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Ellen Ave
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Professor Charley T: Spending $500M+ On Facebook Ads, The '3-2-2' Ad Buying Technique, and More
Have you ever wondered how to run Facebook Ads? Professor Charley T (known as CT The Disrupter) tells all. Including a crazy story or two.
Episode 125: Fin (@barneybarnett01) and Charley (@ctthedisrupter) discuss how Charley spent over $500M on Facebook Ads, the reason Facebook groups was invented - because of one of his ad campaigns for 1-800-FLOWERS, created and popularised the 3-2-2 Facebook Ad Buying Technique, and turned his life around from being a junkie and addict, to becoming the 'Alex Hormozi' of Facebook Ads.
It's been a crazy ride for the guy. We just get to sit back and enjoy the ride too - in today's episode of Ellen Ave.
Enjoy!
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How much has he spent on ads? Like millions of dollars on ads, Probably over the last 10 years.
Professor Charley T:I stopped counting at like 500 million and that was like 2018. And it was like just because gifting and it was just like, let's say, in a smiley face, it ended up like making Facebook groups happen. I was a bad employee, so I got to be in a lot of different rooms, but I was a smart cookie, so everybody wanted me there.
Professor Charley T:So I had the luxury of basically being the like star new employee every six to nine months and yeah right. And so the smartest people in the room took me under their wing to try to like mold me into what they wanted. And then they realized, oh, this guy's never going to be a good employee. And then they sent me on my merry way and like a decade went by and so I ended up just like kind of getting exposed to stuff in a way that I was really lucky to. When you know what can I say? Like I do have an MBA. I've got like multiple college degrees, not because I'm smart, but because I was a junkie and I just wanted to be a good employee. I was a junkie and I didn't realize they had to pay back student loans, so I just basically suffice myself as a strung out heroin addict by getting new student loans, getting another college degree.
Fin:We're live, let's do it. But I'm actually so. I'm so keen now that we're recording to get all of this info from you. We've been chatting like last 30 minutes and it's real. I really like when I get to know someone and they're the exact person that they are on the screen, like they're not bullshitting, and so.
Professor Charley T:Yeah.
Fin:I'm stoked to have you here, bro, like the Facebook ads expert, the old Alex Hormoziov of ads and yeah, and just get everything.
Fin:I can from you and I know everyone will be everyone listening will be like real chuffed as well to learn a lot from you. You got like heaps of people already around you 10,000 subscribers on YouTube, a few thousand subscribers across like Instagram, tiktok, um threads I that's - I feel like threads is kind of where we connect a little bit more than it is to be honest, I don't know how that happened, but that's what we found each other. Yeah, it works, we found each other.
Professor Charley T:Yeah.
Fin:So, um, I'm just, I'm real keen to talk to you today. I think you spent, like how much you spent on it? Like millions of dollars on ads, probably over the last 20.
Professor Charley T:I stopped counting at like 500 million and that was like 2018.
Fin:Yeah, that's crazy. There's just a crazy amount of money.
Professor Charley T:I legitimately had a seven figure daily ad budget for a while. I'm like drop a million. Today, like I've been there and it's not. Like, oh, my agency has done all of this stuff and it's people know. Like, literally like I lost sleep because I was worried about, like, where the comma went. I made a typo once and was a fifty thousand dollar mistake. Like, um, yeah, I like I said around like 2017, 2018, I kind of just stopped counting.
Fin:Hmm, that's, yeah, it's. It's so cool and I've been watching a lot of stuff like on the tick tock on the YouTube, been following you for a while and I really like just how you think about Facebook's ads in general. So I think, yeah, I'm keen to just rip in and have a chat about everything, bro, and about the journey in terms of how you got to where you are today and and like what you think about ads, how you run ads. I know you're really, really into the broad versus like really specific targeting stuff. Yeah, but a couple questions for you at the end and then ask how you do all the business stuff as well. So let's get to the first question for you, just like ripping in, like how did you get to where you are today? Like what's, how did you? How did you get here?
Professor Charley T:Yeah, I mean to be fair, I mean it's such a long story. I mean you know I was a, went to college, got a real good drug habit, became a tour musician, serious sex and radio personalities Hulk Hogan, sex tape room, my radio career and girlfriend got, went to rehab, banned, kicked me out and I was basically just an opportunity to get sober and get my shit together or or die Jails, institutions and death. And so I, being a fucking being, a stubborn cockroach, I basically just made it out and California got sober. I got like 11 years clean now and got a job. Like moved to LA on like a Monday, got a job interview on like a Friday at this like illegitimate social media ad agency social media agency this is before Facebook ads or before like most people were doing it and had that job for like three months and then, like they lost their biggest account, so last hired, first fired kind of situation, took one of their clients with me and then started my own agency, ended up on the show from on AMC called the Pitch and ended up winning the last episode of that show. It was like this reality show of two ad agencies competing to be the agency of record for something.
Professor Charley T:So is one hundred flowers trying to figure out how to spend a hundred thousand dollars on promotional campaign, but you could only do it on the internet, which, at the time, was crazy, like like the idea that you would spend a hundred thousand dollars on social media was was was an insane ask, but the idea at the time and this is really before ads were around, but the I mean they had been around for a little while, but I wasn't using them yet. This is maybe 2012, 2013. There was this one hundred flowers has this like five dollar cookie. That's a smiley face. And so what we did was say, ok, a hundred grand, I'm going to give you a cookie and a voucher and then you can basically give somebody else, you can pay it forward, right.
Professor Charley T:And then what we did is like all right, facebook, we're going to do this thing to pay it forward. And then let's just make like this page where everybody that pays it forward can like see each other, and it ended up becoming like Facebook groups, which is wild, and because that really didn't exist. Well, you had pages, but this is like a group, a community, and so that was cool that that ended up working and it was like just because gifting and it was just like, let's say, in a smiley face I ended up like making Facebook groups happen and for a while there too, starbucks and some other places you could buy a gift card like randomly inside of Facebook for people and buy them cards. They don't let you do it anymore. I don't know why, but it was around for like three to six months and that was an offshoot of the tech, because we were like you can buy it. You can basically forward one of your Facebook friends.
