The Chop Shop Search Arb Podcast

004 - This Search Arbitrage Testing Method has generated over 50 MM alone (copy/paste it now)

November 16, 2023 Martin Andersson
004 - This Search Arbitrage Testing Method has generated over 50 MM alone (copy/paste it now)
The Chop Shop Search Arb Podcast
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The Chop Shop Search Arb Podcast
004 - This Search Arbitrage Testing Method has generated over 50 MM alone (copy/paste it now)
Nov 16, 2023
Martin Andersson
Transcript

your chances of success are so much higher with a proper testing method. We have generated over$50 million with this specific testing method that we are going to talk about today. And the best thing is this is not rocket science. But just the framework that anyone can copy more or less directly and level up their game..

Henry:

Yeah, I think with testing methods, it's something that, there's a different testing method, like everyone we've talked to tests differently and. Like with what we do, it's been refined over many years of working with, in this case, Facebook. We found that it works pretty well and we've scaled lots and lots of campaigns with this strategy. But yeah constantly testing. It is something that Facebook, TikTok, they all recommend ads get stale, especially in this day and age. And so we have to keep figuring out new angles and that testing strategy becomes super important and keeping a campaign alive,

martin_1_11-13-2023_210910:

For the listeners or viewers that are not really sure, what do we mean by testing method? Put yourself in the situation that you're about to start a new arb campaign. How much, how many ads do you create to begin with, and what are you talking about in the ads? And at what point also, do you know that you've tested this specific vertical enough? Like I find many beginners, they often are too quick to say, oh, it's impossible to make money with this specific vertical. But in order to be able to say that you need to For yourself, know that you've checked all the important boxes that are there to experiment with just a bunch of testing in order to find out if something works or not. And if you have flaws in that or take shortcuts, you might very well be throwing away phenomenal vertical simply because you don't look everywhere for it to make it work, basically. So it helps a lot to have a. A clear framework when approaching a new campaign, I find so where, imagine I'm a totally new campaign manager. Like where do I begin? How should I think when I get a vertical assigned? And which platforms for clarity, which platform are we talking about? Because there are some differences dependent on where you buy.

Track 1:

Yeah, let's talk about Facebook today and yeah, if you were assigned a new vertical as a campaign manager and. You don't, you haven't run it before. I think the first thing would be to uh, start doing your research, and that kind of goes into our talk about the spy tools in the previous episodes. Learn as much as you can, what people are running right now, the angles that are being used. The kind of videos, uh, the style and Like the message the keywords that they're using. All of this digesting as much as you can. Because a lot of it, like you would be testing yourself and you don't wanna waste money running something that someone else has found doesn't work. Usually if you sort it in the spy tool by the most activity, you find the angles that work and you can kind of ba base your foundation around that.

martin_1_11-13-2023_210910:

Can you give example of a, of an angle for people that don't Might not understand or be confused with that term.

Track 1:

So a couple angles could be, for instance, like for dental implants, a price point um, a specific style of dental implants, different types that they offer, whether it's like a package deal. Things like that as opposed to something as simple as just search for dental implants.

martin_1_11-13-2023_210910:

I remember a super aggressive angle that was back in the wild west days of arbitrage that was very popular, that like now crazy new scientific method lets you regrow your teeth. You don't need dental implants. It was like, we never ran it, but in Some of those. Tools that show clickability, it was like always in the top. So there's two different angles. Your teeth can grow back or you can have them quickly, or you can have them cheaply or, so that's what we mean with angles we talk about.

Track 1:

All right.

martin_1_11-13-2023_210910:

Okay. We, so I, as a new campaign manager, I've then done my research. I've noticed what is the competition running? I've noticed which angles are there. and I would to stress that it's then important to test those different angles. also that you see, and that you should have an ambition to test different angles. Maybe you have an idea. Normally I discourage new campaign managers. Please don't come with any new ideas, just study what the other people are doing. But if you have the main Angles that are being run, feel free to throw in your own one or two to just give it a shot,

Track 1:

Yeah.

martin_1_11-13-2023_210910:

right? Test. What matters the most? First, like what's the most explosive thing you can try. Would you say that one should start by testing video and, image directly? Or how would you approach it?

Track 1:

Yeah, I, right now I would say video is performing the best for us. At least. It's where we have most of our testing focused right now. You have Instagram reels. All these platforms that Facebook's coming out with that are all really centered around video. So this is I think where Facebook sees its own future. That's where they're investing in. And so image, static image especially, or pretty limited in terms of placement and also growth in the future. Facebook is really pushing this video format wherever they can. So that's where we have most of our focus as well. Starting there usually is the best place. Once you've established the vertical, then you can start experimenting with images as well. YEah,

martin_1_11-13-2023_210910:

Yeah, that makes total sense. That makes total sense. And then how many videos, like how will we package it in the beginning? So how many angles, how many videos? I.

