Key Formulas for Establishing a Paid Media Budget

In digital marketing, calculating a paid media budget requires precision, and knowing what to calculate and how to do it. Here's a quick guide to understanding the essential formulas that will allow you to optimise your investment.

🔍 Definitions to keep in mind:

📌 Average Order Value: Average amount a customer spends per transaction.

📌 Direct Costs: Costs directly linked to the production or delivery of the service/product.

📌 Lead Conversion Rate: Percentage of leads that convert into customers.

🧮 Essential Formulas

Target CPA:

Gross Profit per Order * Percentage of Profit Allocated to Paid Media.

CPL Target:

CPA Target * Lead Conversion Rate.

Monthly Budget:

CPA Target * Number of Customers Needed

ROAS for E-commerce:

Total Monthly Revenue / Monthly Budget

Use these metrics to set up and adjust your campaigns more effectively, based on actual performance and market conditions.

Remember: successful paid media management starts with a well-thought-out budget.

Optimization of Social Media Advertising Campaigns: A Data-Driven Approach

Tracking social ads campaigns is an indispensable part of achieving the desired goals. A systematized methodology is one of the best ways I know to tackle tasks of this type.

The essence of this process lies in one word: adaptability. Weekly, it's crucial to review your highest-cost A/B tests in each ad group, comparing the CTR, conversion metrics, and costs among active ads. If an ad isn't performing as well as you hoped, pause the underperforming ad and concentrate the budget on those with better results; this is the first step to fine-tune your strategy. However, what if the data are inconclusive? Allow the test to continue for another week, as it may provide clearer data.

Monthly and quarterly tracking is also vital. Review elements such as the offer, creative/copy, and targeting, and identify possible areas for improvement and adjust your strategy to achieve a positive performance trend. If you identify audiences that are not converting despite high spending over a considerable period, reconsider and possibly stop advertising to those audiences.

Incorporating conversion analysis and page tracking in Google Analytics can offer a deeper understanding of how users interact with your site after clicking on an ad.

Every aspect of your campaign, from creativity to the landing page, must be carefully considered and optimized based on reliable data. And what does this mean for you? It means more effective campaigns, better use of the budget, and, most importantly, a higher return on investment.

La fórmula para anuncios que funcionan en redes sociales

Did you know why some ads on Facebook and Instagram stand out more than others? 🤔 Here’s a revelation about the order in which most people interact with ads in their feeds:

1. Ad Creativity: It’s the first thing that captures attention. An image conveys more information than a thousand words.

2. Headline: Acts as a bridge, contextualizing the ad’s creativity.

3. Primary Text: Provides the necessary context, digging into the details.

And, how should we really systematize the process behind our ads to ensure that each element works harmoniously and achieves the desired impact? 🛠️ This would be the approach I like to use:

1. Headline: Start with a clear description of the offer. Make your audience want to know more.

2. Primary Text: Provides more context and information.

3. Ad Creativity: Ends with a visual punch that captures and retains attention, sealing the message of your ad.

This inverted strategy emphasizes the importance of having a clear and direct message from the beginning, guiding the visual creativity to complement and reinforce that message, not the other way around. ✍️