Professor Charley T:That is cookie right, and so they just kept the functionality and tried it out with a couple of advertisers, but anyway got the big contract. My business partner that I started with was this like Sharkey lawyer Inc isn't even dry. He fires me. Apparently, I wrote a contract. I signed a contract where he was paying me 2K a month and he could fire me whenever he wanted. So then started another agency, a social organic, for about another three months and my biggest client fired me because he was like look, I'm still buddies with this guy, but he's like you know. I put 100 bucks into Facebook and it did more for me than I paid 2000 a month on organic social. And again, this is like 2013,. Right, spring of 2013, something like that.
Professor Charley T:Yeah, and so I, like my wounds eight, you know, had some carbohydrate therapy that night and then put my credit card into Facebook the next day and started promoting my band. And within three months I was running ads for Jamba Juice and Viking River Cruises. Within six months, I was doing stuff for like Jane, silent Bob and like Robert Rodriguez movies and like Comic Con appearances and stuff. And within nine months, I got a job as supervisor at Omnicom for their West Coast office for performance media, basically managing paid social for brands like CBS and Nissan and working with like Activision and Levi's and Apple.
Professor Charley T:And yeah, I went from basically never having a real day job to I got a suit from a fast fashion like H&M like a $40 suit, got the job interview and I went from basically being unemployable to like being my own boss and getting fired every three months to here's the damn near six figure income with full benefits and everything. And like I was wearing cowboy boots and like band T shirts, torn up jeans, I was showing up late, I didn't know how to use Outlook so I could never send emails to anybody and like they knew I was a bad hire pretty quick but it was corporate America, so it took like nine months to fire me and over that period of time I was spending seven figures a day on Facebook in like 2013.
Professor Charley T:Before there was a Facebook pixel, like it was like you could only buy like clicks or page likes or like engagements or views or something like that, and so I just started running case studies and internally, and I got in trouble, like what they ultimately were able to fire me for was I was running case studies on client money and publishing them by basically sending it out to at all at Omnicom, which I thought was just the office, but apparently was Omnicom corporate, and I was just like, hey, I spent a million dollars for CBS yesterday and we quoted them or no, we quoted them a million dollar budget and, to be fair, I was getting paid 75 K a year plus benefits, so ended up being like 90 something thousand a year, awesome paycheck. But we had a 20 percent commission on ad spend. So if I spent a million that day I'd make 200,000 a profit for my company. So you figure, 200,000 a profit, do that every day for a year and they're paying me like 75 K. I did the math in my head real quick and I was like this is kind of nonsense. And, to be fair, most ad agencies to this day do that. Like you look at I won't name names, but there's a lot of ad agencies that I call out often and like they might pay their buyers like 70, 80,000, which sounds like a lot. So you realize the really charging clients 20 to $50,000 a month and they pay the person that does 90 percent of the work like a thousand bucks a month and they just give them like five or six clients and then if the client leaves, they just give them a new one. But there's never any support, there's bad training and it's just like the unit economics are ridiculous.
Professor Charley T:But anyway, point is we caught them a million, me looking out for the client. I figured out a way to overdeliver, basically reach more people in America more often than the original quote, and I did it for like 800 grand. So I saved the client 200 Gs and I walk in there proudly, send this case study out to everybody and they're like you just cost us $40,000 in a day and you did it seven times this week. Then you wrote a case study that you sent to all employees about what a great job you did and then that was like what they needed, right. So that's where I'm. A 30 day plan and bottom line is from there.
Professor Charley T:I bounced around from ad agency to ad agency, brand side and stuff like that ended up in a place called 310 Nutrition and I came in there. They were doing about 15 million. About 20 months later we were at about 100 million, started. The Facebook Disruptor Group with the original brands was developing Power 5, so it was in the original case studies for like broad targeting, advanced matching, cbo, dynamic ads.
Professor Charley T:Part of my job at Omnicom, oddly enough, was I was the first guy to run a lead gen ad and then later on I was the first guy to run like a DPA ad for Macy's and then I get this job at 310 Nutrition and I was the first one doing a lot of these other things that are now just standard practice, like dynamic ads, cbo, broad targeting, all of that stuff, and worked there for a while and it was the first job I didn't get fired from. I got poached. Basically we went for a buyout from Deloitte. It went south at the last minute like the 11th hour. They were like there was 98 million. Let me not claim nine figures, there was 98 million 2 million.
Fin:I'll keep it up. I'll be honest, real quick, 100% not my money, by the way.
Professor Charley T:I was just an employee, but I did have a knack of getting fired and basically getting a new job that paid me a little bit better, which was awesome. I got fired from the 75K job and I got a 90K job, which was great, especially when I was used to working for like 10 bucks an hour or being a junkie that was trying to beg, borrow and steal anything just to not die. So it was a pretty nice little change of pace. I went from basically being destitute and unemployable to like I have no idea what I'm even supposed to do like taxes, because I've never seen this before. But yeah, so anyway, vice president of there came from Guthrie Rinker, moved on to another company. Afterwards he got hired basically on a Tuesday on Wednesday, brought me in, is like the first hire, is you, we need to get this guy.
Professor Charley T:And then the owner of that company was like basically back to Brink's truck up to my house and was like you're not leaving here until you say that you're gonna come for this job. And I say, all right, fine, I'll do it. And it's like a Wednesday and he's like, all right, cool, I'll see you tomorrow. And I'm like I still have a job. I gotta give him like my two weeks or whatever. He's like all right, so we'll give you equity or like profit sharing points and I'm just like fine, okay, whatever, I'll just do it. And I'm like dude, I also have a bachelor party, like next week. Someone to be gone like it was like cool, so come and grab a laptop on Thursday and I'll see you in like two weeks. He just didn't care, like he was not, he had this guy sold, I think, reunion in classmatescom back in thecom bubble, for, like you know, I never need to worry about money, ever again. Money when he was like 25, and that was like 20 years ago.
Professor Charley T:So like I was not leaving that room and not being his employee, basically, and then that is crazy.
