Creative volume at different levels of spend
How many ads does a $250k/month client have?
Not for the first time I’m talking about creative volume.
We first covered this last year when I mostly referenced it in relation to media spend. Then back in April as part of my Creative Diversity post, I shared our formula for how much creative we typically work towards.
Last week, I saw an extra piece of data that adds to this whole puzzle.
Varos is a company in the States that gives you benchmarks for how your CPAs, CTCS and CPMs are doing. It’s a smart idea: you plug in your ad account and in exchange for sharing your data, you get access to lots of other data out there. We trialled something similar last year.
Yarden Shaked, the CEO and founder of Varos, shared some great data last week that ruffled some feathers.
This was the headline of that data.
This groups ad accounts into a few buckets: $10-100k/month, $100-500k/month, $500k-1m/month, and $1m+.
Now most of you are UK or Europe based. The UK is a 5x smaller market than the US, and a market that is far less consumerist than US equivalents. That means spend levels are always higher in the US.
The other thing to consider is that US CPAs are almost always higher as well, met with also higher AOVs.
So if you’re looking at that thinking ‘wow, $1m/month feels miles away’ that’s okay, for the UK market size equivalent, it’s definitely a smaller fraction of it.
But looking at this data, there’s a few things you will notice right away.
<$100k/month of ad spend, the average number of live ads is 102.9
$100k-$500k/month it’s 334
$500k-$1m/month it’s 422
$1m+ its 456.
This was based on ads that received over 20 impressions or more. Now, our own data shows that Facebook Ads follows a Power Law (see below).
What this means
Correlation does not mean causation. If you have 30 ads live in your account, then 10xing it won’t mean you can spend $250k/month. But this data reiterates what we see in our bigger accounts, it reiterates what we see from Meta, and it reiterates what we hear from experts who run 8-9 figure brands. Creative volume is essential.
This is also the number of ads live. What’s the ratio of ads that were created to get to the selection of 334 that you were happy with? My guess is at least 2-3x that number when you factor in variants as well.
There are some schools of thought out there that you should never turn an ad off, and if you’re running CBO Cost Control campaigns, you never need to. For most advertisers, Cost Control is a fantasy that never really works.
It’s also interesting that the volume per $ spent decreases. My bet is that somewhere between that $500k-1m/month or the $1m/month is the incrementality ceiling of the channel for many of those brands involved, and at that stage each new creative is producing diminishing returns.
But the vast majority of advertisers don’t sit in the $500k/month+ bracket. The majority are spending £5k, £15k, maybe £50k/month.
And in almost every account I’ve audited over the last year, the creative volume has been orders of magnitude too low.
If you want to move from spending £30k/month to over £100k/month, one of the requirements is going to be a dramatic increase in your creative volume.
If you’re looking for creative support, we now provide a standalone creative retainer alongside our core offering. Drop me a note to say hi: josh@weareballpoint.com.