Hi there, it’s Matthew Larsen from Ultra Growth Marketing. Today, we are going to talk about why breaking even on advertising is STILL a HUGE win. This will be a shorter email, as it is more about your frame of mind than actual tactics or strategies.
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Why Breaking Even on Advertising is a Huge Win
Although it might not seem like it at first glance, breaking even on advertising is a huge win in eCommerce and business as a whole. Before I tell you why, I am not saying you should TRY to break even. Making a ton of money and having a huge Return on Ad Spend (ROAS) is obviously better than breaking even, but many people get discouraged or think advertising isn’t worth it if they aren’t getting a 3x, 4x, 5x, or 10x ROAS, and that is just not true.
I am not going to beat around the bush here because it really is simple. Here are some benefits of “breaking even” on your advertising that a lot of people don’t think of:
1. You are getting a new customer. That is big by itself. This new customer could love your product, and tell 10 people about it. For every customer, you will get more customers through word-of-mouth marketing, so although you are only breaking even while acquiring this customer, they may bring your more customers in the future that you didn’t have to pay any advertising to acquire. If you have a referral program or ambassador program, this is even “more true.”
2. You are getting more website traffic. This will do a lot of things, most importantly, will help you rank higher in search engines, and therefore, get more organic customers. You don’t have to pay for traffic from search engines, so these additional, future customers have no advertising cost and will make you a lot of money. Some people stop advertising because they don’t think it is worth it, and then their search rankings crater and they don’t know why. They just can’t put it together as to why that happened.
3. You are growing your social media and online audience. Most of your customers will follow you on social media, and like, and comment, and share your posts. This can be a good stream of new customers that you also don’t have to pay any advertising costs to acquire.
Although this wasn’t a traditional how-to-style email, this concept is very important to understand. Of course, you want to be making a 5x ROAS, but sometimes it just doesn’t happen. As long as your ad campaigns are achieving a ROAS that allows you to breakeven, you should keep them running. It is very important for all of the reasons outlined above. I hope this was helpful, and that you run your ad campaigns for years to come, even if you are breaking even or turning a small profit.
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