Professor Charley T:And during that time, like I got booted out of all the Facebook groups and because I'm really bad for these, like funnel Facebook groups by, you know, common thread and Thai Lopez and all these other like really low integrity folks and the Tim Bird's of the world and whatnot and so I ended up making my own Facebook group because when I left the agency, well, I didn't have anybody to talk to. So I was like I went to Facebook and like joined all the groups which now existed and I realized there was a light years ahead of everybody and so I started to answer people's questions. I got bumped. I got literally kicked out of every single group that you can join on Facebook that has Facebook ads, like in the title, like the hundreds, hundreds, and, to be fair, I was spamming them all. I was just spamming them all with good information, but whatever.
Professor Charley T:they seemed to frown upon that and I started my own thing and I was just like I'll go live once a week on a Saturdays maybe 2017, 2018, I'll go live for like a week, an hour every Saturday and just give a class and that group like 13,000 people. I started a Patreon because I play with like fantasy football, fantasy sports, and I'm just like all these guys, all these YouTubers have a Patreon.
Professor Charley T:I'm for like five bucks where you get their info. I was like I've been answering the same question over and over again. I wrote the answer in like a little PowerPoint deck and then like a 10 pager and it was like hey, you can get all my answers for like five bucks. That thing grew and grew and ended up being like $20,000 a month and then, like I started to get into more coaching and more business development stuff. Covid happened, worked from the house, had more time to work on it, really built out a business doing that, you know, and by that time I've been going live like every week for maybe 40 years. So I got real good at it and, being on radio personality, like I'm proving right here, I can talk to you at brick wall for four hours and completely entertain myself.
Fin:Well, you're entertaining me and everyone as well.
Professor Charley T:I'm talking to you on a journey. Yeah right, it's the storytelling, I think, is the key and 100%. And basically they were like, hey, covid, restrictions are kind of lifting in LA, so you want to come back to the office. And I was like, no, why don't you take your laptop? And I got a severance. They basically bought me out of the you know the points or whatever they'd given me, and meanwhile I'd gotten a second job at home.
Professor Charley T:So I was starting, I was doing my own Patreon thing we end doing that and doing this business called my Life and we were spending maybe 50K a day, something like that. It wasn't, you know, maybe a couple hours a day max work. And then I started training ad agencies how to function. So there's ad agency out of Canada that I was working with and some other ones and I was just building agencies up for people, because I accidentally started a couple agencies sitting at my desk because, like, running Facebook takes a couple hours a week. So, like at 310 Nutrition, I think, every year, when the new season of Game of Thrones would come out, I would spend like the two weeks before watching every episode in order at my desk and then, like I do it, I do that with.
Fin:Marvel movies as well, whenever there's any one I watch every single one there, yeah.
Professor Charley T:You get the saga. You know what I mean. But I would just sit at my desk watching shit and we'd be like, what are you doing? You should be working. I'm like, look at the Shopify we hit 100K. It's like two o'clock in the afternoon when I came here. We were doing 25.
Professor Charley T:Like I'm good, I'm gonna go back to my show now. And like they gave me too much, I was just like see you guys, I'm gonna go to Chipotle and drive home. Like once you hit 100K, I'd peace out, Like if it's 11 am or whatever, I don't care, my job's done for the day. And so I was doing different things and basically at that point it was maybe two weeks before my wedding and I was like I'm done, I quit, and they bought me out of my deal and I had launched, I had taken what I had done for ad agencies and that summer, or that I'm not saying at the same time, about a month before, I had made it available for any marketer, any brand that wants to replace their agency or any marketer that wants to be an agency or any agency that wants to get better. And that was the Facebook ads of the A program. And long story short, like. I made my annual income at my day job in 60 days and I was just like.
Fin:I quit.
Professor Charley T:My mom was like you quit your job two weeks before your wedding. I'm like ma, I'm paying for this wedding in cash. We're good, and basically since then I've been unemployed.
Fin:Bro, that's crazy, and you just did such a good job of like you just did such a good job and I honestly felt like that was two minutes and that ended up being like 10 minutes. But you just gave such this good like overview of how you got from I don't know like the last 10, 12 years to right now, and I felt like the whole time I was like living right there with you.
Fin:Oh, thanks Bro you're such a good storyteller, like I think the energy and the intent behind that comes through and that's why and obviously the radio skills and you've been going live for ages and everything else as well comes into that but it was like so enjoyable. I felt like you covered everything, but not too much.
Professor Charley T:Thank you so much.
Fin:Yeah, that was great.
Professor Charley T:I tried to skip around. I mean I skipped. There's a million sagas in all of those 15 different life stories. But like, yeah, like that's. Yeah, there was that's amazing on the cake, man.
Fin:The Hulk Hogan thing. There's the base of groups as a result of the 1-800-Flowers thing.
Professor Charley T:There's like a Legion as, which is weird to think of, just like, oh, we had this idea. I'm sitting at a diner in West Hollywood and I was like what, if it's just because we just send these things off and we make a button and then we just group them together and, okay, cool, now they're Facebook groups. Like that is bizarre. And I'm not saying I'm the engineer of like, I just gave them an idea and then they ran with it, but that's the tech they had to build to execute the thing for 1 a hundred flowers, because it was on this. It was the show that came on after Mad Men, and so, like Mad Men, you know, on aim With great show, and there was a show that came on afterwards and they were like, well, uh, we should probably do this thing, these, this team, one 100 flowers wants to do it. Oh, let's give it a shot.
Professor Charley T:But that's a car man.
Fin:Like how you've been involved in quite a few of these like pivotal moments of Facebook, oh yeah.
Professor Charley T:Yeah, like, it's like 100%, like Tom Hanks or like slumdog millionaire. Like, yeah, all I've done. All I've done was be the guy self-deprecating enough that can like interview well, and it was smart enough at one thing or another to place the previous life Event to the next thing to the next thing to the next thing is just like. I was a bad employee, so I got to be in a lot of different rooms, but I was a smart cookie, so everybody wanted me there. So I had the luxury of basically being the like star new employee every six to nine months. And yeah, right, like, and and. So the smartest people in the room took me under their wing to try to like mold me into what they wanted. And then they realized, oh, this guy's never gonna be a good employee.
