them
scale tremendously
um you know the reason
that they were one of the reasons
they're able to is because they
they could spend a lot of money like um
ryan dice
uh always says that uh the the person or
the company that can spend the most
wins to acquire a customer so true man i
learned that lesson
uh actually a russian guy taught me that
listen
2012 we were spending about 70 grand a
day
and i was spending 70 grand a day on
google display
um we when i took over their account
they were spending about five grand a
day
and they wanted to scale that and i
think the most at that time maybe i
spent like 12
000 in a day but when they told me their
cpa
i was like oh yeah i'm about to oh
because they was doing a 7.95
free trial and they were paying 100
bucks and for the life of me i couldn't
understand how they do
how they doing that you know and that's
how i learned the lesson of
you know whoever can spend the most wins
because you know that's just what i was
doing like these guys were probably
spending 200 to 200k at bay
um but we were spending we scaled from
five grand a day to seventy thousand
because of that and i learned that
lesson that's the first time i've ever
had
anything even remotely close to that and
it really blew my mind because i
couldn't understand
how are you spending a hundred dollars
in y'all so then i understood
funnels and upsells and rebuilds and all
of these things that they were doing
and so when he basically ran the map
because i'm you know math
it's like this math doesn't make sense
you got to make this math work
i mean you don't have to make it work i
just keep spending your money but i'm
just curious
and uh you know he started explaining to
me what they were doing but he still
left some stuff
out so you know i went through the
process myself
and that's what i learned man i got like
a crazy
lesson in that because these guys had
upsells and cross sales and rebuilds and
all of these things
then they were promoting affiliate
offers as well so their customer value
was probably
four or five hundred dollars maybe and
so they could pay a hundred because they
knew their numbers
that's how i actually learned that that
uh that lesson
so when i hear people say that i always
think about that situation
because it's like it's so true that's
how i learned that lesson working with
somebody who
who was doing something like that yeah
that's crazy man thanks for sharing
dude we could talk about this all day um
you know we're really excited to work
with you
uh to create this incredible program
on how to successfully run youtube ads
on the founder platform
um but look we'll work towards wrapping
up we've got a hot seat round
so we're going to ask you a few
questions 30 seconds
so the first question i have is what's a
brand that people should be studying
right now that are producing amazing
videos
uh when it comes to youtube ads
grammarly
that's easy what's one trait every
single entrepreneur needs to be
successful
resilience what's one thing you
wish people knew about youtube ads how
powerful it is
i mean it's i think it's the most
powerful advertising medium on the
planet but obviously i'm biased
what excites you the most about the
future of youtube advertising
more uh adoption uh
more you know like the whole world isn't
even connected to the internet
uh so just the fact that you know
there's seven billion people on the
planet and
we still got a ways to go to get people
uh
connected uh globally uh
so that they can be able to access it um
that's exciting
super exciting yeah love it um if you
could have
dinner with any entrepreneur dead or
alive
who would it be and why i would probably
say steve jobs i'd probably say steve
jobs i got so many apple products in my
house
how you get me to do that why
i got so many freaking apple products in
my house is like
how how like what were you thinking
you know what i'm saying to create this
phenomenon of what we you know
it's just i i want to know how how he
thought about product development and
just
getting people to adopt this product and
be
you know so um
you know uh loyal
yeah no it's incredible if you think
about like
i'd love to know the customer lifetime
value of you and i
for foreign
like yeah if you think of like all that
like
team members like insane amount of
equipment
yeah awesome well look man we'll wrap
there thank you so much for your time
this was incredible uh i we only just
scratched the surface with you there's
so much more but
uh we're so thankful to be working with
you and for you to give back to our
platform and to our community so thank
you so much man
thanks so much so much i enjoyed it hey
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