Setting A Goal For Your Digital Advertising

revenue: the only goal of digital advertising

Ask any business owner or CEO if they want to grow their business and they will ask you if it’s a loaded question. They will always say yes to the question of growth, it’s their job to grow revenue and increase profits. Ask the same person what the goal of digital advertising is and they will tell you that they want more sales or sales leads either in-store or online. All of these equate to revenue.

Isn’t ROAS the goal of digital advertising?

No it is not. Make ROAS the goal and you will restrict growth opportunity.  ROAS (return on ad spend) and CPA (cost per acquisition) are both KPIs (key performance indicators). KPIs are a very useful way to determine how effective your digital advertising spend is tracking towards your revenue goal.

Targeting a higher ROAS or lower CPA can decrease revenue, margin and profit contribution

Let’s look at four simple examples of a website targeting ROAS and assume they make 50% margin on goods sold.  Each column increases the budget by $1,000 and decreases the ROAS. To keep things simple let’s ignore lifetime customer value.



First Scenario

Second Scenario

Third Scenario

Fourth Scenario





















Profit Contribution 










First Scenario: Acceptable.

This is where most advertisers feel most comfortable. Spend as little as possible and get the largest possible return. This is a very acceptable way to start and it is also understandable if you have capital restrictions.  However, traffic, sales and revenue are often restricted by the higher ROAS target. In order to achieve a higher ROAS in digital advertising you need to bid lower than your competition and this will limit the size of the audience you are able to reach.

Second Scenario: Good.

This can be a leap of faith for some advertisers but when they do accept that increasing budget and relaxing the ROAS target leads to more revenue, margin and profit contribution from advertising, they are well on their way to growth.

Third Scenario: Optimal.

This is when your digital ads are running at their peak. You are spending more, getting less ROAS but higher returns, margins and profit contribution. I have chosen to ignore lifetime customer value in the table above but if you included lifetime value you would probably relax the ROAS and increase the budget a little more.

Fourth Scenario: Diminishing.

It is possible to get to the point of diminishing returns. You can absolutely overpay and get the same returns that you would have for less. This scenario is double the ad spend of scenario 2 with a reduced ROAS, leaving you with a lower profit contribution.

This fear of diminishing returns is what leads to advertisers constantly pushing for a higher ROAS. A solution for advertisers is to gain a better understanding of their gross margin.

You can build a similar model as the table above for a CPA example which will tell you the same thing because the same rules apply. A lower budget and lower CPA means you bid lower, have less reach and ultimately sell to less customers.

How do I measure campaign efficiency if its not ROAS?

That is a very good question that deserves a very good answer. To answer this specifically I would need to unpack each digital campaign type separately.

If you are still reading I have convinced you that the higher budget and lower ROAS mathematically can drive more revenue, more margin and contribution to company profits.
But you rightfully want to know if it can be even better.

“Wouldn’t it be great to get increase my ad spend and increase my ROAS too” 

Yes indeed it would. 

All of the popular digital media platforms (Google, Facebook, Instagram, YouTube) have a measure of ad quality.  They don’t do this for the advertiser they do it for themselves.

All of the key media players obsess over user experience of their platforms. Google wants users to choose them to search and shop over Bing or Amazon and users won’t stay around if the ads are deemed to be annoying or irrelevant. The media platforms have also finally understood that if advertisers get good returns they will keep spending.

Increase ad quality metrics to decrease CPC and increase ROAS

Ad relevance, landing page experience and Quality Score are examples of ad quality metrics that the major digital platforms use to show advertisers the areas they need to improve on. In every case an increase in score of any of these quality metrics will reduce the amount you pay per click. 

At this point I have to remind you that the ad auctions of all the major digital platforms are all developed by engineers.  As one of my favorite Googlers once said, “If I had designed Google Ads instead of an engineer, there would have been more colors”. 
Let’s stick with Google for a second and take a look at their ad quality metrics to illustrate how increasing relevance reduces CPC. 

Quality Score: 

Quality score is measured at the keyword level. 10 is the highest and 1 is the lowest. To optimise quality score you would look at the Search Queries and set some as negative and move others to their own exact match ad group.

Ad Relevance and Landing Page Experience: 

Ad Relevance is represented in the interface as average, below average and above average. Improving your ad copy and its relationship to the targeted keyword will improve your ad relevance which will also increase your click through rate which increases your quality score and reduces your CPC.