Professor Charley T:And then they sent me on my merry way and like a decade went by and so I ended up just like kind of getting exposed to stuff in a way that Was really lucky to. And you know what can I say? Like I do have an MBA, I've got like multiple college degrees, not because I'm smart, but because I was a junkie and I didn't realize they had to pay back student loans. So I just basically suffice myself as a strung-out heroin addict by getting new student loans, getting another college degree which works in retrospect.
Professor Charley T:Yeah but you know, like I just had giant checks written to my name and like, cool, now I don't have to have a job, this is great. I'll go be a radio DJ and make nothing but drink for free. This is great. Hmm and worked out. I don't recommend this path to anybody, yeah, but there are some lessons hopefully in there for people.
Fin:Well, I just think it's cool, even like how you say you know you bounce around jobs but you had that six or nine months of being that star in your employee. You had you know like ten different experiences of probably people who, one way or another, had something On you in terms of knowledge or experience and that all, yeah, you.
Fin:And then you will fold that into everything you do, like just getting from the point from where you were doing like social media, to then paydads. To then let me like work with real big budgets and my god, facebook's got nothing right now. So let me figure out how I can best give the clients results that is being millions of dollars but there's no data. And then, yeah, into the next thing and then scaling that as you found your models in your systems and like now, yeah, you and and Facebook's probably changed a lot, but I know now you're quite big on the whole Broad, targeting dynamic creatives, like let Facebook do the work and be really bored, as opposed to Targeting what's what, what is your kind of? Do you want to go into that a little bit more around like Facebook ads?
Fin:Yeah, so I was listening as a business owner being like I want ads or I want to do this.
Professor Charley T:What's like the best yeah well, let me, let me give it just a quick backstory on this and then dive into it. So One of those things about being that guy with the seven-figure budget and whatever else. At the time, facebook was like a weird platform to advertise on, like everybody that was good was doing Yahoo search. So just yahoo Time that exists in what a time right yahoo search, oh my yeah, yeah, oh.
Fin:It's platform.
Professor Charley T:Oh, dude, if you were good at yahoo, you you could pay the bills. You were, you had a job for life. So basically what happened was like there was like one Facebook rep for everybody, like West of Chicago.
Professor Charley T:Hmm so, when they came to the office, nobody wanted to talk to but all I did was Facebook, right, and so, because of my, because of my work, like that was all that I was doing, and so, basically, what ended up happening? We brighten this up a little bit, there we go. So what ended up happening was I Made friends the engineering team, I made friends the product team and I got to know, like, how they were doing each step of the way. Every time they were doing things because, like they were like, hey, we need to figure it out. Like the lead gen ad, they were like when we built this thing, nobody wants to use it, but we need somebody who's willing to spend X amount of money. It's like I have Nissan and I have to do an alpha three times a year, four times a year.
Professor Charley T:I've got like two weeks to go, spend a million dollars on a new idea and then like, well, okay, let's give it a shot.
Professor Charley T:And so, like the first lead gen ad was trying to run, could we convince people to sign up using the internet to arrange a test drive at a car dealership, and it worked.
Professor Charley T:Now, like a lot of car dealerships have people like signing up test drives and like it, it cost us maybe a hundred bucks to get somebody to take a test drive of a car and, like one out of two, you know, I think. Well, it was 50 bucks to get somebody to sign up on the lead and one out of two bought a $25,000 vehicle. So, like we're doing the math, it's like a 250 X row, as stupid. The point is, though, like I Was there helping them out on a lot of the steps for making a lot of the things, because I had a really big budget, because I was constantly popping up with new clients, new problems, and also I was willing to take their work, and I was willing to make mistakes because, obviously, like I was sending out case studies of doing everything wrong to use the platform Properly the whole data like Facebook loved me, right.
Professor Charley T:Facebook is like oh good. So I ended up working with them on how it worked and especially, the most important part is Towards the end of 2017, beginning of 2018. Facebook made a huge shift. Up to that point, they were trying to be a version of Google display, where you randomly showed ads in somebody's Experience and you bid on, like how much you were willing to pay for us a click or impressions and all of that stuff, and they could track the conversions and all sorts of fun things.
Professor Charley T:Hmm what happened in 2018 is Facebook made a shift, fundamentally Um, to favoring the customer experience, and what that means is like, if you remember back in the day, you used to see all of your posts on Facebook in chronological order, right, everything on Instagram was like the chronological fee, and then it was like oh, we're just gonna show you the things you like. Well, what happens when you show you the things you like, they also realize shortly thereafter that like. Well, they can use that same thing for ads. And so broad targeting the brain behind is something called advanced matching. Broad targeting is basically saying don't do any targeting, um, and If you don't do any targeting, we'll make sure that the people who most want to see your content see it. And so if you focus on making sure that the people who want to see your content get to see it, then it's really easy to say well, if we give people what they want, does it also drive sales? And the answer is yes, mazel tov, and the answer is no. Well then, figure it out. And that's infinitely more powerful than let me try to rent information from a third party, like using interest group or something like that.
Professor Charley T:The way an interest group works is people come to Facebook With, like credit card information or user databases in a million different ways. They rent that information for Back in the day they literally used to tell you how much they're renting for it. It's been hidden now. But let's say it cost them ten cents for every thousand people and they'll turn around and charge you five bucks for every thousand people. So the cost of advertising goes way up.
Professor Charley T:I and you're also basically saying I'm going to pay extra to make sure that the majority of people who want to see my content don't, but people based off of some subjective term or keyword are and they think, well, I'm selling dog stuff. So I'm going to just target dogs as an interest group but say you're a cat guy and you're like man, cats rule, dogs jewel, like just hate dog. You're using the word dogs, so you're interested and, to be fair, two thirds of the audience in an interest group is thereby mistake and regular. Every year colleges do case studies on like how accurate are these audiences, and at best they're like two thirds accurate. Sometimes it's half, so it's a third.
Professor Charley T:So if you think one third of the audience is there by mistake. And then let's say half the people in that audience are there because they don't like something. Like if you go to a restaurant and you don't like it, you're probably going to tell a lot of people. If you go to a restaurant, it's all right. Maybe you tell people, maybe not. So you'd much rather have kind of like that secret spot that you enjoy going to, unless it's amazing, like oh my God, you got to go. But if you have a bad experience, it's a little everybody. Yeah, people do that every facet of their life. So let's just say it's conservative and half the people that mentioned something do it because they're not happy with something. And you see, this especially happened during like political times, like during elections and like if you talk about the person you don't like, you're going to see a lot of content mentioning that person because it's engaging to you, like you want to see it. You might not like it Objectively, you might not like it, but subjectively it's keeping you engaged.
