Hi there,
Thanks for reaching out about the recent dip in your ad performences. It’s easy to point the finger at platform updates like Meta's new subscription model, and while they can cause temporary ripples, a disastrous drop like you're describing almost always points to deeper, more fundamental issues within the campaign strategy itself. It's frustrating, I know, but it's also a massive opportunity to build a more resilient and profitable advertising system.
I'm happy to give you some initial thoughts and guidance based on what we see day-in, day-out with accounts we manage. The truth is, most advertisers are running campaigns on a foundation of sand. When the wind changes, the whole thing collapses. We need to rebuild yours on solid rock.
TLDR;
- Stop blaming external factors like Meta's subscription service. The real problem is almost certainly your campaign objective, targeting, or offer.
- Never use "Brand Awareness" or "Reach" objectives. You're paying Meta to find non-customers. Switch every campaign to a conversion objective (Leads, Sales, etc.) immediately.
- Your Ideal Customer Profile (ICP) isn't a demographic; it's a pain point. Define your customer by their specific, urgent nightmare, not their job title or company size.
- Your offer is probably your weakest link. Ditch the high-friction "Request a Demo" and create something that provides immediate value, like a free tool, a short video module, or a no-obligation audit.
- This letter includes an interactive LTV calculator to help you figure out exactly how much you can afford to pay for a customer, freeing you from the stress of daily performance dips.
We'll need to look at your campaign objective first... because you're probably telling Facebook to find the wrong people
Here’s an uncomfortable truth that trips up 9 out of 10 advertisers: if you run a campaign with the objective set to "Brand Awareness" or "Reach," you are actively paying Facebook to find you the worst possible audience for your product. It sounds mad, but it's exactly how the system is designed.
You’ve given the algorithm a simple command: "Find me the largest number of people for the lowest possible price." And it does exactly what you asked. It seeks out the users inside your targeting who are least likely to click, least likely to engage, and absolutely, positively least likely to ever buy anything. Why? Because those users aren't in demand. Their attention is cheap. You are literally paying the world's most powerful advertising machine to find non-customers.
Performance fluctuations are brutal in these campaigns because the algorithm is constantly chasing the cheapest impressions, which can be a highly volatile group. One day they might be vaguely receptive, the next they're completely ignoring you. This is why your "pretty good" week can turn into a "disastrous" one overnight. It’s not a bug; it’s the feature you selected.
The only way to build stable, scalable campaigns is to change your objective. You must tell the algorithm what you actually want: conversions. Whether it's a lead, a sale, or a trial signup, you need to optimise for that final action. When you do this, the algorithm's entire mission changes. It stops looking for cheap attention and starts hunting for users who exhibit behaviours similar to your existing customers. Awareness then becomes a byproduct of effective advertising, not the goal of it.
The Common (Wrong) Approach
Hope for Sales
The Professional (Right) Approach
Awareness is a Byproduct
I'd say you need to rethink who you're actually talking to...
Once you’ve fixed your objective, the next domino to fall is your targeting. Forget the sterile, demographic-based profiles you’ve been told to use. "Companies in the finance sector with 50-200 employees" or "Women aged 25-40 who like yoga" tells you nothing of value. It leads to generic ads that speak to no one and performance that falls off a cliff the moment the algorithm exhausts the tiny pocket of interested people in that huge, generic audience.
You must define your customer by their pain. You need to become an expert in their specific, urgent, expensive, career-threatening nightmare. Your Ideal Customer Profile (ICP) isn't a person; it's a problem state. I remember a campaign we ran for a medical job matching platform. Their client wasn't just an 'HR Manager'; she was a hospital administrator terrified of a critical nursing shortage leading to ward closures and patient care failures. The nightmare wasn't 'needing to hire nurses'; it was the risk of burnout, massive overtime costs, and jeopardising patient safety. That's a pain point you can build a whole campaign around.
Once you know the pain, you can structure your targeting logically. We prioritise audiences based on their proximity to the final purchase decision. It’s a simple funnel structure that builds stability and allows for systematic testing.
Here’s how we typically structure it for our clients, from coldest to warmest audiences:
- ToFu (Top of Funnel - Cold Audiences): This is where you find new people. But instead of vague demographics, you target interests that signal their pain. If you sell project management software, don't just target "Project Management" as an interest. Target users who follow specific methodologies like 'Agile' or 'Scrum', or who have shown interest in competing software like Asana or Trello. Even better, create lookalike audiences based on your best customers once you have enough data. Start with a lookalike of purchasers, then work your way up the funnel (add to carts, site visitors etc.).
