Boost ROI: Using KPIs to Diagnose Meta & Google Ads Issues Like a Pro

[00:00:00] The reason I created this is to help understand, on the one hand, how to inform customers about their bottlenecks and how to find solutions to resolve them. If I'm not explaining myself well, or if there's something anyone would like to analyze in more detail, just tell me to stop and together we'll take a step back. Okay, it

[00:00:36] probably looks a little scary to watch, right? Like all these ridiculous numbers suddenly. Okay, I'll explain. Actually, it's not that far- fetched. And there's a bit of preliminary work to do to fill it all out, but the reason I created this is to help understand, on the one hand, how to inform customers about their bottlenecks and how to find solutions to resolve them. My Siri turns

[00:01:08] off. Go away. Okay. I'm sorry. I don't know what I said to make him continue, but, essentially, it's about figuring out, you know, "these are your bottlenecks," and then it's up to us, as strategists or managers or whatever you want to call it, to understand, "well, this is the root cause of those bottlenecks and how are we going to solve them," in essence. So I'll

[00:01:40] briefly talk about each version and then go into the details of each one. Version one calculates spending based on a set AOV and CPA, and I assume the percentage of customers. So let's start with a revenue target that the client gives us. In this case, we are only using a general 10%.

[00:02:03] They want 10% growth starting in 2024. So it's easy to calculate. From there, the first step is to understand what the customer breakdown should be. This is fairly specific to Meta, but I think it also applies to Google. It's about figuring out, you know, what the benefit is to have a new customer versus a returning customer, and where we should be spending our money.

[00:02:27] What should our customer allocation look like? In this case, given that its AOV is slightly lower and its cost is slightly higher for new users, we will have a lower percentage of new customers. We always want to remember that we need new customers, but depending on the customer's objective at any given time, we have to work with them to determine what that percentage represents. In this case, 30%

[00:02:55] seems reasonable, and that's where they've been for the last two years. I'm getting ahead of myself a bit, but version one basically calculates spending based on your CPA for new customers versus recurring ones. Version two uses a fixed budget to calculate the cost you require. So, in this case, let's say a

[00:03:25] client comes to you and tells you that they need to increase their revenue by 10 % this quarter or this year. And besides, he only has X amount to spend more. So, you'd say, "Well, we don't have any room to maneuver in allocating the budget." So we'll take that at face value and say, "We have $290,000 to spend in the first quarter." How do we break it down to be as efficient as possible and achieve the revenue target you want? Basically, what it does is

[00:04:00] tell us: "This is the cost that is actually required" and then we can dictate what percentage of customers, of each type of customer, we target. In this case, you can say that we were given that expense of 290. We break that down into three months and then say, " Well, this is the approximate cost we're going to need to reach that figure." And, uh, yes, this one is a little more simplistic, whereas version one, I think, allows us to tell the client and say, "Hey, if you want this revenue target, we recommend allocating, you know, whatever portion of our budget we think is needed to achieve a 30% new customer rate." We believe we can achieve these static AO goals. Normally

[00:04:57] , what I do is take the AOV from the most recent time period for 2025. So here is our overall AOV, here is the specific AOV for new customers, and here is the AOV for recurring customers. And the reason this is important is because it helps to understand how much real revenue can be generated from that specific type of customer. For

[00:05:20] example, in this case, recurring customers have an AOB of $73. Okay, that's great. Multiplied by the number of recurring customers we are going to get, we can see that we will approximately reach, if everything goes according to plan, $564,000 of our total revenue of $86,000 from recurring customers specifically. And then we have to

[00:05:48] see what the required acquisition cost is. This is where I think it 's most important for us to understand it. Well, AOB is pretty much what it is. You know, there are things you can change here and there, generally on the user experience side and on the actual web development side, bundling, upselling, you know, raising prices if necessary, that has an effect. But for us

[00:06:16] specifically as paid media managers, the cost required per new customer compared to the returning one is where it's going to be incredibly important. In fact, we used this for a client recently and broke it all down for them, saying, "Okay, this is the customer segmentation I think we need.

[00:06:35] Our AOV is a huge bottleneck. Our cost per acquisition is a huge bottleneck. How do we solve these problems for them?" And that's what Melissa and I were talking about, basically, sending a breakdown of how we think we can solve each individual problem for them. For example, I believe that in their case, AOV is

[00:06:57] directly related to their conversion rate, and since they have a very low conversion rate, that AOV isn't necessarily the top priority. Therefore, in that case, we focus on the conversion value. In contrast, with repeat customers, a great lever that the customer can activate is email marketing. That will make a

[00:07:22] big difference in what it actually costs the client to acquire a repeat customer. Regarding metadata, I believe that's where we can really dictate the CPA of a new customer. In their case, $45, which represents a year-on-year decrease of 17%. How did we get to that point? Well, that's where we need to

[00:07:46] step in and say, "Here's XYZ on how I think we can solve this problem." But it doesn't just highlight, you know, what is necessarily an hour-long span, but it also gives the customer feedback on: "Well, your repeat customer price or your cost is relatively high." I think you should reduce it. This is how

[00:08:06] we would recommend doing it. And the same with your AOB and then dictate that customer type division. So, it's likely to be a little convoluted when you first look at it, but I 've found it really helpful, and I think clients really grasp it when they sit down and look at it and say, " Okay, this actually makes sense.

[00:08:29] I can see why you're telling me I need to spend an extra 71% this year just to hit that 10% revenue target." So yeah, that's my little pitch, but I wanted to talk about this—kind of an evolution of the My Tracker stuff I 've been dealing with with specific clients more recently. And a client came to me