Track 1:

Yeah, usually once you've done the research, then you've boiled down to maybe three to four different angles, hooks formats that you really like. And that's what we would recommend. That's what all our campaign managers start with, usually between three to four. Is a good basis'cause that gives you enough coverage for that vertical. And they should be some somewhat different the angles. But like you said, they're all based on the best performing ones out there. You're not inventing anything new, uh, with this round of testing, especially if it's a new vertical that you've not tested before.

martin_1_11-13-2023_210910:

Yeah, to your point, I just wanna highlight they should be different. There's also. A common error when people start that they test a couple of different ads or angles or approaches, and they've, they're only very lightly modified.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

I, commend people that really dare to make it very different because only if you make it different, you're gonna have different results,

Track 1:

Yeah.

martin_1_11-13-2023_210910:

at this point, you want different results if everything is performing at around the same cost per action, That's a signal to you that you haven't really done this phase properly. I want to see big discrepancies in performance here to begin with.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

Okay. And if you if we take like the position of someone that's like a one man shop that's like just getting started, what kind of budgets are needed for this phase? How do we split up our money?

Track 1:

Usually, because again, if we're talking about Facebook, it's a bit of a longer learning period, so I. You have to give it the algorithm a little bit of time to learn in the span of like days. So typically what we would recommend is three to four days,$30 a day, and you're testing these these ads all in ACBO format. The best one ends up on top. And you can quickly after that three to four days, start seeing which of the ads have the best C Bctr, uh, the algorithm naturally starts shifting more of the impressions to the best ad, and that gives you a lot of data on like how to proceed what the next phase of testing should be.

martin_1_11-13-2023_210910:

So you have enough confidence in the algorithms selection of the winning ads to say I trust this. I go directly to. To CBO because a few years ago, I would've said we want like a scientific test or an ABO where you put like a budget for each ad in order to ensure that you burn the same amount of money in your testing, gives you a scientific answer, but perhaps Facebook has tweaked their algo enough to that we can trust it. Is that what the feeling is?

Track 1:

Yeah, like to your point, ABO used to be like, even for us, the dominant format that we would use. But we found really in the last two years or so that we were wasting a lot of money on ABO. We were testing a lot of ads that just didn't work. And thus, like even if it's 30 bucks a day, it doesn't seem like a lot. But if you multiply that by a couple thousand ads, your losses start to increase quite a bit with an A, BO, especially if you're always trying to get into new verticals with new angles. And each angle is different. There can't, they can't all be winners. We found that the CBO really helps test everything apples to apples, give the algorithm the three ads or four ads, and they all have an equal chance to win. And yeah, from that point on, the one that it allocates the most traffic to is the one that we base further campaign building off of. But of course, like, it gets into we'll get into it in a little bit about like how do we scale from this point, once you've discovered The winning ad in ACBO because the key of course, is always to keep testing new ads. You don't want, you don't wanna get stuck with one ad and someday it just stops performing. You're always looking for the next best thing, Which ACBO format is good for.

martin_1_11-13-2023_210910:

I, I tend to think about it as, as like a metaphor that you want to, like in the beginning, you want to zoom out in order to see different ideas, different angles, test them, when you found you win, are you zooming in on that specific, what you've tested? If it's then the angle or creative or what it now is, zoom in on that and you create more of The same in order to like fine tune within the winning approach that you found? Like, how can I make it

Track 1:

Yeah. Yeah.

martin_1_11-13-2023_210910:

How does that is that the next step that you would recommend? Or

Track 1:

Yeah. Once I would say, yeah, once you've determined the winner and the CBO, usually you can start, you could start to scale it. We found a lot of success, with the winning ad. You can duplicate it into a new campaign and start building it out from there. Different angles and different edits that you add can also be added into the mix to see for that fine tuning. There's a lot of data that Facebook also gives you about for a video, what the percentage play looks like if you're catching users within the first three seconds or 10 seconds. So this is all really helpful information that you can use in your edits for a video that's performing. How can I improve it even more? How can I edit it to have a more powerful hook or a better closing? So these are all angles that,

martin_1_11-13-2023_210910:

Said. Sorry, you said that you take the winning creative and you start a new campaign with it is,

Track 1:

can't, yeah, usually what we'll do. Is, so we'll have a testing campaign and that's ACBO. And we're loading let's say three ads every two days. And that's always in a new ad set. So we'll have a bunch of ad sets with with ads that are being tested. And this is just the testing campaign. Women ad set with its three ads, like once it starts to perform, um, then we'll spin it out into a new campaign and then focus on the scaling, uh, on that new campaign as opposed to Focusing on the testing one,

martin_1_11-13-2023_210910:

And the testing always stays a testing campaign.

