How does Google calculate ROAS? “Here’s the math: $5 in sales ÷ $1 in ad spend x 100% = 500% target ROAS” (Source: https://support.google.com/adwords/answer/6268637) Before I explain why ROAS kills profit, you need to understand exactly what...
Fundamentally, with pay-per-click advertising, the idea is to balance the cost per click that we’re willing to pay with the profit per click that we expect to achieve. As advertisers, we attempt to find the right level of spending that maximizes the business profit....
In a word, “No!” In two words, “Hell no!” In eight words, “No, because of the law of diminishing returns.” Here’s why… CPA, or Cost-Per-Acquisition, is a metric based on averages. It’s simply the average cost per conversion. If you’re not really clear...
Presented by David DeppnerMeet Magento New York, October 17, 2017 Competition for online advertising is driving up your costs, and it’s not going to get any easier. What can you do to improve your PPC advertising and get even more profitable? This presentation covers...
Would you rather have a 10% return on $100 or a 5% return on $1000? \[ \begin{align} $100 \times 10\%_{ROI} &= $10 \\ $1000 \times 5\%_{ROI} &= $50 \end{align}\] If you have to pick one or the other, you’d pick the $1000 investment at the lower ROI. In the...
