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Mastering Key Business Metrics to Boost Revenue
3rd July 2024 β€’ The Google Ads Podcast β€’ Solutions 8
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Joshua Rugg, one of our amazing account managers, shares the business metrics you should pay attention to to boost your revenue. He represents this through a chicken laying golden eggs, the chicken representing your business, and the eggs symbolizing revenue. He emphasizes the importance of a more holistic approach to what and how to feed your chicken so it lays more golden eggs. Listen to this episode to learn more.

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Transcripts

Joshua:

I've never heard a business say, I don't want any more money.

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the higher, this is the bigger, this,

the more money you're going to get.

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So how do we get that or those

eggs, a lot bigger or more often?

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we take a look at the chicken.

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Hey, how's it going everyone?

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This is Josh with

another Google ads video.

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And today we're gonna be

talking about a chicken.

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But not just any chicken, this chicken

is very business and puts his business

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head on and gets to work at trying

to make as much money as possible.

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But with all jokes aside, this is

a, metaphor, for business metrics.

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You have your blended numbers slash

backend for the chicken itself.

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Then you have the in app numbers, which

could be meta Amazon or Google ads

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platform, what you see inside there.

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That's the in app numbers here.

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Then you have the golden standard

of revenue, that golden egg.

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I've never had a farmer say,

Hey, I got too many eggs, or

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I got, too many large eggs.

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I've never heard a business say,

I don't want any more money.

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the higher this is, the bigger this

the more money you're gonna get.

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So how do we get that or those eggs?

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a lot bigger or more often.

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we take a look at the chicken.

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And basically how business started

out is you start feeding the chicken.

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New customers goes into new

orders, goes in, new cost required.

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New customer goes in a

burr, AOV, total orders.

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Then you start getting into kind of

repeat customer rates, open email

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rate, customer lists, and LTV.

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these are all interconnected

to each other.

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They all share the same blood of,

All the stuff that's digested kind

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of spreads across the chicken.

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And if you take one of these

away, let's say opening, right?

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You don't know what's going on there.

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maybe it's really poor and you can be

missing out on making this egg slightly

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bigger than, it could have been.

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And same goes with me or

nac, we take away nac.

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Then how much are you spinning

on a new client to come in

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or a new customer to come in?

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Which could affect

overall numbers as well.

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It starts to dwin it down

into all these other areas.

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'cause it could be the heart

line or the heart of the chicken.

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And if it's not pumping out, enough

blood to all these other horses.

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I could start taking a dive, that's

how the revenue or the golden standard

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works is the health of the chicken.

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Let's take these in app numbers.

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And I consider these like

the droppings of, numbers.

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Like you have CPA clicks,

CPC rows, conversion rate.

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So it's not saying that

these numbers are bad.

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you could definitely use these

numbers for trends and saying, okay,

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like our rows dropped by a lot.

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What happened there?

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did we make any changes?

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but we want to make sure that we're

not using these as a standard for

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any one platform in particular.

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let's take, for instance,

let's do some tests here.

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We have Meta Amazon Google and

think of these as food sources

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for this chicken right here.

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let's say we want to scale up Meta,

it's getting really good ROAS.

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So let's throw ROAS on there.

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this is the formula for basically

ROAS, we scaled it up and

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we got some unknowns there.

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we know that we are getting some new

customers, but if we just take a look at

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ROAS, it could be a lot of remarketing.

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It could be a lot of repeat customers

that's scooping up and we're feeding

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that chicken that type of, mix.

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are we looking at the backend?

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Are we taking a look at new

orders or new costs required?

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Customer, might drop, if we're

just looking at ROAS because

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it's so heavily in marketing and

then LTV might jump up slightly.

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but in the long run, if this is not

being fed, then it's going to start

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going and messing with everything else.

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And then your revenue is going to

start dying off, and the eggs are

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going to get smaller and smaller.

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we don't want to do that, but the

good thing about that is we did an

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isolated test with that just now.

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We know that if we scaled up meta,

So let's say, okay, we know that,

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maybe Google ads pushing a lot

of cold traffic, cause we have

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a lot of good terms in there.

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We're using some shopping campaign

and whatnot to just push cold

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alone, but it doesn't look like it's

getting a lot of roads, but we want

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to go ahead and test and see if we

scale it up or if we make a change.

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what will it affect the chicken versus

just looking at these, droppings here

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and saying, that's it, that's, that

CPA, that row is decreased by a lot.

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We don't want to do that.

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We want to feed the chicken, let

it go through its process and say,

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okay, is INCAC up, the new orders

come in, is the MRR stabilized?

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and then you can start looking at LTV.

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Sometimes how did that

change when we did this?

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more of an isolated test of that.

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But if we start going and saying,

okay, we're going to increase

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Google ads at the same time, we're

going to throw an Amazon ads.

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We're going to chop that.

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And then we're going to

increase, meta ads as well.

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now you have all of this type of

food source going into the chicken.

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And all these numbers start changing.

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if revenue goes up, okay.

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what actually affected the chicken?

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Was it the Amazon blend?

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was it Google then was it both of them

or if it dropped, what made it worse?

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Was it Meta?

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Was it Google?

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So you really want to focus on

isolated tasks and not just throw in

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a bunch of things because we can make

changes and say, Hey, maybe we're

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impressed on a certain type of outcome.

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We need this right away.

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it's more of the long game of saying,

Hey, we need to really make sure that

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these that chicken's being fed properly.

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And saying, okay, that revenue is coming

out, solid gold versus like this murky

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stuff right here where it says, okay,

click CPA, CPC went down or up, versus

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what's actually going on in the back end.

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So that's my little spiel, on the chicken

strategy, but, I'll probably start diving

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into these a little bit more in depth.

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I know this is like a general video

of kind of how things are set up.

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And the, process of making sure

that we do isolated tests to make

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sure that these numbers are nice and

healthy to get that revenue going.

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so that, yeah, that's what I got.

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Have a good one.

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