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Use this framework to maximize ROAS, reduce wasted spend, and scale your ads profitably!

  • What's a good ROAS?

    • Ecommerce: 3x-5x+ is strong (Break even = 1)

    • Lead Generation: Depends on LTV and CAC (often 2x-3x)

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    Troubleshooting a low ROAS:

    • Check Conversion Rate (Step 2) and CAC (Step 10)

    • Look at CTR & Creative Performance (Step 3)

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    Understanding the Factors that Impact ROAS


    ROAS is not a standalone metric - it's the result of multiple moving parts within your ad funnel. If your ROAS is underperforming, you need to break it down into key factors that contribute to it:

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    1. Conversion Rate (CVR): If users click but don't buy, your landing page, offer, or checkout flow may need optimization. 
       

    2. Click Through Rate (CTR): If people aren't clicking, your ad creative, messaging, or targeting might not be resonating. 
       

    3. Average Order Value (AOV): If you're getting conversions but still struggling with ROAS, look at ways to increase cart value through upsells, or higher ticket offers. 

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    Check Your Primary KPI - Typically ROAS (Return on Ad Spend)

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    Analyze Your Conversion Rate (CVR)

    What's a good CVR?

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    • 3-5% is okay, but 7-10% is ideal

    • If below 3%, your landing page or offer needs work

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    Why CVR Matters

    Your conversion rate is a critical driver of ROAS - if people are clicking in your ad but not converting, you're paying for traffic that isn't turning into revenue. Before you increase ad spend, you to need to fix CVR first. 
     

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    If CVR is low, troubleshoot these areas:

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         1. Landing Page Experience:

    • Is the offer clear and compelling?​​

    • Are you removing friction (fewer steps = better CVR)?

    • Does the page load in under 3 seconds?

    • Is it mobile optimized? (80% of users are on mobile)

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         2.  Offer Strength & Urgency

    • Are you using limited time urgency? ("Only 24 hours left!")

    • Is your call to action (CTA) strong and clear?

    • Is your discount/incentive competitive?

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         3. Ad & Page Alignment (Message Match)

    • Does the ad copy match the landing page headline?

    • Are users seeing exactly what they expect when they click?

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    Optimizing CVR should always come BEFORE increasing ad spend - otherwise, you're just wasting money on traffic that won't convert.

  • Review Your Ad Creative Performance - Click Through Rate (CTR)

    What's a good CTR?

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    • Prospecting - 2%+

    • Retargeting - 4%+

    • If CTR is low, your ad isn't capturing enough attention

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    Why Ad Creative is Key

    Your ad creative is the first impressions - if people aren't clicking, they're not even entering your sales funnel. CTR is the leading indicator of whether your messaging, visuals, and targeting are effective. 
     

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    If CTR is low, troubleshoot these areas:

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         1. Ad Format & Creative Type:

    • Short form video (5-15 sec) > Static images (Video =30% higher engagement)

    • Carousel Ads - Great for storytelling or showcasing multiple products

    • UGC Style Ads - Native, organic looking ads perform best on Meta and TikTok

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         2.  Scroll Stopping Visuals

    • Use bright, high contrast colors to stand out

    • Avoid too much text - let the image/video do the work

    • Test bold headlines in the image ("50% Off - Today Only!")

    • Faces and motion get higher engagement - use eye catching elements

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         3. Ad Copy Hooks & Messaging

    • First 3 seconds = make or break - Strong hook is key

    • Address a problem & solution immediately

    • Use social proof - Testimonials, stats, or credibility markers

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    Your ad creative is your first battle - if you lose here, everything else in your funnel suffers. 

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  • Check Your Audience Performance

    What to look at:
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    • CTR by Audience

      • Prospecting - 2%+​

      • Retargeting - 4%+

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    • Conversion Rate by Audience

      • If CTR is high but CVR is low - Wrong audience or weak offer​

      • If CTR is low - Poor targeting or weak ad creative

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    • ROAS by Audience

      • Which audience segments are driving the highest return?​

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    Why Audience Targeting Matters

    Even the best creative and landing pages won't work if you're targeting the wrong audience. You need to analyze how different audience segments perform to shift budget into what's working and cut what's not. 
     

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    If your results aren't where you want them, troubleshoot:

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         1. Are you running both Prospecting and Retargeting?

    • Prospecting (Cold Audiences) - Finding new customers

    • Retargeting (Warm Audiences) - Bringing back interested buyers

    • If you're only running prospecting ads, your CAC will be higher

    • If you only run retargeting ads, you'll eventually exhaust your audience

    • Solution: Always run both

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         2.  Are your audiences too broad or too narrow?