- MoFu (Middle of Funnel - Warm Audiences): These people know who you are but haven't committed. This includes anyone who has visited your website, watched a significant portion of your videos, or engaged with your social media pages. You need to retarget them, excluding anyone who has already purchased or become a solid lead. The message here is different—it's about overcoming objections and building trust.
- BoFu (Bottom of Funnel - Hot Audiences): These are the people closest to buying. They've added a product to their cart, initiated checkout, or visited your pricing page. These are your highest-value audiences and you should be hitting them with ads focused on urgency, trust signals (like reviews), and making it incredibly easy to complete their purchase.
By seperating your campaigns and ad sets this way, you can allocate budget more intelligently and diagnose problems much faster. If your ToFu campaigns die, you know you have a problem with your initial messaging or targeting. If BoFu is failing, the issue is likely on your checkout page or with your final offer. This structure stops you from flying blind.
Goal: Introduce the problem you solve.
Goal: Build trust, handle objections.
Goal: Create urgency, close the sale.
You'll need to understand your numbers to survive these dips...
Even with the perfect structure, you'll still have bad days. That's just the nature of advertising. The key to not panicking is knowing your numbers inside and out. The real question isn't "How low can my Cost Per Lead go?" but "How high a CPL can I afford to acquire a truly great customer?" The answer lies in its counterpart: Lifetime Value (LTV).
Most businesses have no idea what a customer is actually worth to them, so they freak out when their CPL goes from £10 to £15. But what if I told you each customer was worth £5,000 to your business over their lifetime? Suddenly that £15 CPL doesn't seem so bad, does it? It looks like a bargain.
Calculating it is simpler than you think. You just need three numbers:
- Average Revenue Per Account (ARPA): What do you make per customer, per month?
- Gross Margin %: What's your profit margin on that revenue?
- Monthly Churn Rate %: What percentage of customers do you lose each month?
The calculation is: LTV = (ARPA * Gross Margin %) / Monthly Churn Rate.
Once you know your LTV, you can determine your maximum allowable Customer Acquisition Cost (CAC). A healthy ratio for most businesses is 3:1 (LTV:CAC). So if your LTV is £9,000, you can afford to spend up to £3,000 to acquire a customer. If your sales team converts 1 in 10 qualified leads into a customer, you can afford to pay up to £300 for a qualified lead. This is the maths that unlocks aggressive, intelligent growth and frees you from the tyranny of cheap leads and daily performance anxiety.
I've built a simple calculator for you below so you can see this in action with your own numbers.
This is the main advice I have for you:
I know this is a lot to take in, and it's a fundamental shift from how most people approach paid advertising. It's about moving from being reactive (panicking when performance dips) to being proactive (building a system that can withstand those dips). It takes more work up front, but it's the only way to get predictable results.
I've detailed my main recommendations for you below in a table to make it clearer:
| Area of Concern | Common Mistake | Recommended Action | Why It Works |
|---|---|---|---|
| Campaign Objective | Using "Reach" or "Brand Awareness" objectives, hoping for sales. | Switch all campaigns to a conversion objective (e.g., Sales, Leads, App Installs). | Forces the algorithm to find users who are likely to take a valuable action, not just cheap impressions. This leads to more stable and profitable results. |
| Targeting Strategy | Using broad, generic demographic or interest targeting. | Define your ICP by their deepest pain point. Structure campaigns into ToFu, MoFu, and BoFu to target users based on their stage in the buying journey. | Ensures your message is highly relevant and allows for methodical testing and budget allocation, making performance easier to diagnose and improve. |
| The Offer | Using a high-friction Call to Action like "Request a Demo" or "Contact Us". | Create a low-friction offer that provides instant value, like a free trial, an automated audit tool, a checklist, or a valuable piece of content. | It solves a small, real problem for the prospect for free, earning you the right to solve the whole thing. It generates higher quality leads who are already sold on your expertise. |
| Metrics & Measurement | Obsessing over daily CPL/CPA fluctuations without context. | Calculate your LTV and determine your maximum affordable CAC. Focus on the LTV:CAC ratio over a longer timeframe. | Gives you the financial confidence to weather daily volatility and make strategic decisions based on long-term profitability, not short-term panic. |
Putting all this into practice—rewriting your ads, restructuring your campaigns, building new offers, and tracking the right metrics—is a significant undertaking. It's not just about flicking a few switches in Ads Manager; it's a complete strategic overhaul. This is where expert help can make a huge difference, saving you months of expensive trial-and-error and getting you to profitability far quicker.
As a B2B advertising consultancy, our entire process is built around implementing these principles for our clients. We offer a completely free, 20-minute strategy session where we can go through your actual ad account and show you exactly where the opportunities are. There's no obligation, of course, but many people find that initial call incredibly valuable.
Hope this helps!
Regards,
Team @ Lukas Holschuh
