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Why Your Performance Max + Meta Ads Are Not Working

John Moran analyzes an account that has a 40% decline in traffic and 81% drop in sessions by socials. He dives into the account to figure out what’s causing the declines. He also discusses why running Performance Max campaigns and Meta Ads for this particular business might be causing more harm than good, the potential risks and benefits of different advertising strategies, including the importance of balancing profitability and scale. He then suggests alternative strategies and where to focus on to achieve business growth. Listen to this episode to learn more.

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0:00 Intro

0:19 When Performance Max with Meta Ads Might Be a Bad Mix for Your Advertising Efforts

6:50 Decline in new customers

13:27 Strategies recommended by John



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Transcript
John:

So what the Facebook in app shows is, wow, we spent 81 percent

2

:

less and made 41 percent more

revenue for the lack of top line.

3

:

Yeah.

4

:

So this is going to be a slow death

5

:

What other marketing does he run facebook?

6

:

yeah, and asked for access to his

facebook so that Pleasant and I can

7

:

look at What they're doing because

he said in the meeting I had with him

8

:

that they've switched from outbound to

mostly remarketing in their facebook

9

:

So we wanted to go in there and double

check he's only running PMAX in there.

10

:

So we've talked about relaunching standard

shopping and seeing what, but pending

11

:

what they're doing in Facebook, cause

we want to actually see it for ourselves

12

:

and not just take his word for it.

13

:

not only did he switch heavily

to remarketing, he also,

14

:

it looks like pulled back.

15

:

This 30 days compared to previous 30 days.

16

:

So there's an overall drop of

24%, which I would imagine, did

17

:

that sometime around March 20th.

18

:

Yes.

19

:

we met the end of April,

for the first time.

20

:

And he had mentioned recently

switching over the PMAX.

21

:

So there's a 40 percent loss in traffic

and 81 percent drop in sessions by social.

22

:

let's just say he had

a UTM whoopsie daisy.

23

:

that would mean that direct

would go up and it's not.

24

:

So it's definitely a pullback.

25

:

which pullback search, pullback,

direct pullback, direct sales.

26

:

now search is up here, but the reason

why Facebook has now attributed is

27

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they did go probably towards more

remarketing, so what the Facebook in

28

:

app shows is, wow, we spent 81 percent

less and may 41 percent more revenue.

29

:

For the lack of top line.

30

:

So this is going to be a slow death,

but the bad part is now it's going to be

31

:

solely up to Google to bring in the new

traffic, which we're using a platform.

32

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That's just going to try

to hover at that point.

33

:

this is also reducing

sales here that we can see.

34

:

So there needs to be a

prospecting source somewhere.

35

:

and I think that the prospecting source.

36

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my opinion would be I would be going

after the angle of election season and

37

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instability in the socioeconomic climates.

38

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that would be my recommendation.

39

:

How's the pricing competitively?

40

:

from what I understand, it's, fairly

competitive not like the cheapest,

41

:

So they sell Dura Steel is the brand

they just started putting on Amazon.

42

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Apparently.

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But I couldn't find anything with

their company brand, within Amazon,

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but he said they're on there.

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I'm hoping to clear that up with him.

46

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Gotcha.

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Gotcha.

48

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Gotcha.

49

:

So water distiller, distill water

machine, classic distiller, distill.

50

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So I think one of the reasons why

we're seeing a stability is obviously

51

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it's a lot of good cold traffic.

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No, one's really looking

for the brand name.

53

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but right here, best hit

the fan water filter.

54

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This is that pepper thing right there.

55

:

this is definitely gonna be

a prepper type of mantra.

56

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I would share this with them.

57

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Just say, hey, by the way,

with remarketing pulling back,

58

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we're having obviously a lot

of good success with Google.

59

:

Now, our cold traffic in Google is good.

60

:

That's why, with a 40 percent

reduction in Google Meta traffic are

61

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orders didn't decrease, but there is

a increase in return customer rate.

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So this could be a false positive for

the short term until that atrophies

63

:

because returning customers can

only buy so many water filters.

64

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so the data is already starting to support

our theory about what's going to happen.

65

:

Yeah, so if we look at new customers,

since March 21st, this is when

66

:

they switched to remarketing.

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February 4th, March 20th.

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:

Okay.

