Case Study: An 80% Reduction In CPL For A Cloud Service Provider

About The Client

Based in Germany, HKZ is a B2B company that provides a wide range of cloud services for businesses of all sizes. 

Its services encompass multiple specialties, including cloud hosting, virtualized machines, and infrastructure management.

The company’s target customers are small to medium-sized enterprises looking to modernize and scale their IT infrastructure using cloud technologies.

During the third wave of the COVID-19 pandemic in 2021, HKZ experienced plenty of difficulties with its Facebook ad campaigns, including a high cost per lead (CPL) and a low number of qualified leads (who are more likely to convert to customers).

Back in 2021, we observed a peak in Facebook advertising. Businesses were moving their operations online rapidly due to the global lockdown.

This shift increased the competitiveness of Facebook ads and, probably, partly contributed to HKZ’s poor-quality lead campaigns.

However, at the same time, this also presented an opportunity for Infrastructure as a Service (IaaS) providers like HKZ to expand their market and scale operations.

Challenges For HKZ

The decline in qualified leads and the increase in ad costs posed a lot of challenges for HKZ.

Most importantly, the company needed to reduce the CPL of its Facebook ads, which was constantly skyrocketing high at over $70.

Also, HKZ’s marketing team wanted to reevaluate and refine their Facebook ads’ audience targeting to improve lead quality. 

Meanwhile, they looked to expand the brand’s online presence and cut down the overall marketing cost.

GDT Agency’s Solution

Our partnership with HKZ started in the middle of 2020 when the company was searching for a solution to optimize its Facebook ad costs.

We analyzed the case together and proposed the following solutions:

• Using agency ad accounts: GDT Agency provided HKZ with highly reputable Facebook agency accounts for rent, which helped the company gain an edge in the auction competition and optimize ad spending.
• Launching video awareness campaigns: We advised HKZ to run video Facebook ads for brand awareness instead of sales or leads. Awareness campaigns were cheaper and highly engaged. Video ads were extremely effective in capturing attention and attracting the audience to the first stage of the sales funnel.
• Testing, tracking, and optimizing: We tested different ad content and video versions, tracked metrics closely, and continuously optimized and scaled winning campaigns. 
• Running retargeting ads: Rather than running sales campaigns targeting cold audiences which were a waste of money, we focused on warm audiences. Using Facebook’s custom audience feature, we launched retargeting ads targeting those who engaged with the awareness videos or visited the landing page.
• Closing deals: The marketing team coordinated closely with the sales team to provide excellent consultations and increase conversions.

Results & Stats

After three months of collaboration following this integrated approach, we yielded remarkable outcomes. 

• The agency ad accounts saved us plenty of time getting ads approved and distributed. The fact that they had no limit on the number of campaigns and account spending thresholds allowed us to experiment with multiple campaigns and scale successful ones effortlessly. 
• With a nonstop effort in testing and optimizing Facebook video ads, we successfully found winning content that generated high engagement and clicks. 
• By leveraging Facebook custom audiences and retargeting ads, we improved the return on ad spend (ROAS) significantly and improved the general results by approximately four times with the same ad budget. 

The following figures demonstrate our significant achievements:

• The CPL reduced by 80%, from over $70 per lead to $14 per lead.
• Overall marketing expenses dropped by 38%, compared to initial costs.
• The number of qualified leads generated via Facebook ads increased by 36%.
• The ad spend percentage reduced from 80.65% to 28.74%.
• The average monthly ROAS soared from 1.24 to approximately 3.48.

Conclusion

By utilizing our premium Facebook agency ad accounts and sticking to a streamlined marketing strategy, HKZ not only overcame the pandemic-induced challenges but also capitalized on the online shift to scale its brand presence fruitfully.

Since then, HKZ has been an enduring account rental client of GDT Agency and has maintained a stable Facebook ad spend of around $7,000 monthly.

Thank you HKZ for trusting in our service!

*Note: Name has been changed to protect privacy.

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