Want to know how to grow your business year-round, even when things are slow? Learn from Regina's success story! These tips and advice could be the missing puzzle to your success.

Regina Bellows, Executive Director of StarterPPC, outlines how they increased one client's profits by 13% during their off-season. She shares her story of success and gives actionable tips on how to use analytics and metrics to get smarter with your marketing decisions. With this valuable advice, you can also make your business thrive even when things seem slow.

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0:00 How To Achieve Profit Increase Despite The Off-Season

1:59 Analyzing ROAS and MER

4:27 The challenge of a small business

7:23 Need help scaling Google Ads with a limited budget? Let StarterPPC help you!

9:03 Increasing the ad budget little by little

13:32 Future predictions for MER

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#googleads #digitalmarketing #googleadsbestpractices #ppc

Hey everyone, Regina here with Starter PPC.

2

I'm going to talk today

about a success story.

3

We have a client who's been with

us for almost 11 months now.

4

and most recently we were able

to make some breakthroughs.

5

We were able to increase

the business's profit.

6

Okay.

7

Not just revenue, but

like bottom line pocket.

8

cash in pocket profit, by 13%.

9

It was actually closer to 13 and a half

percent, on average over the past three

10

months in the middle of the off season.

11

I think this is a big deal because usually

in the off season profit goes down.

12

I want to show you guys the numbers.

13

So we're going to look at some

spreadsheets that I have, and I'm

14

going to show you how we did it.

15

But before I dive into that, I

want to talk through some of the

16

history just to give you context.

17

So this client has been with us

for about 10 and a half months.

18

I believe she started in November

of last year, but I'm just showing

19

January, we were spending only

about $500 in budget every month.

20

Now normally we work with

clients who have budgets between

21

1000 and to 5,000, dollars.

22

but if a client comes in with $500

in budget, we will work with that.

23

It's just that it's very difficult

to make a profit with $500 in

24

budget I'm going to show you why.

25

the return on ad spend was really high.

26

This is a seasonal business that

does really well in the winter and

27

the business dies off in the summer.

28

she actually sells

felting supplies, right?

29

crafting, making scarves, things

like that, which people do

30

in the fall and in the winter.

31

the blue line is ROAS and

it was really high 17, X.

32

And this is just return

on ad spend, you guys.

33

So as you can imagine, if the return

on ad spend was only 1, 700%, then

34

the overall business's return on media

spend, right, media efficiency ratio,

35

which is an even more accurate number

to look at is almost always higher.

36

And sure enough, it was higher.

37

For those of you who are lost,

the difference between ROAS, which

38

is return on ad spend and media

efficiency ratio is just that ROAS

39

relies on the Google tracking, which

is inaccurate to come up with a return

40

on how much ad spend happened, right?

41

So it only counts people

that can be tracked after

42

they've interacted with an ad.

43

Whereas media efficiency ratio is like

calculating ROAS, but on a business level.

44

So you would basically take

your total revenue, and divide

45

it by your total, media spend.

46

it's always higher than ROAS.

47

Almost always, unless

something is very wrong.

48

Alright, so we were spending about 500.

49

We were making super high returns.

50

even in February when the blue

line starts to trend down, we are

51

only, again, making a ROAS of 8.

52

65.

53

The MER was higher.

54

and we're still spending about 500.

55

Then it goes a little

bit back up in March.

56

It goes, starts to go

down in April, right?

57

The ROAS is taking a dive in May.

58

People are not felting anymore.

59

and then in June, which was the lowest

month, the return was only 300%.

60

Now Throughout this entire time period,

every month we're going to the client.

61

We're saying, Hey, let's add budget.

62

Let's grow this business.

63

It's making really high returns.

64

Let's jump on this and get you more sales.

65

And she's saying to us, I can

barely pay my overhead costs.

66

I can't pay my bills.

67

And we're saying, wow, on your business,

you're making like a 20 X return.

68

So for every 1, she was making 20

and you still can't pay your bills.

69

That's because you don't have enough

profit left over after paying your

70

cost of goods and your shipping

costs, to cover the overhead and

71

still have some leftover, right?

72

So this is the problem with

being a small business.

73

We'll get back to this graph in a minute.

74

I want to show you guys the real

numbers in this spreadsheet.

75

This is the problem with

being a small business.