Lost you yet? Once again, what the media platforms are trying to do is improve the user experience of ads on their platforms at a mind boggling scale. If your quality score is too low your ads won’t show at all, but if you increase it, you will be rewarded with a lower CPC which means you get even more sales for a reduced cost relative to your competition.

In summary, the goal of digital advertising is always revenue

  1. The goal is revenue
  2. ROAS is a KPI that shows you the effectiveness of your budget
  3. Higher budget with a lower ROAS can deliver more revenue
  4. Optimise ad relevance for campaign efficiency


Grow your revenue through digital advertising and Dynamic Creative

If you want to use Google ads to grow and scale your business and reach a point of predictable revenue then Dynamic Creative can help. We integrate your website with our Ad Platform & optimise your product and category data to match the way that shoppers search, browse and buy. You can get a Google Shopping feed, as well as Google Search & Shopping ads, for every product listed on your website. With over 17 years experience in Google Ads and over 400 websites globally, we have the ad platform and experience to help you grow and scale your business. Find out how you can get started with us here.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.


Use FeedOps to get products listed in Google for Free.

Share on facebook
Share on twitter
Share on linkedin

More Posts

Excellent Service, helped take our business to the next level, thanks Team Dynamic 😃😃
Martin Fleming
Martin Fleming
10. December, 2020.
I have been with Dynamic Creative for a while and have loved every single part of it. Clear communication, respond fast and great results. We used to be with another company and since partnering with Dynamic Creative, we doubled our return on investment. I would definitely recommend them. Ellie
Elien Degraeve
Elien Degraeve
9. December, 2020.
We have been working with CD since March – the move worked seamlessly and results are excellent with big sales growth. I work with an Account Manager when required and that has been a great support for making decisions on the Account. We are very pleased with our move to CD.
Manta Surf Co.
Manta Surf Co.
8. December, 2020.
Lucinda has been amazing to work with. She closely monitors the account, provides updates, and optimises where necessary to achieve our set goals. Communication is clear and fast. Would highly recommend working with her and Dynamic Creative!
Georgia Gwyn
Georgia Gwyn
7. December, 2020.
I have worked with Dynamic Creative for the past 9 months and they are a wonderful team to work with!! They have a clear understanding of our goals and have helped strategize, execute, and fine tune our campaigns in effort to reach them. Always professional, always responsive and always knowledgeable.
Olivia DiCapua
Olivia DiCapua
9. November, 2020.
Great service and friendly staff. Professional and reliable online markteting skills. Always helpful whenever there is a problem.
26. October, 2020.
I highly recommend Dynamic Creative. The team is results driven and is always happy to help. Tiff is very professional and great to work with.
Mathilde POLLIER
Mathilde POLLIER
8. October, 2020.
I have found Dynamic Creative to be very helpful and integral to our online business. They have helped us achieve amazing online sales and are now a must have investment for our business and we look forward to sharing a long and profitable relationship.
Evan Jones
Evan Jones
29. September, 2020.
Our company has been working with Dynamic Creative for many years across several markets. The team has always shown great initiative and action towards our goals. Clear communication, fast response and overall a pleasure to work with. Lucinda, as well as the team, is a great professional who puts real care and understanding into her work.
Kantar Profiles
Kantar Profiles
24. September, 2020.
As the Marketing Manager of two large retail brands, I have been a client of Dynamic Creative’s for three years. We initially started by trialling the smaller of our two brands with them, and based on the results transitioned the balance of our business from another provider across to DC. The tech that they use is smart, efficiently delivery traffic and returns (ROAS) well beyond our targets. We are a growing business, with changing needs, even more so right now (2020). As our needs change, DC has been nimble and worked with us to modify our advertising to take advantage of various opportunities. Communication with my account manager Tiff is excellent, as with access to the wider team (all very friendly and pleasant to work with). They are quick to respond to requests, address any concerns and provide advice on best practices, often going the extra mile to help me find creative solutions. We are delighted with what we have achieved together and happily continue our partnership. Recommended.
Luke Bowditch
Luke Bowditch
23. September, 2020.

Dynamic Creative advertising platform operates both RQmedia and FeedOps. 

Copyright 2021 © All rights reserved


Get the latest blogs and papers sent to your inbox


Download the ultimate guide to Google Shopping Ads