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is what we get to compare that to.

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So 1.

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they lost 26 new customers.

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between them turning off meta and going

to remarketing, but since they lost 33

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new customers, it was falsely added up to.

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now we have a few

existing return customers.

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And it looks like only just recently here.

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:

I think that's one of the

reasons why since the 28th, we're

77

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probably having some good success.

78

:

Yeah.

79

:

There's your success here.

80

:

Success here.

81

:

81 percent more orders, but that came

from all the returning customers.

82

:

it could have been a restock.

83

:

It looks like they're using a lot

of in app ROAS to be like, yeah,

84

:

we're successful, but they're

missing the forest for the trees, but

85

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they really are stuck on the ROAS.

86

:

Yeah.

87

:

Yeah.

88

:

That sounds about right.

89

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That's why this thing's all flip floppy.

90

:

I would draw them a bigger picture.

91

:

Say if we take a step back and we don't

take any sort of in app platform metrics

92

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and distill what's going on here.

93

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they'll like that joke.

94

:

Then we look at the loss of their

cold traffic has done, a small

95

:

number, in decline of new customers.

96

:

It's been recently made up

with existing customers.

97

:

But those existing customers will

become less valuable over time because

98

:

they're going to be doing replacement

filters, which is also why they probably

99

:

saw a spike up in return customer

rate and the drop of their AOV by 38%.

100

:

and those are gonna be like, gasket set

parts, and plastic lids, and a switch.

101

:

So they're a couple of takeaways

is losing core product,

102

:

sales, new customers are down.

103

:

33 from the switch to remarketing.

104

:

What does Google say

in the last seven days?

105

:

I would imagine that's probably

showing some, Dura still distiller

106

:

parts that might be coming from

their existing customers or people.

107

:

People have purchased from them before

that forgot about water distillers.

108

:

com because that is a very generic

name and not only resellers are

109

:

not investing in their brand.

110

:

so that makes a lot of sense,

especially if jurors still

111

:

went out of stock somewhere.

112

:

This is like woohoo free existing

customers that probably didn't

113

:

buy from us before they had a

backlog issue several months ago.

114

:

They ordered well in advance

because they had been having

115

:

procurement issues for a while.

116

:

Makes sense.

117

:

It's cool when you come

and take a step back.

118

:

And once you start, looking at these

things, I would say, in app ROAS on meta

119

:

is most likely up 100 percent or more.

120

:

that'd be a good question.

121

:

In app ROAS is most likely

100 percent or more.

122

:

Yes.

123

:

But that's also because we're

No hemorrhaging our own clients.

124

:

return customer rate is up 30 percent

which is offsetting the top line

125

:

metrics to a, slightly down trend.

126

:

But our future business is at risk.

127

:

if you're measuring business

performance year over year.

128

:

This is down 30%, down 50% down

30% down 13% because that's up 42%.

129

:

so this is what's interesting

is this here is floating.

130

:

That these here are all metrics.

131

:

So these are your correlating metrics.

132

:

Your return customer rates up

'cause they're buying refillables.

133

:

And because of your own customers

it's up because, they, they trust you.

134

:

But our top line is we're going to

see a slow decay and that's why year

135

:

over year, this will say, we need

a cold traffic, channel to push.

136

:

Now performance max can probably do that.

137

:

it may not, It's a full build.

138

:

It's a Okay.

139

:

What is enabled?

140

:

Standard chopping is not

really the answer here.

141

:

it could be because they're going to be

doing a lot of remarketing on meta, but

142

:

I think that their meta was actually

performing better than what they saw.

143

:

They were just judging it wrong.

144

:

actually let me do that

and do this theoretic.

145

:

so if we did January to the 19th year

over year, What was going on between

146

:

October, 2023 and December, 2023.

147

:

Do you remember?

148

:

Oh, I don't know.

149

:

I just took over and I don't believe

we touched on that during the meeting.

150

:

it might have been the stock issues

that, that was a kind of a pervasive

151

:

issue for them for a little bit.

152

:

but yeah, from a marketing standpoint,

I know they've been reducing their

153

:

budget gradually from, I think

they were at 8, 000 and they've

154

:

been trickling down to 3, 500.

155

:

so that might be a factor.

156

:

Yeah, it looks like when everything

was being pushed, especially on

157

:

Facebook, Your direct is going to go up.

