the media buying structure that prints like a mf
The speaker explains their media buying structure for creative testing, recommending ABOs (Ad Set Budget Optimization) over CBOs (Campaign Budget Optimization) because CBOs require constant daily budget increases to accommodate new ad sets, which creates allocation conflicts between testing and winning creatives.
Summary
The speaker discusses the complexities of scaling media buying, contrasting it with the simplicity of creative testing. They detail their current media buying structure using ABOs rather than CBOs, noting that while the structure is identical, ABOs provide more granular control at the ad set level.
For creative testing, the speaker recommends organizing ad sets around unique concepts, with multiple variations within each ad set. They introduce a budgeting formula based on target CAC (Customer Acquisition Cost): multiply the target CAC by the number of ad variations to determine the ad set budget. For example, with a $50 target CAC and three variations, the calculation would be $50 × 3 = $150 per day.
However, the speaker acknowledges this is a theoretical "perfect world" scenario. In practice, with total budgets of $500-$1K daily, dedicating $150 per ad set to testing is excessive (representing half or a quarter of total spend). They recommend reducing this to 50% of the target CAC ($25 per ad variation), bringing the example ad set budget to $75 daily.
The critical reason for switching from CBOs to ABOs is the budget allocation problem inherent to CBOs. With a CBO structure, the speaker found themselves constantly increasing the daily budget to make room for new testing ad sets. As testing ad sets accumulated at $200-$500 each, they consumed an increasingly large proportion of the total budget. This created a conflict: with minimum spend requirements on ad sets and a fixed CBO budget ceiling, there wasn't enough budget to both meet the minimum spends of all testing ad sets AND allocate sufficient budget to winning creatives. ABOs solve this by allowing independent budget control at the ad set level, preventing testing budgets from starving winner performance.
Key Insights
- Testing creative is simple, but scaling media buying is where complexity emerges as the primary challenge
- The speaker switched from CBOs to ABOs specifically because CBOs require continuous daily budget increases to accommodate new ad set additions, creating a zero-sum competition between testing and winner budgets
- In CBO structures with minimum spend limits, the proportion of budget consumed by testing ad sets can grow so large that there's insufficient budget left to meet both the minimum spends of all ad sets and allocate meaningful spend to winning creatives
- The theoretical budgeting formula of (target CAC × number of variations) is too aggressive in practice, and the speaker recommends reducing it to 50% for realistic testing allocation within typical $500-$1K daily budgets
- The optimal structure for creative testing treats each unique concept as a separate ad set with multiple variations nested within it, maintaining organizational clarity across the testing framework
Topics
Transcript
[0:00] What's complicated with media buying is scaling. Testing is incredibly, incredibly simple. So, the way that I have my media buying structured right now for creative testing, I switched everything to ABOs. And I'll tell you guys why I do [ __ ] over CBO. It's the exact same structure as CBO, except obviously you're going to be controlling the budget at the ad set level. You just have a little bit more control. Now, each one of these, same as my CBO structure, is still structured as one unique concept. Here, we have another net new concept. And here, we have another net new concept. And then for budgeting, what I would recommend is your target CAC per…
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