I’m not the fool, it’s them! How I earned 100% of my advertising money when I realized what reports I needed

At the beginning of my journey, marketers constantly brought me some reports. It’s a useful thing, no doubt about it. Everything seemed clear: advertising was on, people were working. Just all these clicks, views – what does this mean for business? I didn’t understand, because my main interest is profit. I felt like a fool….to protect you from feeling this way, I am sharing the benefits and tips.

Let’s figure out what you need to ask marketers in order to intelligently understand the meaning of what is happening.

Show me something else!

That’s exactly what I said at the very beginning. What’s under this others did I mean? Don’t know.

Often the owner doesn’t even know what he wants to see. It is clear that it is a profit, but even it must be properly documented. So much so that when viewing the reports, the owner or marketing director would not even have questions (and I had a lot of them). Or rather, they should end up looking like this:

  • What will we scale?

  • What should I turn off?

  • What is better to optimize?

  • What can be tested?

Only in reality this is what happened: the bottom line was that I received nothing. I had no understanding of where or why. Because based on the data that marketers brought, nothing can be done except look and forget.

And here we come to the most important scourge – laziness.

This problem is a consequence of the first two: you were given numbers, you have no idea what to do with them, so you decide not to do anything.

I trusted the contractors, paid the money, but did nothing myself.

This needs to be sorted out and analyzed. It’s tedious, long, difficult. In addition you are not aware of how much money you are losing every second.

Let’s return to the very first thought: everything works, advertising is running life is good.

Let’s look at a specific example. It will show you how much you can earn if you stay up to date with everything that is happening.

Initial data:

For example, I spend on advertising per month = 75,000 rubles.

I get 100 sales.

Price of 1 sale = 1500 rub.

Accordingly, the cost of attraction (CAC) is 750 rubles (75,000/100).

Let’s assume that the margin = 50%, and the net profit from one sale = 750 rubles. It seems that advertising does not bring profit, but only pays off investments in it. But then what is the chance that customers will return to you?

1 client can make several purchases, then the income (LTV) from him will be from 1500 rubles. But! If from the first purchase you spent money on attracting him, then from the second – not a penny.

Then you can easily calculate the return on marketing investment (ROMI). It is calculated using the formula (LTV-CAC)/CAC*100%. You will get ROMI = 100%.

Additionally, I earn 100% of the money invested in advertising. The channel is effective.

And I just learned about how much 1 sale costs, what the cost of attraction is and what income can be from 1 client.

But you need to know about this. Without knowledge, you will continue to spend your budget on finding new clients instead of simultaneously taking into account those who has already bought something from you.

That is why, to make important decisions, including scaling, optimization, removal, etc., you need to take into account at least 3 indicators:

  1. CAC – customer acquisition cost (in each channel).

  2. LTV is income per client for the entire time of interaction with him.

  3. ROMI – return on investment of marketing channels.

But you shouldn’t stop there.

Why couldn’t I understand the analytics?

Numbers without guidance or strategy are empty words.

Imagine that you have met your friend. He said that he entered the best college of service and nutrition to learn how to cook deliciously. He regularly goes to practical classes, where each time he is given only a list of ingredients and their quantities. No instructions, no recipe, no master classes. Only names of dishes and numbers.

Do you think he will make a smart chef? I think not.

It’s the same in marketing: without a specific “recipe” – no skills (in the form of scaling), no taste (in the form of profit).

But that’s not all. Ignorance does not exempt you from responsibility, especially for the loss of your own money.

When I systematized what I wanted to see, I realized how much money I was losing. At a minimum, I spent to see the maximum number of leads. But I didn’t even think that existing leads could bring profit repeatedly. And since there was no work with them, then the profit was x2…x3 too.

The less you know about your own business, about internal processes that cannot always be reflected in reports, the more you waste your budget.

This is where those same 4 questions will be relevant, especially about “what will we turn off?” After all, not every advertising campaign is profitable. And contractors are sometimes happy to work “idle”. And what? Everything works, there are leads.

But are there any sales?

Qualitative analytics

To help you figure out where to start, take a look at these questions:

  • How many clients came from this or that advertising channel?

  • How much did a client cost in each advertising channel?

  • How much profit did each advertising channel bring in?

  • What is the average bill for each product/region/advertising channel?

  • Which channels/advertising campaigns are useless?

*I’ll make a blot here. Channels and campaigns (even useless ones) also need to be divided into groups: in which customers make only the first/middle/final touch. This analysis will help either remove unsuccessful advertising or optimize it.

The same applies to product analytics:

Don’t forget about analytics by region:

Now that you’ve looked at the questions, answer the most important one: Which of these data do you have?

I note that in this case there will also be numbers, many numbers. But unlike simple clicks, impressions and views, you will know exactly what you are dealing with and how much you get for it.

You can press any button, but without “that one” there will be no qualitative growth.

Marketing report

So, you have worked on your awareness, understood what you need, and weeded out unscrupulous contractors.

Another question arises – how to achieve the goal? How to ultimately get the necessary numbers and useful information from contractors?

Remember that the essence of the report should reflect:

  • real indicators;

  • explanation of the reasons for the numbers;

  • dynamics (development or decline);

  • plan for the next period.

As for the indicators, they will be as follows:

  • ROMI (explaining how the company recouped its marketing costs);

  • applications (in units and in%);

  • cost of the application (in rubles and in dynamics);

  • quality of applications (cold and warm, target and non-target clients);

  • LTV (calculation of how much a company will receive and how much it can spend to attract customers).

These are the most obvious and important indicators that an owner should see in a report from a marketer.

When all the numbers are visible (not only to marketers, but also to you), life becomes easier.

First, your eyes, which until recently were the size of your orbit, are getting smaller. Secondly, you clearly see who, how much and when.

In addition to these indicators, the report must contain information on the following points:

.

Qualitative analysis and the corresponding report allow you to most competently:

  • distribute the budget;

  • formulate a development and optimization strategy;

  • assess the state of the business.

Therefore, stop staring at dry numbers, and demand from your contractors normal, well-developed analytics that will be of interest to everyone.

Conclusion

I walked this path from ignorance to truth on my own. There were many mistakes, hypotheses, etc. But in the end, I was able to systematize the reports and come to the conclusion that even the owner must have information that, it would seem, is relevant only for marketers.

But no!

Impressions/clicks/views/likes/comments – the stone age, in which there were no specialists in effective advertising. It’s time to start living well (or, finally, clearly plan such a life).

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