158

:

Your social is going to go up.

159

:

So your search is going to

go up, just not as much.

160

:

Cause it's going to be the return brand.

161

:

but this is year over year, fourth

quarter, 23 to fourth quarter, 22.

162

:

Now, fourth quarter is going to be always

like, the land of milk and honey, Oh,

163

:

that's a burkey ver like, competitor.

164

:

I would definitely push less

hard into metal remarketing.

165

:

That was too big of a shift.

166

:

. Your in-app.

167

:

Rowa is gonna look amazing

until you're out of business.

168

:

so that'd be the first thing to say is,

Hey, trying to do good by your business.

169

:

This is not something that is sustainable.

170

:

Half the traffic is not sustainable.

171

:

I would say, and then make the

mention that the mix between meta

172

:

and performance max is performance.

173

:

Max is going to remarket heavy and if

metas remarketing heavy remarketing

174

:

is always going to have a better row

as just like brand, it always will

175

:

just at very much lower volumes.

176

:

it's almost a fact of do you

want high profitability or do

177

:

you want, scale or a mix of both?

178

:

If you want high profitability,

then just hang tight here.

179

:

if you want profitability and scale, we

need to start pushing more cold traffic.

180

:

The sources that the source as to which

I would recommend would be in meta

181

:

just because it's an election year.

182

:

And this is where we're going to

start to see more prepper mentality

183

:

closer and closer to the election.

184

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There's also Trump is on trial.

185

:

he is of the base.

186

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I would say that this is

probably going to mostly with.

187

:

And the results of those trials could

cause potential for the theoretical,

188

:

socioeconomic or not socioeconomic,

but just the social climates really.

189

:

so I think he may be missing a mark on

capitalizing his base, during probably one

190

:

of the most important times of the year.

191

:

Yeah.

192

:

so even if we just don't put all back

into where, into there, but I would say

193

:

that's, that would be the angle I would

begin to test and then watch top line.

194

:

there's, you can see extreme correlations

between their shifts and what they've

195

:

been making now, what in a bro as

potentially would look like, but what's

196

:

actually going on in this business.

197

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What I really want to do is, yeah, I

really wanted to get us that access to

198

:

facebook so we can take a look and then,

hopefully softly convince him to let

199

:

us take over as meta so we can do this.

200

:

All together in house instead of trying

to fight with his meta people and

201

:

fight with him and, that's the goal.

202

:

the thing I would say is, hey, if

you're going to do all remarketing,

203

:

why don't we just do all brand?

204

:

You're going to have, TEDx's

across the board easy.

205

:

Now, no one ever find you again, but all

of that returning customer every day,

206

:

we're going to go down to the 30 percent

of people that are left, which is fine

207

:

because apparently Google can go down only

to 50 percent of the people that are left.

208

:

So why don't we just make the full shift

in there and just, ride out that high

209

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amount of volume until, we part ways.

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:

would honestly ask him that, just

say, Hey, not to be exaggerated,

211

:

but if we're 50 percent of the

meta traffic, why don't we cut out,

212

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50 percent of the Google traffic?

213

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we're going to be down a hundred

percent year over year, but

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it'd be extremely profitable.

215

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No, I don't want to do that.

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:

we've already made one of those changes.

217

:

So I'm asking, I'm curious

as to why that's okay.

218

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We were halfway there.

219

:

So all it is to be said is when

you poise those questions, you want

220

:

to get them thinking differently.

221

:

Looking at Navarro, I'd be like, crap,

we can do the same thing on Google.

222

:

All I have to do is just go after your

brand name and then boom, amazing results.

223

:

Yeah, we're already 50

percent of the way there.

224

:

If we go a hundred percent of the way.

225

:

Yeah, you cut out 77 percent of your

traffic and make, 50 percent of the sales.

226

:

Great.

227

:

that's pretty cool.

228

:

Look at that.

229

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You look at how much profit there minus

77 minus 53, that 20 percent right

230

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there is just pure cash in the bank.

231

:

Why would we do that again?

232

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I don't want to do that.

233

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so why don't we think about how

to slowly push rather than just,

234

:

cut off one leg in a marathon.

235

:

Yeah, lots of work.

236

:

Thanks, John.

237

:

You got it.

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