AoV vs LTV


A member in GM+ recently shared some wins from the $1 Product funnel they created and we've been helping with in the group.

Here's the deets.

It perfectly shows one of the key reasons I'm moving the vast majority of my own marketing to low-ticket offers, and why I advise you do the same.

People who buy once will buy again.

And that's super important.

A lot of the focus in GM+ is on crafting a low-ticket offer that has good initial average order value (AoV).

This is what unlocks low-risk ad scaling.

When your AoV matches or exceeds your cost per acquisition (CPA), you can - theoretically - run that funnel in perpetuity to keep bringing buyers into your biz.

Basically, for every $1 you put in, you get at least a dollar back.

Here's the thing I always remind people.

Look, you're unlikely to make a life-changing amount of money from the initial AoV.

It has one job. To unlock ads by covering the cost to acquire a new customer.

It's awesome to make a small profit here, but really, even a 1:1 ROAS is enough if you know what you're doing.

What do I mean by that?

Well, as I mentioned above, people who buy once will buy again.

You have to know how to get these initial buyers to come back and buy from you again. That's where the real money is made.

How do you do that?

On the back end through things like...

  • Ascension models (get them to buy a bigger thing)
  • Repeat purchases (get them to buy more)
  • Referrals (get them to refer new customers)

If you've got this locked in, over time you'll see what the member above did.

Take their October as an example.

They made $981 in profit for that month on a ~1.4 ROAS.

Not a huge life-changing amount by any means.

However, those people who bought in October continue to buy and, by December, had provided $2216 in profit for ~1.9 ROAS.

They've almost doubled the money they put into ads.

And that's just one of the cohorts coming through from their $1 Product.

What I'm trying to say is, for success, you've got to have both a long and short view on things.

Covering your costs in the short term is super important to make sure the biz stays alive and you can continue to attract new customers.

BUT, don't think that's all the money you're going to make.

A lot of the real profit comes down the line.

By focusing on serious buyers up front, you open the door for continue profit over the following weeks and months.

You have to keep this in mind, or it's easy to look at the front-end stuff and think "this ain't working all that well".

I've recently done a full ascension system and added it into the GM+ Archives for anyone to use to more easily unlock that delayed profit in their business.

If you want access to that and all the support we offer in GM+, join up now as the price is going up in 2 days.

Join GM+ before the price increase

Pete "delayed profit" Boyle

Vagrants, Vagabonds, and Villains Ltd, Unit 16535, 13 Freeland Park, Wareham Road, Poole, Dorset BH16 6FA
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Growth Models

I've spent ~10 years helping digital brands grow. I share what I know and what I'm experimenting with in this newsletter.

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