Professor Charley T:Facebook is going making you from like a lean back experience. Blah, blah, blah, blah. So what they call lean in where you get to lean in, you're like oh my God this thing right and what they're trying to do is just maximize the time on the platform and, believe me, I'm getting to the answer. I'm just setting it all up. So Google and Amazon and, to be fair, also like email, their focus is to get you to less recent email. Their focus is to get you to go to Google. You search something, the first results you want, and you're off of Google as fast as possible. Like the Google perfect experience is somebody's on for like a microsecond and they're gone and they're happy, and then they come back and do it over and over and over again. Facebook, on the other hand, their business model is let me keep this person on the platform for as long as possible.
Fin:Yeah.
Professor Charley T:So their focus is to give that person the best user experience so they stay on for as long as possible. Not that they want to and yes, obviously they want to come back but they want to keep them on as long as possible. The way they do that is they show you content you want to see. The average person swipes the height of the Eiffel Tower on their device on a daily basis. According to some yeah, according to study that Facebook has been quoting for a long, long time in other platforms.
Fin:Crazy.
Professor Charley T:I feel tower right. So the point is for your advertising, you could try to say that I want to pay Facebook, I want to have Facebook by data from somebody else and then sell it to me at a profit, where I know that one third of those people are there by mistake and probably have those people don't like, don't like what I have to say and then I'm going to focus on that last remaining one third that they've identified and force my conversation, force my ads onto them to make them buy. Problem is that's not sustainable.
Professor Charley T:That makes Ad fatigue happen, like if your ads fatigue, it's operator error. Yeah, it also means that your costs are going to go up every year because Facebook is seeing you force your content on the people, not earn the attention of people based on merit, right. So what happens is Facebook says, ok, well, look, you want to play this game. Fine, we'll make you pay more money to reach these people and you're going to reach fewer of them and you're going to probably reach as fewer people more often and you're going to really annoy some people. And, look, you're probably going to get some sales but as a result of you being a lower integrity business partner, we're going to just continue to raise your rates because basically, your business model is, as an advertiser, that using interest groups or audiences, behaviors etc. Saying I want you to force my content on the people, regardless of their experience. And Facebook says our business models the best experience. So if you're business and the way that you advertise is to directly disrespect your business partner, odds are it's not going to work out very well. Any partnership you have where your standard operating procedure is to disrespect people you're partners with not going to work. So, bottom line of all of that, the way to be most respectful and to get the lowest costs and to have the most incremental lift to all other channels and also get premium inventory.
Professor Charley T:Where you show up earlier in the feed for lower money is to use dynamic ads so that Facebook's AI builds ad experiences that are best for people, instead of you guessing what people want to see and that's what 322 ads comes in. And use broad targeting, which is basically age, gender and location, which are the three parameters you don't pay extra for. There might be countries you don't want to target, might be genders or ages, you know, whatever it is, maybe you want women over the age of 45 in the United States? Boom, awesome, that's acceptable, totally. And so then, in that market, it's, can I earn attention? And that the attention that I earn doesn't translate to sales Now becomes a really easy conversation. Did my ad earn more spend? Yes, okay, great. Did it earning more spend also make an impact on my bank account? That is good, yes or no?
Professor Charley T:And if you can't tell me the answer to that question, then you don't know what you're doing with your ads, and I would say 99% of people who run ads have no idea when any one particular ad is doing to the rest of the bank account. They're just saying, oh, my row, as is good, that's a completely fictitious number, like it doesn't mean anything. And so, like we keep things simple, we use broad targeting, we use dynamic ads, so the deliveries based on merit, and then your job is to learn spend yes, awesome. Do my bank account go up? Yes, awesome, that's a winner. To learn spend yes, awesome. Do my bank account get better? No, it got worse. Okay, that's a loser. Did it not earn spend? Okay, it's a loser.
Professor Charley T:Well, now, like a 16 year old kid should run your entire Facebook ad account with like 30 minutes training, like somebody, like.
Professor Charley T:And basically the idea behind all of this is McDonald's has a thing called hamburger university, where they basically teach operators how to make high school kids able of capable of running million dollar restaurant locations. That's nothing to do with the competency of the kid, it's the competency of the system, and Facebook is the single smartest machine learning environment, using artificial intelligence to ultimately curate human behavior. One way or another it can condition human decision making and we've seen that go for good things and we've seen that be used for really bad things. There are those lot of examples of that, but ultimately Facebook's infinitely smarter than Google or Amazon Because it has basically 80% of the world's traffic and it's got more or less several billion people on every word that they've ever used on all of their devices and every transaction they've ever made in any store in person, online, because, like also, if you go with your phone into a store and buy some shoes on your credit card, facebook knows you were in this store at this time, bought this thing with this credit card, you know.
Professor Charley T:Whatever, and they have these models on every single person. That is trillions and trillions of data points.
Fin:And so that's why you feel like it would be better to just be broad, because Facebook already knows all of this, so leave it to Facebook.
Professor Charley T:Yeah, so your job is just like can I earn attention? And when I do, doesn't help my bank account.
Fin:And so that comes down to simple. And so when you're talking about earning attention, that's when it's like that's why it's so good to have different iterations of ads to test, and your focus is on making a really good ad that's really engaging, it speaks to the customer, like that's why knowing, I suppose, who you're trying to reach is really useful, because that would help with your messaging, same as the content and engaging content. And then that's where that 322 application comes in in particular as well, that you actually started yourself as well. Yeah, we were talking about this before we started recording and I was saying I did not realize that you were the guy who started 322.
Fin:I like remember seeing a few months ago on TikTok, this like Asian chick was like oh, if you are not using the 322 method, you've got to get on it now, and I was like, wow, that's a crazy simple, great way to test using like different creatives. And then I really love it because you can take the winners and scale them and then keep the other one testing. And it was you. Yeah, 100%.