Track 1:

essentially. Yeah.

martin_1_11-13-2023_210910:

Yeah. Yeah. Okay. Is the audiences and targeting and all of that's no longer, that's no longer a thing, I assume, huh?

Track 1:

We don't do so much of that anymore. We've always found in the past that when we do interest-based targeting, Really narrowing your audience more than it needs to be. Whenever we've done ab tests with interest based or regional, like targeting, the costs start to go up and we end up with a campaign that has less traffic, where the budget's not filling because there's just not enough of a, of an audience that, Or you can fill the budget, but your CPC just starts to grease to the point that you're not making any money. So broad-based for us has always been the focus.

martin_1_11-13-2023_210910:

Yeah. And okay, so we have a process where we've tried something, initial, we found the winning ad, then we've zoomed in on that ad with a couple of edits, various hooks. Do you also take that same concept and give to more creators if it's AUGC based campaign, or do you like really narrow down on this specific creator and edit? What would you recommend in that situation?

Track 1:

Yeah, like I think I would say we do both because if you found a really strong creative and this is a creative that you're spending hundreds or thousands of dollars a day on, it's good to always keep it fresh. The original video, like adding different elements to it, whether they be seasonal or. You can add like just some effects to it, just enough or different music, different, potentially slightly different dialogue. But the skeleton remains the same, like playing around with as many edits as you can while still keeping the video as close to the original as possible. So that's definitely recommended. So that you can keep squeezing as much as you can out of it. But also there are other it would make the most sense in parallel to also give these videos to other creators that they can recreate it, especially if it's with a specific script. With AUGC based, like the person is speaking into the camera and it's easily recruitable with different faces and different people, then that's that's definitely something that we should always pursue in parallel.

martin_1_11-13-2023_210910:

Yeah,

Track 1:

So you're creating like,

martin_1_11-13-2023_210910:

say if, yeah.

Track 1:

just creating substantially similar videos?

martin_1_11-13-2023_210910:

Yes,

Track 1:

Yeah.

martin_1_11-13-2023_210910:

and I would also. if you have the luxury to have the time to look at the comments. I think that can be valuable sometimes because we need to make assumptions on why something is working, the, comments can give us confirmation,

Track 1:

Yeah.

martin_1_11-13-2023_210910:

About it. Is it the music or is it something in the offer or is the creator in a specific way? Once if you have a good understanding for it, then I would then also recommend that you look over, like which keywords do you display On the cell side, because you've gone from this very broad area where you just, the keywords that you select in the beginning they can then just be like what's paying and has like somewhat of a nice meaning. But once you've zoomed in, it could be. That a different kind of keyword that's more closely connected to what the ad is hyping up, Be better.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

Is how is that looking in practice and at scale the keyword optimization? When do you in general recommend that this is worked on?

Track 1:

When we use UGC videos, it's always good to give the creators some keywords that will eventually show up on the page. thIs way they can work it into the script somehow if it makes sense. And so I would say it happens almost in the very beginning where you've determined what your keywords will be. You send that to the creators and they can brainstorm around this, the subject of these six keywords or however many you're using. But yeah, like you're,

martin_1_11-13-2023_210910:

good. Let's underline that again. You'll make a much better UGC order if you know what kind of keywords you're going to. Display

Track 1:

Yeah, for sure.

martin_1_11-13-2023_210910:

park page because that's your limitation, right? You need to find keywords with that commercial potential and they have some form of, gather some form of interest that you can promote it somehow.

Track 1:

for sure. Yeah. But it also makes a lot of sense because you're rotating keywords as well, that you're basing that off of, uh, what the comments are saying. What are people clicking on? What are people reacting the most to? So keeping it fresh with new keywords is always recommended, and, but as you're doing that, passing it back to the creators so that they can keep that in mind when making edits and new iterations of that video. the keywords and the testing, it's all very closely connected.

martin_1_11-13-2023_210910:

And at what point do you introduce still images?