    • Too Broad - Wasting money on unqualified users

    • Too Narrow - Not enough reach for scale

    • Test & Compare

      • Advantage+ Audiences - AI powered broad targeting​

      • Interest Based Audiences - Manually selected based on intent

      • Lookalike Audiences - Modeled after best customers

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         3. Retargeting - Are you covering the full funnel?

    • All website visitors (exclude buyers)

    • Abandoned cart users (high intent)

    • Repeat customers (upsells)

    • Engaged social media users (people who watched 75% of a video)

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    Your audience determines everything - test, analyze, and optimize for maximum ROI.

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  • Are You Running Retargeting Campaigns?

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    • Retargeting = lower Cost to Acquire a Customer (CAC)

    • Prospecting is expensive, but retargeting converts better

    • Most users won't buy the first time - this is how you bring them back!

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    Why Retargeting is Essential

    80% of conversions happen after multiple touchpoints - if you're only running prospecting ads, you're leaving money on the table.

    • Retargeting ads convert 70% more users than prospecting

    • Lower Cost Per Lead (CPL) & higher ROAS

    • Builds trust and keeps your brand top of mind

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    If your results aren't where you want them, troubleshoot:

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         1. Key Retargeting Audiences You Should Be Using

    • Website Visitors (Last 30-90 Days) - People who browsed but didn't buy

    • Cart Abandoners - High intent users who didn't complete checkout

    • Engaged Social Media Users - People who watched 75% of your video

    • Past Purchasers - Upsell or cross sell products/services

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         2.  Retargeting Ad Strategies That Work

    • Personalized Offers:

      • Example: "Still thinking about it? Here's 10% Off - Today Only!"​

      • Show the exact product they viewed (dynamic retargeting)

    • Video Testimonials & Social Proof​

      • Show real customers talking about how your product helped them​

      • "Don't take our word for it - see what others are saying!"

    • Urgency & Scarcity​

      • "Your cart is about to expire!"​

      • "Only 3 left in stock!"

    • Cross Selling & Upselling​

      • "Complete your set with this matching product"​

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         3. Retargeting Funnel Example

    • Day 1-3: Reminder ad (same product, social proof)

      • "Forgot something? Here's your cart."​

    • Day4-7: Discount or urgency offer

      • "Stilll thinking about it? Here's 10% Off"​

    • Day 8-14: Different angle (testimonial or UGC)

      • "See why 10,000+ people love this product"​

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    If you're not running retargeting, you're losing easy sales - fix this now! 

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  • Are You Using Lookalike Audiences?

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    • Lookalike audiences - AI powered targeting

    • Meta & Google use your best customers to find more like them

    • Higher ROAS + lower CPA when used correctly

    ​

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    Why Lookalike Audiences Matter

    Lookalike audiences leverage AI to find new high converting customers based on your existing data. Instead of guessing interests, you can let the platform automatically identify similar buyers.

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    • Higher conversion rates than cold prospecting

    • Lower Cost Per Acquisition (CPA) vs interest based targeting

    • Best for scaling beyond your existing audience

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    If you're not using lookalikes, you're missing an easy way to scale profitably.

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         1. Best Lookalike Audiences to Test

    • 1% Lookalike of Past Purchasers - High intent, similar to best customers

    • 1-3% Lookalike of Cart Abandoners - People who almost bought

    • 1-3% Lookalike of Website Visitors - Broad audience with interest

    • 1% Lookalike of High Value Customers (LTV) - Find big spenders

    • 1% Lookalike of Engaged Social Media Users - Fans likely to convert

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         2.  How to Use Lookalikes in Your Funnel

    • Cold Prospecting:

      • Use lookalike audiences instead of broad interest targeting

      • Combing lookalikes + broad targeting for best results

    • Retargeting Expansion

      • Create a lookalike of engaged users - video viewers, page visits

      • This finds more warm leads in your funnel

    • Scale Winning Audiences​

      • If 1% lookalike is profitable, test 2%, 3%, or even 5%

      • Don't be afraid to increase audience size as your budget grows

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         3. Pro Tip: Combine Lookalikes with Dynamic Creative

    • Lookalike audiences work best with multiple ad creative options

    • Use Dynamic Creative for multiple headlines images, and videos

    • Meta & Google will automatically match the best ad to the right users

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    Lookalike audiences are a game changer - use them to scale efficiently!

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  • Is Your Ad Messaging Tailored to Each Audience?

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    • One size fits all messaging doesn't work

    • Different audiences need different ad copy

    • Match your message to where they are in the customer journey

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    Why Ad Messaging Matters

    Your ad copy should speak directly to the audience's awareness level. A first time viewer needs different messaging than someone who's already visited your site.

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    • More relevant messaging = Higher CTR & CVR

    • Higher engagement = Lower CPC & CAC

    • Better alignment = More saales

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    If your messaging isn't tailored, you're wasting ad spend on the wrong people.