Professor Charley T:And I built that years ago and it's been in development for a long, long time. But I've been teaching that for two, three years. I mean. I've got viral YouTube videos, my version, a couple hundred thousand. We looked at the numbers before this, was it 330,000 views or whatever, and it predates her video, but I think about a year and a half and it's me showing you how I built an ad on Facebook that spent $2 million and I'm just like here's how I did it, like it's not hard.
Professor Charley T:This is what I did and every step of the way I think and I got it into it less than a minute like easy and that 322 thing.
Fin:So do you want to walk that through? So it's three creatives, two copies, two headlines. What's like the sort of process of it, because that's what takes like your approach of let Facebook decide, be real broad, let Facebook knows best. This is like a really good actual application of it. So how does it actually work?
Professor Charley T:So the way it works is dynamic. Creatives pair all of your ads together in a way to try to give the end user the best possible experience. So if you have three creatives, two headlines to copy, you do the math that's 12 total variations. Now you can make 12 total ads and kind of do it manually. First off, that's painstaking and you're probably going to make a mistake. Lord knows, if I have to make 12 ads, I'm going to have a typo on at least one of them. It may very well have started out of self preservation from getting ridiculed for like typos and sending emails out to a whole database.
Fin:Oh yeah absolutely Like self preservation right. Work smarter, not harder. Yeah, absolutely.
Professor Charley T:And then. So the point of that is that is, when you build 12 ads, that data is being collated into 12 different files. If you look at it as like a folder on your computer, it's 12 different files. When you make it a 322 ad, dynamic creative, the Facebook is just looking at the folder itself. So it's not letting each. All the ads work in conjunction with each other and they're complementary in compounded value. So you have in compounding interest in the data set versus cannibalizing each other, where the ad that works is probably the one that got a couple of good comments early or like had a nice like hook rate or something that has nothing to do with performance. So yeah, and then the way we look at it is these creatives. Ultimately, each ad needs to answer a question. Really, what we're doing is just breaking down elementary school science class. It's scientific method.
Professor Charley T:I have a problem. So I have a video coming out on the channel as we record this. It'll come out, I think, in 24 hours or 12 hours, but by the time somebody sees it it'll be live. But I'm making an ad for Hexclad, the Pots and Pans company, gordon Ramsay's cookware brand. Yeah, so let's assume the problem is we're having trouble scaling because we're having trouble filling the funnel. Okay, so that's our problem. Our hypothesis is going to be well, if we use really engaging content that people really want to see, we're going to reach a whole lot of people and get them really interested. So that's going to fill the funnel, okay. So then the video is.
Professor Charley T:I go to the organic social and I find, hey, there are three videos that look similar Because we're going to try to solve the problem in the same way. There are three videos where Gordon's being a, he's goofing off, he's taking a piss out of himself, he's just having a blast, he's driving a forklift and hit something, or he's just goofy, whatever it is. They're like fun, stupid little videos. They all basically have a million views, cool. So let's find what worked and had a million views.
Professor Charley T:They're all of the same concept. This concept is Gordon's kind of being a goof, and they're highly public. So they look and feel the same, although the content itself is a little bit different. So now our hypothesis is if we run these ads that earned a lot of reach organically, where they're all kind of Gordon being a goof, we think that we'll get a lot of spend because people clearly want to see it because it works well organically and, as a result, it will fill the funnel and let all of the other ads that kind of do some retargeting or stuff like that. It'll let them have more people to touch. So we're going to reach more people and let more people know that X-Cloud exists and get them interested.
Fin:Awesome.
Professor Charley T:So now the scientific method applies and like, okay, well, we have a control environment, our best ads and we're going to run this against that in a CBO campaign. And they're saying, great, now the test goes live when we launched this does it earn spend? And if it earns spend, does our bank account look better? And the answer is yes, awesome. We have an ad and what we can do because we have the three creatives. If it doesn't work, we can say if any of the delivery was, you're going to have one or two things either one ad is going to get all the spend or the spend is going to be kind of evenly spaced amongst all three. Now, if the spend was evenly spaced amongst all three, then you know it's not really the creative on why it didn't work. Like, just this is an idea doesn't work. Now, if all the spend went to one video and it did poorly, well, we can remove that video if we wanted to. Or we'd like, hey, no, this video isn't it Right, let's try another one. Now, it'd be fair. Probably I would just turn it off and move on.
Professor Charley T:But we have the choice. We can be very binary. Let's say we have seven or 10 of them in there. It would take forever. For us it's not well. All three were even and one got a lot. It's probably going to be. One gets 80%, 70%, one gets like 20, something else gets 15 and you have no idea why. But when it's three it levels off or it becomes hyperbolic really fast. And the same thing happens at the creative I mean the copy. Maybe one headline gets 90% of the spend or they're both even. If they're even, then you know, hey, the headline doesn't matter, yeah, if the copy's the same cool, they're the same Then this copy doesn't matter, which means write two new sets of copy for the next test, because this clearly has no impact on performance. It was even. None of them were better than the other ones. It didn't really move the needle at all.
Fin:No, no, clear winner yeah.
Professor Charley T:Yeah. So we have a binary choice. Did it get spent? Yes or no? If it got spent, did it help things out? Yes or no? And if it did, if it earned spend but it wasn't helpful, was one copy or one creative get all the spend in the world, yes or no? Or was it even yes or no? All the answers are yes and no. Logic trees and you'll be able to know that answer really quick. So the beauty of it is it allows you to make what used to be an art form and, to be fair, I'm not saying the creative director's not important. Look, people that are really good at making ads. When they use dynamic creatives, they're phenomenally better than me making an ad. I'm terrible at making ads.
Fin:Good at making them spend, though. Oh, I'm good at that Absolutely.
Professor Charley T:Um and uh. So yeah, like that makes it just so easy. You know what I mean. And um, because of that, uh, you know, it just becomes like there's objectively no reason to not do it, because ultimately, all you're gonna do is, if it spends and makes your bank account better, then every iteration improves your situation, and as long as you're continually getting better, then awesome. And then, if you're just on the path of continuous improvement, yeah was your oyster.
Fin:So so then, and then you have this next step as well, of like, when you find that one, you put that into like a winning ad set or campaign A, but then you introduce new ones to test.
