Facebook Ads Case Study: Design Pickle Increases MRR by $5.8K/mo.

Kyle’s note: Conversion rate optimization fascinates me. This post by Vincent Nguyen shows how making it more difficult for visitors to convert can sometimes be a good thing. It makes the difference in this case study on Facebook Ads campaign for Design Pickle. Over to Vincent:

Old school sales – not the door-to-door type

In a world of marketing automation and email autoresponders, running a business has become more hands-off and well… automatic.

Automation has its place, but some businesses require more personal touches and communication, especially when the price tag is significantly higher than a typical $30 eBook (a $300/mo. SaaS business, for example). With more people moving to email autoresponders and less personal sales, there’s a wide gap that’s ready to be exploited:

Design Pickle realized that taking advantage of that gap meant picking up the phone and closing deals. Their prices aren’t cheap ($195/mo. is their lowest price point). Being a company that relies on email communication to fulfill their service, there’s a certain trust they need to build with potential customers.

So what has worked best for them so far?

It wasn’t sending traffic straight to a sales page. It wasn’t building an email list and relying on the email chain to convert (though these certainly help). Although effective (and totally awesome), handing out pickles at ICON wasn’t scalable.

Russ Perry in Design Pickle Suit

Russ, Design Pickle’s founder, noticed that a lot of people were skeptical of the service because they’ve never seen a business offer unlimited graphic requests before. Picking up the phone and walking potential customers through how it works and building a line of trust was key in closing many of his leads.

Related: How Russ Perry grew a multiple 6 figure business in 106 days

Without a doubt, Facebook Ads has been the number one lead generation source for making this work for Design Pickle. It’s working so well that 20 percent of their current customers came from the Facebook funnel Growth Ninja setup for them.

The data speaks for itself:

Russ spent $4,526.29 on Facebook Ads to generate 496 leads and $5.8K in MRR. (CLICK TO TWEET)

Design Pickle Ad 1

His team calls each lead within 24 hours to explain how the service works and to deliver a free design to give the prospects an idea of what to expect to see as a paying customer.

Out of the 496 leads, 30 turned into paying customers, bringing in $5,850 in monthly recurring revenue.

With the lifetime value of a Design Pickle customer being around $1.1K, spending $150 to acquire each customer ($4,526.29/30) means there’s a 633% ROI from the ads [($1,100-150)/150]. With these numbers, Facebook Ads are absolutely crushing it.

Disqualifying prospects with high friction

So how did we set up their Facebook Ads funnel and why has it been so effective?

Each visitor from the ads went through a high friction form that offered one free graphic design.

Design Pickle High Friction Form

If you take a look at the above screenshot, you’ll immediately notice that it’s not a simple email opt-in. In fact, it asks so much that you could expect lower conversion rates overall.

It’s intentionally designed to weed out people who were least likely to be paying customers.

Conversion rate enthusiasts may be shaking their head right now at the thought of making it harder for prospects to convert, but we suspected that the people who go through the process are better qualified to call up on the phone.

Related: One penny and 30 days: the conversion audit overhaul

They could, more than likely, increase the amount of leads by making it a simple email address opt-in, but disqualifying prospects right off the bat allows his team to only call people who are more likely to make a purchase.

This saves them time on the phone and prevents them from having to create a free design for someone who was never going to become a paying customer.

If you’re building a list of prospects to call on the phone, you’re allocating a lot of resources.

Remember to disqualify and focus on the low hanging fruits.

When to go high friction

There’s no exact criteria for when the high friction funnel with a phone call close is most effective, but here are a couple basic guidelines:

1) You have high value customers that are worth at least $400+ over time.

In Design Pickle’s case, a single sale is worth at the very least $195/mo. for their cheapest plan and the lifetime value is about $1,100.

2) Your product / service involves a lot of communications with the customers or your target customers and industry interact mostly over the phone.

Since their customers utilize email to request new designs and get adjustments, it helps to build trust and authority by speaking over the phone first.

Okay, so you’re onboard with high friction lead generation and getting on the phone. How do you go about getting those leads at a low cost and with a healthy profit margin?

Asking the right questions

Getting their name, email addresses (which put them onto an autoresponder), and phone number is a given, but think about how you can disqualify prospects who wouldn’t be a good fit.

A few questions that Design Pickle asks in their form are:

  • “How much do you currently spend per month on graphic design services?”
  • “On average, how many creative projects do you have per week?”
  • “How experienced are you in hiring graphic designers?”
  • “Are you comfortable using email to make creative requests?”

These questions allow them to gauge the likelihood of the lead converting into a customer.

Setting up a system

If you want to scale an operation like this and see positive ROI, you have to be consistently getting on the phone and closing the leads.

Every time a new lead goes through Design Pickle’s lead form, Russ and his team get a notification and they can assign the call to a specific member of the team.