76

look at scenario one on the left side.

77

Here, everything in gray,

these are real numbers because

78

these have already happened.

79

All right?

80

So we were spending 500 in,

Google ads, but she was spending

81

more money in like Etsy ads.

82

she was hovering around 1, 000 spend

for the total business throughout

83

those months that we looked at.

84

And here is the media

efficiency ratio, right?

85

So not just ROAS and Google, but

this is the total businesses return.

86

So for every dollar.

87

She spent she was making 28 and Her

sales were only 25, 000 in revenue.

88

So when you take away the profit margin,

which is 25 percent right for cost of

89

goods and fulfillment Then she only

has five thousand four hundred dollars

90

with which to pay her overhead costs

And pocket some profit because she only

91

has a few months where the Mer is high.

92

It starts dropping in June, right?

93

So in June, she only made 2, 300

in profit, which might not even

94

be enough to cover her overhead.

95

So in the winter, she might still be

paying the bills from last summer.

96

problem.

97

And we were going to her

saying, hey, let's grow.

98

She finally agreed to start growing

her budget and growing her sales.

99

And you can start seeing that in July.

100

So July, August, and September are the

win months that I want to talk to you

101

guys about because in these months we

began to grow the Google Ads spend.

102

right here on the right.

103

I added some notes and you

can see budget change percent.

104

This is overall budget

for the business, right?

105

So in July, there was only

a 13 percent increase.

106

I don't think she was increasing

her budget other platforms.

107

So it was just our increase in Google

ads, which I think was slightly

108

less than 20 percent increase.

109

so we added 13 percent budget and,

we, it wasn't a huge increase.

110

Then you can see a 23 percent increase,

to the budget in August and a 10 percent

111

increase to the budget in September.

112

Now, what happened to the profit?

113

It's going up.

114

And this is in the dead of summer.

115

This is when nobody is felting.

116

It is hot.

117

Everyone is at the beach.

118

and I have tracked here the profit.

119

So as you can see, profit was just

going down for no reason other

120

than the fact that it was spring.

121

Hi there.

122

Quick interruption.

123

Do you know the main thing that

prevents small business owners from

124

getting their Google Ads account

into a position to grow and scale?

125

Budget.

126

A lot of businesses, especially

those that are just starting

127

out, have limited budgets.

128

And so because of this, they're turned

away by most ad agencies because most ad

129

agencies have minimum budget thresholds

that they're willing to work with.

130

So what happens is the business owners

end up learning Google ads themselves.

131

And the problem with that is

that most of the advice online is

132

geared towards larger accounts.

133

And the advice doesn't have any of those

strategies or tricks that can kickstart

134

the algorithm into giving a small

account a leg up over larger competitors.

135

So it often just doesn't work.

136

And the business just ends up

losing money month over month.

137

If this sounds familiar

starter PPC can help.

138

We offer Google ads management services

that are designed for accounts that

139

have between 1000 and 5, 000 budgets.

140

Because all of our clients are just

starting out, we've come up with

141

ways to keep our management fees

significantly lower than most agencies.

142

Because we know that every dollar saved

on management fees just goes towards

143

the ad budget, which is going to help

the algorithm gather speed and power.

144

So if you're serious about growing your

business and you'd like a team of Google

145

ads experts to help you without breaking

the bank, check us out at starterpbc.

146

com.

147

Okay.

148

Back to the video.

149

and then when we started adding

budget profit goes up, right?

150

13 percent increase.

151

In July from June, 20 percent

increase in August compared

152

with July, 7 percent increase in

September compared with August.

153

I think this is huge.

154

This averages out to a 13.

155

4 percent increase over the

last three months in profit.

156

and all we did was add budget.

157

I'm telling you, if you find

that you're not making enough

158

profit to pay your bills.

159

But your Mer is really high or

your row eyes is really high.

160

Just add a little bit of profit.

161

Don't add a ton all at once, right?

162

don't double your budget overnight.

163

Don't do more than 20 percent at a time.

164

if you're feeling very budget

strapped and you can't come up

165

with the 10, 20%, come up with 10%.

166

But try to come up with that budget

that you can add when the Mer is high.

167

Because It's the only way to crawl

out of that pit of, Oh, I don't

168

have enough profit to pay my bills.

169

I only have 2, 000.