Professor Charley T:Yeah, depending if you need to. I mean, if your target cost for a sale is 50 bucks and you're coming in at 42, just spend more money. The reason you were launching new test is cause you're not good enough. If it's working, why?
Fin:fix it.
Professor Charley T:I think one of the biggest problems people do is they. They launch creative tests for no good reason. They try doing a landing page test for no good reason, like if the biggest problem you have is you have an untapped potential. Just tap the potential, spend more money. You like job done. Go, come back next week.
Fin:And so you, you, you, you'll, you'll find that winner, or you'll find, like, when it's working, and then you, you will just straight up the spend day. That's what I like. Is that, like, everything is really simple with what you say? Like it's quite. You know, there's a method to the madness, but it's quite simple and it means that anyone like listening to this, could go ahead and be like sweet, like I know I've got a good product and I've got a good business, or I want to validate this. I'm going to run some ads. Let me just test broad. Let me just chuck in some ad sets. Let me use this three to two thing, like, let me run it, let me see what happens. If it works, spend more. If it doesn't, try new stuff, yeah, and go from there Like it's.
Professor Charley T:It's literally as simple as that, like when you think about it yeah, and as long as yeah, and as long as you're getting better, awesome. And if you're so good that you're making too much profit on each sale. Spend more money. And maybe, maybe your objective is like I don't have infinite money, I can't spend more. Okay, cool, keep, keep at it and just keep making more profit.
Fin:Like awesome. One of the other things that you say that I really like, bro, is that you it was like that line about amplifying the business and like if you're relying on ads to make money, then you've already lost, or something around that, and it was I really liked that thought because it was like one thing that I see a lot with businesses and like I'm a young pup, I'm yet to go on this journey where, in 10 minutes, I can rip off how I was here, there, everywhere, with all these crazy like things, but I still have like, even in the few years of stuff that I have, I see so many businesses try to do things or try like market or try get out there when their product is just trash or like they don't have a good business model or they don't have logistics down packed or they don't have.
Fin:You know, they don't even know what their product does or who it does it for, and so I really like how you have that sort of thing as well. Did that come from trying to push bad products for businesses throughout that sort of 10 years of doing Facebook ads?
Professor Charley T:I think I've been brought aboard a thousand sinking ships. It's like the Titanic already hit the iceberg, bro. Like I don't know what you're expecting me to do and I went in there. I went in there with like an ego and just like I can fix it and be fair sometimes, yeah, I staved off death for a good too long and but yeah, it was really like, if you think about it is Facebook is a business model amplification device. Spend your profits on ads to make how you make money, to make more of it. This is how I make money. All right, I'm gonna run Facebook to do more of this. Awesome. If you're not making money, don't run Facebook ads.
Fin:How much do you think you should be spending if you're like, for example, someone this thing is making, you know 10 grand profit a month right now, or something like that. How much percentage of your profits or of your revenue do you think like, as a good guideline for people, to spend on ads?
Professor Charley T:I mean honestly, like I think that's one of the hardest and questions to answer, because it really comes down to your business needs. I mean, is it you and it's all thing, and like that 11K pays for your mortgage and like the two employees you have, and puts food on the table for your family? If so, then like maybe don't spend a penny of it. If that 11K is, after everything, you're just like this, just sitting in the bank, then maybe spend all of it. You know, like I mean, maybe all of it's a bit obtuse, maybe don't do that, but like the point of it is, I think the right answer is different for everybody.
Professor Charley T:What I like to do is say, when you're looking to get started, build a runway, I have this much money to spend over this much time. Say it's 10k over the next three months, my job is to make sure that I don't run out of money. And then eventually, that point in time where you run out of money gets pushed further back, because now you're making a little bit, you may. You know, if you spend a hundred bucks a day and on Monday you make 50 bucks and you make 50 bucks for a couple days, well, that day you run out of money gets pushed back two, three days. So your job is just never run out of money.
Professor Charley T:And if you can figure that out, mazel tov, and if you don't figure that out, well, you ran into it with profits that you could afford, based on how your business was working. And you know, know how, no foul, it didn't work out for you and it maybe you know. I mean, it's an investment. Everybody's got to take risks. I've dumped money into business, into my business where it didn't work out like you know you don't have to win.
Professor Charley T:And if you're already making money and Facebook ads aren't the way to do it, do more whatever's making you money. And that's why I always say like it's a business model amplification, so if your business model sucks, you're just gonna lose money faster.
Fin:Yeah, I love it, I do have. I have one. One more question because I'm conscious of of the time. I have one.
Professor Charley T:I got a wife texting me we're supposed to go get some baby clothes.
Fin:Apparently I'm like 20 minutes late, so I'll hurt you with one, one last question, and that was that someone sent in and we sort of talked about it before we jumped on recording. But, in terms of you, how are you making money right now? Like, what does that pie chart look like and what are those bits that that are part of that pie chart like is it 30%, of course? Is it set? Like, what does that sort of look like for you? And like, yeah, like, just tell us about that. That was someone that wanted to know.
Professor Charley T:Yeah, so a lot of what I do right now is sort of under the umbrella of disruptor enterprises and there's really three parts to that. One is disruptor school, which is like 500 bucks a month. Sort of that old patreon that we talked about is now grown into a slack channel with years and years of education and ebooks and lectures and guest speakers and a whole bunch of other stuff. And I still go online.
Professor Charley T:Just, you know, my time when I was, you know, sidelining at a day job versus me running a business, might make times a bit more valuable. But now, you know, it's a two pre-recorded classes a week and then a live session every Friday, and then on Tuesdays and Thursdays we do the replays of all the live sessions because there might be that live session is I just take questions, so that question might be a 10 minute answer, sometimes it's like 40 and then the next week that answer gets posted up and we follow back like how's this work for you, get you feedback, get you positive support, and if you weren't there and you missed it, hey, get to see it, you know and that way, there's this just great community and every month people can come in, they can leave when they want to, and the way I see it is just like if I can't help you make 20 more bucks a day, then clearly I'm not good at my job.