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         1. How to Structure Your Ad Messaging by Audience

    • Prospecting (Cold Audience - Never Heard of You Before)

      • Hook: "Struggling with [pain point]?​

      • Explain how your product/service solves their problem

      • Focus on credibility: social proof, stats, or awards

      • CTA: "Shop Now" or "Sign Up"

    • Retargeting (Warm Audience - Shown Interest But Didn't Convert)​

      • Hook: "Still thinking about [product]?​

      • Remind them what they viewed

      • Introduce urgency, scarcity, or a special offer

      • CTA: "Claim Your Offer" or "Finish Your Purchase"

    • Loyal Customers (Existing Buyers - Repeat & Upsell)​

      • Hook: "Thank you for your purchase! Here's something special just for you"​

      • Cross sell or upsell related products

      • Offer VIP perks, loyalty rewards, or buddle discounts

      • CTA: "Shop Again & Save" or "Exclusive Deal Inside"

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         2.  Call Out Your Audience in the First Line

    • Why?

      • Instantly grabs attention​

      • Filters the right audience

      • Higher engagement and relevance

    • Examples:​

      • "Ecommerce store owners, this is for you!"​

      • "Freelancers, stop overpaying for ads!"

      • "Dog owners, you'll love this...."

      • "[Your County/City] Area Moms!"

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         3. Match Your Offer to Audience Type

    • Cold Traffic (Prospecting Ad)

      • Hook: "Most small businesses waste 50% of their ad spend - don't be one of them."​

      • CTA: "Download the Free Checklist"

    • Warm Traffic (Retargeting Ad)​

      • Hook: "Your free ad audit is waiting - schedule now before spots fill up"​

      • CTA: "Book Your Free 15 Min Call"

    • Hot Traffic (Customer Re-Engagement Ad)​

      • Hook: "Thanks for trusting us! Here's 20% off your next service"​

      • CTA: "Claim Your Exclusive Discount"

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    If you're not speaking directly to the right audience, your ads won't convert - fix this now!

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  • Are You Using a Strong Call to Action (CTA)?

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    • A weak CTA = Lost conversions

    • Your audience needs clear next steps

    • The right CTA can increase conversions by 30%+

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    Why Your CTA Matters

    Your ad should guide the user to take action. If your CTA is vague, they'll keep scrolling. The Best CTAs make it obvious what to do next.

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    • Clear direction = Higher click through rates (CTR)

    • Strong intent = More conversions

    • Reduces confusions and friction

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    If your CTA is weak, you're leaving money on the table.

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         1. What Makes a CTA Strong?

    • Action Oriented - Tells them exactly what to do

    • Urgency - Encourages action NOW

    • Benefit Driven - Reminds them why they should act

    • Short & Simple - No more than 4-5 words

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         2.  CTA Examples Based on Goal

    • Lead Generation

      • Download Your Free Guide

      • Book Your Free Call

      • Get Instant Access

    • Ecommerce Sales

      • Show Now & Save

      • Claim Your Exclusive Discount

      • Grab Yours Before It's Gone

    • Course Sign Ups​

      • Join Today & Start Learning​

      • Enroll Now - Limited Spots

      • Master Ads in 30 Days

    • Service Based Business​

      • Schedule Your Free Strategy Call​

      • See How We Can Help

      • Request Your Free Audit

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         3. How to Strengthen Your CTA with Urgency

    • Time Sensitive Offers

      • Limited Time Only

      • Offer Ends Soon

      • Only 3 Spots Left

    • Scarcity & Exclusivity

      • Join 1 of Only 10 Beta Seats

      • First 50 People Get This Free

    • Incentives & Social Proof

      • Thousands Have Already Joined

      • Claim Your Discount Before It's Gone

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    A strong CTA can double your conversions - optimize yours now!

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  • Is Your Offer Compelling Enough?

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    • A weak offer = No action taken

    • Your offer must be irresistible

    • The right offer can 10x conversion rates

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    Why Your Offer Matters

    No matter how good your targeting, creative, or CTA is - if your offer doesn't excite your audience, they won't convert. A strong offer is clear, valuable, and risk free.

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    • High perceived value = More conversions

    • Solves a real pain point

    • Feels like a no brainer to accept

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    If your offer isn't compelling, you're losing customers to competitors.

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         1. What Makes a Strong Offer?