Track 1:

For us. It really depends. It depends on the bandwidth of the manager and also if they feel they've tapped the potential of what they can get with video. Static images really for us is somewhat secondary. If we've tested a lot and we feel that, we've gotten all that we can get on the video side, then that's when we start testing static. but that really varies depending on the vertical. And of course the geo as well. So not really an answer unfortunately. But, um,

martin_1_11-13-2023_210910:

No, but you opened up just more, this is like a tree that's expanding of a lot and you mentioned geo. That's then of course also something, once you found the winner, there comes a time when you should consider, Hey, can I replicate this in a different market?

Track 1:

Yeah.

martin_1_11-13-2023_210910:

And then I think. tHe one with the least amount of frictions that you stay in. The same, if you are successful in the us why not test in Canada or UK or Something like that. But there's also a lot of money to be made. There's, that's no secret in, in the developing markets.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

Could be a good one or we've had a lot of Spanish ads flying around, yeah, we see, we just see that there's so many levers to pull, so it helps to have a helps to have a, system. I find that it's also Different. If you start out something completely new, some campaigns you're exploring with, you're trying to find out, is this something that's going to work? And once they've taken off and they're flying, then it's a bit of a different kind of campaign management that's, it's more like caretaking of the campaign. Would you, do you see it that way or is it

Track 1:

for sure. Yeah. Once that campaign reaches a point, again it's very subjective what that point is, but. There is a point where it becomes more of a maintenance, where you're focusing on what other new verticals you can get into. But like we mentioned earlier, it's still really good to always be testing in that testing campaign for the vertical. Just always be uploading different angles uh, testing things like every couple days we're always uploading Like three to four ads and a couple ad sets just to see if there's something else that will also perform.'cause every new creative for us that we find is an incremental amount of spend.

martin_1_11-13-2023_210910:

And this is also a nice thing if you want to expand. Span your team, say your one man show. The way I would recommend doing it, you can find a really cheap virtual assistant or like a graphic designer that you've tested, that they have some form of knowledge

Track 1:

Yeah.

martin_1_11-13-2023_210910:

some form of feeling for how marketing works. And you could, once you've established, once you have a winning campaign, you could give it to. To this assistant with very clear rules on how to refresh it because everything is already there. I took an approach that every other week I had my assistant look at are the ads that are within the campaign that they should remix them and create new say of the top two, top three.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

But then every other week I would like them to look outside again to do competitive research. It's just to highlight you should continuously also with your winning existing campaigns, make sure to continuously look at something changed in the market. So I would have done this existed every second week, look outward and take your favorites or what you think is the best one and try them versus the existing ads.

Track 1:

Yeah, that's what goes into what you called like maintenance mode. So like someone is always still looking at it and making sure that the ideas and the angles are still fresh, that we're testing something there. But you're focusing potentially more on expanding the vertical internationally, like getting into new geos or new new markets. But yeah, as far as The original campaign, it's always good to to still be doing something with it. You don't wanna wait until that campaign starts to die before you get back into the.

martin_1_11-13-2023_210910:

Yeah. Okay. So we have

Track 1:

Okay.

martin_1_11-13-2023_210910:

it, if you would present like the most important uh, levers that you should test and have, like in your system. We mentioned mentioned the angle, we mentioned different formats of the ad. and then we mentioned to zoom in on the winner. How important would you say that like the hook and the CTA is in this whole hierarchy?

Track 1:

Yeah, I think it's probably one of the most important when you are doing your research, like what are the hooks that really Are at the very top when you're sorting. But the hooks kind of span across verticals like

martin_1_11-13-2023_210910:

Yes.

Track 1:

they, once you've found a really strong one. And that kind of goes for the CTA as well, that a good one can be used across a lot of different style or verticals or campaigns. But it's probably the most.

martin_1_11-13-2023_210910:

that you see a lot now? Do you have an example?

Track 1:

Yeah, when we first started it was, when we first started, it was like, stop scrolling. That for us

martin_1_11-13-2023_210910:

Yeah. Yeah.

Track 1:

like the hottest one. It's not so much anymore, but but just having someone shout it into the camera was enough to see, like when we're looking at the stats that it seemed to be working.

martin_1_11-13-2023_210910:

Would comply. That's awesome.

Track 1:

yeah. Yeah, it's very strange. But yeah, CTA wise, I would say swiping up, swiping left, these kind of terminologies used to work a lot in the past as well, but lately we've tried to move away from that for compliance reasons. But really ending the script with a strong with a strong, sorry, my computer just shorted out here. Am I still on? Yeah. Okay.

martin_1_11-13-2023_210910:

Yeah. All good. I didn't notice anything.