Professor Charley T:And as a business model perspective, my LTV on my customer goes up every month because majority of people don't leave. Yeah, it's great and it's. You know, if I have to do two classes a week because I have, you know, too many people, awesome, I'll do it. And then the other side of the business is Facebook ads MBA program, which is that thing was talking about training the agencies and then just turning that into something to help people, and it's very much a similar model. It's a community weekly class where I do a lecture for half an hour and then take questions, and then all those lectures and all those questions are available in an archive. It's searchable by timestamp and all of that good stuff and there's like 10 courses inside of it and guest speakers and more education.
Professor Charley T:And the difference is disruptor school is an entry level. It's above entry level. I'd say entry level for me in that I've got a business that works. I need to round out my education and so there's as much conversation there about business model development or running things on Amazon or Google, all of the other things it's great like if you're a CMO. It can be kind of your like secret back pocket, little like I need some place to go and ask questions yeah, awesome, right, that's what it's perfect for.
Professor Charley T:Mba program is like do I want to be better than 99% of people the world at this thing that can fundamentally change somebody's life? And you know like, if you're working at it, either ad agencies that might pay their buyers 75k a year, they might be charging their clients 20, 30, 50k a month. If you've got five or six clients as a media buyer, you're basically being paid a thousand bucks a client and your boss is getting paid 20 to 30,000. You could go through the MBA program and basically, like I let me get two, three clients, I'm gonna charge them all two, three, four thousand bucks a piece.
Professor Charley T:I'm gonna undercut my boss, basically still do all of the work anyway and I'll make 100,000 a year and I'll work like part-time, like why not? It's absolutely, it's for. Or if you're a brand that has an, it's just a contrived agency taking advantage of you. Like why don't you make your receptionist the best media buyer in your company? Let's do it it's funny with.
Professor Charley T:Jason from hexclad and this is like a little spicy salt, throw it out there. Just there's this guy, zach, who has an agency and everybody knows his agency because, yeah, hexclad to make it happen. Well, I talked to director hexclad and he's like we haven't seen that guy in two years. I don't know what he's doing. We put all of our internal teams through this other agencies thing and I was like, cool, all right, well, that's good to know.
Professor Charley T:And I met with Jason, the CEO, and he came up to me at an event where I was sitting with Nick Sharma and he's like, hey, man, big fan of yours, blah, blah, blah. I'm like I have big fan of yours. And he's like, hey, my son just got a job working for Nick, was gonna learn how to be a media bear. I'm gonna put him through your school, awesome. And I turned to Nick's like, hey, nick, this kid's gonna be the best guy you've gotten three months. And like, yeah, like this kid fresh out of high school is gonna be the number one media buyer and in that, in that environment, done easy. And so there's that and there's an entry level and there's a higher level, enterprise level of that.
Professor Charley T:Then the last thing is disruptor agency, which is a brand accelerator program, or basically what we do is we, if we find that your business is can, is work, can work, we'll come in and work with you on the business model and also work on like the ad side of things. We'll clean up the ad account. You know, if you've been working with like a common thread or a you know, you know any one of these I shouldn't get into too many, but like if you guys run by an Ashton or a Jordan or a Taylor or any of these other clowns and like you've just been sick and tired of being taken advantage of, come in, we'll clean it all up. We'll make it really easy for you by basically implementing all the things that we would do in the MBA program and while that's happening, we get the workload way down. We'll probably try to do that two extra business, maybe 90 days, 100 days while doing it, making it super simple so we can hand it off back to you where we train you along the way, work with you on the business model, and then my focus is let me do that as many times I can to help as many people be successful and the end of that contract basically looks like. Let's get to the point where you don't need us in the day-to-day operation and instead we can work you on business model development. Maybe we'll get a little piece of what's going on a little profit sharing or a little performance incentive or an equity deal or whatever that looks like, and every business is different. But the point is, can we make this work for you? And my confidence level me able to work for you is almost a hundred percent if we're gonna take you on, and what I look for is businesses that are good and what's wrong is their business.
Professor Charley T:Their Facebook ad account doesn't make sense and the way they're trying to spend money doesn't work. First scaling their business and that's that's fishing a barrel man. I can, I can, I can. Two ex a business doing that every day and all I do is I take my best MBA students, I give them a gig and then we work on. They get real world training and I work and they become my execution alarm and I work with them directly.
Professor Charley T:So I train them more and we just help business owners see the success that they deserve and try to make ourselves obsolete, and we get a little bit on the back end of it and they tell ten of their friends about it and a couple of them got something going on. And it's this self-perpetuating flywheel of like just creating joy and success and opportunity so people can feed their families and create jobs for their community and not fall victim to this like incredibly predatory, low integrity, like alpha bro, small dick, energy environment. That's the ad agency world. And man I should be dead and every day I get to spend my time making people's lives better and man I'm I'm genuinely this just like normal happy go, lucky dude all the time, because my days just spent the people saying thank you all the time. And I get to solve puzzles and make money like it's the greatest day, I got the best gig in the world you know oh, that's basically it's.
Fin:It's. It's so cool. I think like hearing that whole sort of story of what you've been through to get to where you are, like how you've come up you've been a part of some crazy things with Facebook hearing, yeah, you know like how you've come up with these, like tools and tricks and systems along the way, and then what I what I like is that when you watch your videos, you're incredibly talented at keeping people hooked in and you have really good energy and you have really good intent. But then what I also like is you know, like if anyone listens to this and goes and watches the YouTube, like you get to the end of the YouTube and like even just like there, you like go to this other side, which is just so sincere and so like genuinely grateful for what you do because you actually really like it. So it's yeah, it's super inspiring and I wish I had another 10 hours with you to ask all the questions.
Professor Charley T:But I know you want to let me back any time you want, man, but I gotta. I gotta go take care of the wife and baby things yeah, you go take care of the wife and baby thing.
Fin:Man, I really appreciate your time and I'm so happy that you came on. Do you want to just quickly plug yourself so that everyone can find sure?
Professor Charley T:yeah, find me on the internet. Ct the disruptor, disruptor school. If you type in disruptor school onto your internet or later and it doesn't pop up, then you shouldn't listen to anything I have to say.
Fin:I love it. Yeah, I love it so much. All right, all right, man.
Professor Charley T:I'll see you later, man much for your time.
Fin:I appreciate that awesome.
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