170

To pay my overhead costs, So

now we're crawling out of it.

171

And this is in the off season.

172

So the reason why I have this spreadsheet

is because I'm trying to run some

173

scenarios, to try to figure out what's

going to happen as she sticks with us.

174

And we continue to do these

20 percent budget bumps here.

175

I'm adding a full 20 percent to

the business's budget overall.

176

month over month.

177

Now, I don't have any control over

the budget on the other platforms.

178

We only manage her Google ads account.

179

So I don't know if she'll actually do

20%, but this is my pie in the sky.

180

I want her to do 20%.

181

So on this scenario too, you

see the budget increasing by 20

182

percent and the scenario one,

it's staying the same, right?

183

We stopped doing increases

184

And over here, I'm using

some sort of average Mer.

185

I can't remember how I came up with this.

186

you don't really know what

the MER is going to be.

187

but you do know that if you don't increase

your budget, the MER will be higher

188

than if you do increase your budget.

189

Why?

190

Because every time you give the algorithm

more money to work with, It has to go out.

191

It has to find new people, new placements,

new combinations of ad copy, new images,

192

to use, new products to show, whatever

it is, and it has to try things, and

193

it has to figure out what's working.

194

You're also competing with

bigger competition, As you grow.

195

So your bigger competitors who are

able to bid more aggressively, you are

196

now playing in that pool with them.

197

So that's why the MER tends to

shrink as you grow your budget.

198

until it levels out at

an industry average MER.

199

The thing is a lower MER is

not necessarily a bad thing.

200

Why?

201

Because bottom line is profit, right?

202

So here, we were growing.

203

The budget, the mirror was shrinking

204

in August compared with July again,

205

yet profit was higher in September.

206

So don't be afraid of a shrinking mirror.

207

Be afraid of a shrinking mirror

that shrinks really fast,

208

profit is the bottom line.

209

if you're not making more profit,

then you're growing too quickly.

210

and since this is seasonal, we have

to look at every month individually,

211

what I would like to start doing

is comparing year over year, how is

212

July this year compared to last, but

I don't have that data right now.

213

so anyways, I'm running some

scenarios into the future.

214

I have no idea what the Mer

is actually going to be.

215

I suspect it's going to continue

shrinking as we grow because I don't

216

believe that her competitors are.

217

Able to make this high of a mer, right?

218

And whatever your competitors

are making is what your mer is

219

going to level out at as you grow.

220

So I'm going to assume it keeps shrinking.

221

I put some in January is

222

And this is a full whopping 1000

percent less than last January.

223

And yet sales revenue is 54, 000 compared

with last January, which is 25, 000.

224

Why?

225

Just because we have more budget.

226

We're spending three times as much.

227

even though the Mur is a thousand

percent less, revenue is super high and.

228

She has double the profit now, right?

229

10, 000 instead of 5, 000, so don't

be afraid of growth, you guys.

230

sometimes is the way out of your

financial woes, is to add budget.

231

yeah.

232

And this is just the total,

comparing two scenarios here.

233

71, 000 compared to 89, 000.

234

I have no idea how accurate this is.

235

I feel like this is a

really high MRSA, actually.

236

This should be probably lower.

237

Who knows if it's going to go back up

238

Definitely not in October.

239

I should probably set

this to 16, who knows?

240

yeah, let me go back to the graph and we

can just look at how things are panning

241

out, from inside the Google dashboard.

242

the red line, which is cost begins

to grow, in July, $600 spent.

243

the blue line is still low because

it's the middle of the summer.

244

$723 spent.

245

Blue line is still low 'cause it's the

middle of the summer, . And again, 864%

246

Blue line is still even lower because

it's still the middle of the summer.

247

September is the beginning of fall,

so hopefully it starts to grow.

248

The return starts to grow soon, but.

249

In September, return did not

grow and yet we still made more

250

profit than we did in August.

251

I can't stress this enough, you guys.

252

Don't be afraid of a shrinking MER.

253

Be afraid of a shrinking profit.

254

Okay, thanks for watching.

255

This is a success story.

256

If you are interested in growing your

account with Google Ads, check us out.

257

We are Starter PPC.

258

We manage budgets between

1, 000 and 5, 000.

259

500 and 5, 000.

260

and we would love to work with you.

261

Thanks for watching.