Design Pickle calls the leads up within 24 hours, while they’re still at the top of the client’s mind. (CLICK TO TWEET)

I’d recommend calling them as soon as possible and starting the conversation by giving them something of value.

Tell them what the next steps are.

If your business is a Software as a Service (SaaS) then you could offer a free 7-day trial over the phone. Follow up again once the trial is over and turn them into a customer.

For Design Pickle, the action step during the call is to get them to request a free design. Once they have the design, they’re asked to sign up for the full service of unlimited graphic designs.

How to drive traffic and scale the funnel

One of the best scalable traffic sources right now is Facebook Ads because of the platform’s incredible audience targeting system, which is one of the most important factors to running a profitable campaign.

Tony Rulli wrote a great article on Facebook retargeting (retargeting accounted for 17 of the 30 new customers from Design Pickle’s Facebook campaign) and he also walks you through the technical aspects of setting things up for the first time.

If you use Facebook Ads, set up retargeting and also target cold traffic sources to bring in new people. (CLICK TO TWEET)

But you don’t have to limit your growth to just Facebook Ads.

You can link to the funnel on your website and convert your regular visitors. You could send out an email blast to your list or engage on a content marketing campaign.

Then there’s AdWords, Twitter Ads, LinkedIn Ads, and tons of other channels you can take advantage of.

So what’re you waiting for? Time to start making some calls (and a ton of sales).

JOIN 20,000 AND GET OUR BEST CONTENT

Each week we send 1 email to 20,000 smart entrepreneurs just like you. Enter your email below to join the crew.

We will not share your email. 100% privacy

About

Vincent Nguyen is the founder of Growth Ninja, a performance-based lead generation service that specializes in Facebook Ads. You can follow him at @SelfStairway

  • Great post Vincent – a very clear and lucid summary. Love it when writers focus on the lead flow and ROI and tie it in with real metrics.

    One sticking point was the ROI. I’m sure that as recurring revenue, it more than pays for itself over time. But you showed 458% ROI based on just the first payment. How was that calculated? Assuming a very generous 90% margin on 5.8K in sales, then the ROI on the ad spend would be 16% right? ((0.9 * 5850)-4526)/4526)

    I’m only trying to call that out because I want to apply this to my own business and want to make sure I’m getting the calculations right!

    • Hey Joe!

      Ah, thanks for pointing that out. Turns out the ROI isn’t 458% but actually 633% (article updated to reflect that). Here’s the breakdown:

      We spent $4,526.29 in Facebook ads to acquire 30 paying customers. That means for every $150 in ad spend, we closed a sale.

      Since the Lifetime Value of a Design Pickle customer is $1,100, it comes out to be 633% ROI when using the following:

      [((1100-150)/150)x100] = 633%

      • Awesome – the LTV was the missing piece. Thanks and keep more of these coming!

  • Spencer Cohen

    Incredible! Thank you so much for sharing

  • Justin Cooke

    Great post, Vincent!

    I love the concept of higher-friction opt-ins when you have a high-value product/service that you’re closing over the phone.

    Ultimately, you want to save and protect your sales team’s time (they can be expensive!) and better qualifying the leads to call is a smart move. Design Pickle may be missing out on some opportunities with the higher-friction opt-in form, but then you also have to consider all of the wasted calls on non-qualified prospects. (And the expenses that come with sending your sales team after bad leads)

    • Thanks, Justin!

      You’re actually the person that opened my eyes to the importance of optimizing conversions for the RIGHT lead (remember the giant sidebar?)

      Volume doesn’t matter if it means you have to throw a lot of resources and time at prospects don’t pan out, especially if you’re getting on the phone with the leads.

      With a limited sales team with limited time, letting the qualified prospects raise their own hands is the way to go.

  • Vincent, rock on man. It’s been a pleasure working with you. May our futures be filled with increased advertising budgets 🙂

  • Knowledge bombs all over!

  • It’s true, if there’s something I learned about direct response ads, it’s that you need to systematically make sure that you get in touch with every lead as soon as they sign up – while their memories’ fresh!

    • Sorry for the late reply!

      Hope you don’t mind me asking: for your own campaigns (or clients’) do you typically work with autoresponders or more personal phone closes?

      • Hey Vincent, no problem.

        I typically work with more autoresponders and email sales sequences than personal phone closes (just 1 client who has done that so far)

  • Excellent case study, Vincent. I would use these techniques next time I use Facebook ads for leads.

    2 questions for Russ regarding the call after you get a lead:
    – Could you briefly explain what you tell the prospects when you get on the phone?
    – Also, you don’t offer phone support for your small and middle plans. Do people actually call you on that number afterwards asking you for support and how do you handle that?Doesn’t the call breach the border between a productized service and a typical design service once you get personal with them through the phone.

  • Courtenay Farquharson

    Hi Vincent,

    Are you able to say what demographics you used to target to people who would be specifically interested in this? By job title? By?

Free download

The Wheel of Copy

A visual guide of persuasive words proven to boost your results with copywriting