Track 1:

Yeah, so strong ending, like an end hook I guess you would call it.

martin_1_11-13-2023_210910:

Yes,

Track 1:

and other

martin_1_11-13-2023_210910:

I would assume that's lower. That's of lesser importance than the hook,

Track 1:

Yeah, for sure.

martin_1_11-13-2023_210910:

right?

Track 1:

Yeah, getting the person to pay attention initially, um, that's probably the hardest part for us, or it has been in the past. So experiment a lot of different hooks and again, like these Facebook stats that are offered in terms of seeing which video has the highest percentage of three second plays and all that. It's been very helpful in helping us refine our strategy when it comes to hooks. But yeah, then the message itself, of course it needs to be somewhat interesting, but the hook is of course the, it grabs the attentions and we've tested with different hooks as well. There's, there is a trend, and I think there still is now, where you would just play a totally random video to catch someone's attention, and it would be sometimes.

martin_1_11-13-2023_210910:

screen or do you like do the split screen thing?

Track 1:

Both. It would be like a to, sometimes we'd see a split screen and sometimes it would just be like a whole video that is totally unrelated, just some viral clip, uh, just to catch the person's attention. And I would say like the performance of that was very poor for us.'cause you can have a hook and get someone to, to watch for one or three seconds, but. Like you can't trick them in this way. It needs to be somewhat relevant to the message

martin_1_11-13-2023_210910:

Good point. Yeah. Also, I experimented a long time ago with taking popular memes and try to like, squeeze them into the campaign that I was running. I said that just doesn't work.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

It needs to be very, I find it needs to be very clear. What's the benefit? It needs to be very easy,

Track 1:

Yeah. That's the whole hook thing. That's a whole, that's like a whole episode in itself.

martin_1_11-13-2023_210910:

Yeah,

Track 1:

we could talk about that for like hours,

martin_1_11-13-2023_210910:

really I, I'm looking forward to the hook episode. These are the hottest

Track 1:

hottest hooks.

martin_1_11-13-2023_210910:

dude, that's almost a hook in itself, huh

Track 1:

Yeah.

martin_1_11-13-2023_210910:

for a very nichey audience. Good. Yeah. Is what have we forgotten is that roughly the structure or

Track 1:

Yeah, I think that,

martin_1_11-13-2023_210910:

there?

Track 1:

I think this could be, this is like a multi episode thing. What we intended, but I think for the subject now, it's I. Those are the main points, like how you would start with a vertical, how you would test it, how many ads would you test, how many ad sets, CBO versus ABO, um, and then expanding internationally. That's like the high level as far as that goes. The testing for that.

martin_1_11-13-2023_210910:

So this could be a good lead magnet. If you ever want to build a, an email list like that, give us your email and you get the structure. So now we've given it in the talk format, but we could create APDF perhaps with it. Let's see. In the comments. If you're watching on YouTube also, we got our first comment on YouTube. Made us very happy. Got some praise there on episode number two. We read all the comments that come in, all this one comment that come far, but don't be shy. Let us know where you're watching from. Let us know if you would like a APDF that depicts it a bit more. Scientifically, and it could happen that we we created, like I iPhone, wanna fall easily for good feedback on flattery. So it will pay off.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

It will pay off. Nice. Oh, the last thing if I were like, if people ask you when have you, how many signals do you need for something? To be proven. What's the minimum say it's, do you do it like amount of clicks or amount of conversions? What's the minimum? When can you put it aside with a good conscience knowing that you've tested a certain step?

Track 1:

Yeah, that's, that's tough. I would say for the US it could be a dollar amount if you're testing US traffic. Usually we're comfortable at around$500 for a new vertical that we've tried a bunch of different iterations, that we've allocated enough per creative. But that's just for the month. Usually we'll go back and test it again like a month or two months later. But in that one testing cycle, just with the proper amount of creatives,$500 for us is usually a good, uh, indicator for us that, this isn't, we don't have the right angle or It requires more refining we'll revisit it again in a couple weeks but for now we'll move on to different other verticals that we're seeing for international, where the spend is much like it's, you can get an indicator with much less money because the cost is so cheap. thEre we would go with probably a click format. Where as long as there's been maybe like a thousand clicks or something, then then we'll know by then whether or not that creative is performing well and we're seeing that it's performing on the revenue side as well. Yeah.

martin_1_11-13-2023_210910:

Perfect. Yeah. They may have something to go by for all the Aspiring campaign managers out there.

Track 1:

Yeah.

martin_1_11-13-2023_210910:

Good. Hey, thank you very much.

Track 1:

Yeah. Thank you.