    • Value - It must solve a problem or provide transformation

    • Urgency - It should feel time sensitive

    • Low Risk - It should minimize hesitation (free trial, money back guarantee, etc)

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         2.  Offer Types That Convert

    • Lead Magnets

      • Get 10% Off Your First Order - Sign Up Now

      • Download our Free Holiday Gift Guide for the Best Deals

      • Claim Your Free 15 Minute Strategy Call

      • Get a Free Website Audit - See What's Missing

    • Low Ticket Offers (Entry Point for Paid Customers)

      • Try Before You Buy - Free Sample with Your First Order

      • Limited Edition Bundle for $27 - Only 100 Available

      • $7 Ad Optimization Guide - Fix Your Ads Today

      • First Consultation $1 - Get Your Custom Plan

    • High Value Paid Offers (Main Revenue Driver)

      • VIP Membership - Early Access + Exclusive Discounts

      • Buy 2, Get 1 Free - For a Limited Time

      • Full Ad Management - Let Us Scale Your Business

      • Done for You Campaign Setup - Start Generating Leads Now

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         3. How to Make Your Offer Stand Out

    • Stack the Value

      • Order today and get a FREE bonus item + express shipping

      • VIP Customers get access to our private Black Friday sale

      • Join our program and get 3 extra weeks FREE

      • Sign up for our service and receive a $200 credit

    • Add a Guarantee

      • 100% Money Back Guarantee - Love It or Return It

      • Lifetime Warranty on All Orders - We Stand by Our Products

      • ROI Guaranteed - If You Don't See Results, You Don't Pay

      • We'll Get You 10+ Qualified Leads or Your Money Back

    • Limited Availability

      • First 50 Orders Get an Exclusive Bonus Gift

      • Limited Stock - Once It's Gone, It's Gone

      • Only 3 Free Audits Left This Week - Book Now

      • Our Next Enrollment Closes in 48 Hours

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    Your offer should make your audience think, "I'd be crazy to pass this up!"

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  • Do You Know Your Customer Acquisition Cost (CAC)?

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    • If you don't know your CAC, you don't know your profit margins

    • Understanding CAC = Smarting scaling decisions

    • A low CAC means more profit per customer

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    Why CAC Matters

    Customer Acquisition Cost (CAC) is how much you spend to acquire a new customer.

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    • Know if your ads are profitable

    • Determine how much you can spend to scale

    • Ensure long term business sustainability

    • Formula:

      • Spend ÷ New Customers

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         1. What's a good CAC?

    • Depends on your industry and product pricing

      • Ecommerce - Typically aims for CAC lower than 30% of AOV (Average Order Value)​

      • Local Service Businesses - CAC should be sustainable based on lifetime value (LTV)

      • Digital Products - CAC should be low relative to high margin offers

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         2.  How to Reduce CAC & Increase Profitability

    • Improve Conversion Rate (CVR)

      • Optimize landing pages for a 7-10% conversion rate

      • Simplify the checkout process for ecommerce stores

      • Ensure high quality product/service pages

    • Increase Average Order Value (AOV)

      • Offer bundles, upsells, and cross sales

      • Add free shipping thresholds to encourage bigger orders

      • Use loyalty programs to increase repeat purchases

    • Optimize Ad Targeting

      • Use retargeting to re-engage potential customers

      • Leverage lookalike audiences for best customers

      • Test different ad creatives and messaging

    • Enhanced Lead Nurturing​

      • Follow up with email sequences for abandoned carts​

      • Use SMS marketing for fast conversions

      • Add chatbots for instant responses

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    Lower your CAC, increase your profits, and scale with confidence!

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  • Are You Scaling the Right Campaigns?

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    • Scaling the wrong campaign = wasted budget

    • Double down on what's actually working

    • Identify the best performing audiences, creatives, and offers

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    Why Scaling Matters

    Scaling ads shouldn't just mean increasing your budget. You need to know where to put more money to maximize profit.

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    • Increase ad spend efficiently

    • Identify winning audiences & creatives

    • Avoid wasting money on low performing campaigns

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         1. How to Identify What to Scale?

    • Look at Performance Metrics

      • ROAS - Is it profitable?

      • CVR - Is the landing page converting well?

      • CTR - Are the ads engaging?

      • AOV - Are customers spending enough per purchase?

      • Frequency - Are the same people seeing the ad too many times?

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         2.  Smart Scaling Strategies

    • Vertical Scaling (Increasing Budget Efficiently)

      • Increase budgets by 20-30% at a time to avoid shocking the algorithm

      • Use automated rules in Meta & Google Ads ("Increase budget if ROAS > 3.5")

      • Don't scale too fast - watch for performance consistency

    • Horizontal Scaling (Expanding into New Audiences & Creative Angles)

      • Duplicate winning campaigns to test new audiences (lookalikes, interests)

      • Try new ad creative & messaging (carousels, UGC, different CTAs)

      • Expand to new placements (reels, stories, CTV, YouTube)

      • Test new ad platforms (TikTok Ads, Pinterest, etc)

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    Scale what's working, optimize what's struggling, and cut what's failing!

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Ready for a deeper analysis?

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Book a Free 15 Minute Ad Audit!

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