To get a 10x return on my ad spend dollars, I bought ads on Facebook, Google, Instagram, and TikTok. Oh, and, Amazon. Their marketing materials each promised me a 1.67:1 to 5:1 return. So, instead of picking one of them, I chose all of them. Genius, right?
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Ads bought and I just hit go.
I’m writing this as I sit by my Google Analytics and various other dashboards waiting for the confirmation that orders for my products will to roll in faster than the clouds zoom by at Everest’s base camp.
In the few minutes it takes me to get rich, I’ll bang out what I imagine will be my last post. I love you folks dearly, but not more than having a captain putter me around Grand Cayman in my 120-foot yacht. Actually, make that 150. I’m going to need something more impressive and helicoptery when I’m accepting my large feline award in Cannes. We all know rich guys don’t wake up at 5-something AM to stuff their thoughts into Notes on an iPhone and post them to Substack.
For months, years really, I’ve been thinking about media and news and pivoting to videos and trust and all sorts of other nonsense. I’m hear to tell you,… none of that matters. Fundamentals are for chumps.
Ad math is shockingly simple. Google says they give me 2:1. That’s their numbery notaton for two dollars back for every dollar I spend. Yeah, I thought it was a Ponzy scheme too. But, they wrote up how the math works on their DIY support page. Quote… Here's the math: $5 USD in sales ÷ $1 USD in ad spend x 100% = 500% target ROAS… Unquote.
I get it. It’s all so simple now. If I spend one dollar, Google pretty much tells me I’m going to get two dollars in sales. I know their example said five. But, I’m not an idiot. They’re overselling. Who cares? Two dollars for every dollar I spend is a win. In fact, it’s better than a win. It’s a freaking perpetual motion machine. I can keep giving Google dollars for years. Google is much bigger than me. I’ll run out of dollars before they run out of ad inventory.
But I can’t run out of money. If I spend one dollar. Google gives me two dollars in sales. So, I have another dollar. Oh, wait. I forgot about margin. Two dollars in sales only yields me about 20 cents in profit. So, I’d need five dollars in sales to make a dollar in profit. See, again, simple math. If I need five dollars in sales, I’d need to spend two fifty with Google. I just knew there had to be a catch. I only have a dollar.
Then, I got smart. Well, in fairness, I didn’t get smart. I saw an ad for DraftKings or something. Fan Duel. MGM Bets? Without help, I can’t recall what brand it was. Maybe with one of those multiple-choice things I see on YouTube, I could remember what ad I saw. Never mind, I’m going off topic. Here’s the important thing. I remember reading, “Why bet on one thing, when you can parlay it?” After googling, “Parlay,” the oyster, which was my world, became clear. Which sounds bad, but it’s good.
Check it. Google gets me 2x. Facebook gets me 2:1 to 5:1. Let’s be conservative and say two. Instagram is 2.87, Amazon is 2, and TikTok is a paltry 1.67. Still, adding them up I get ten. Ten times my ad spend. For a moment, I thought I did something wrong. Then, I realized I did. I was doing them in parallel. You know all of them at once. That’s not going to work. I’d need five dollars — one dollar for every place. Chalk it up to a rookie mistake.
Sequential was the way to go. I’d put my dollar in Google. It would give me two. I would take the two and put it into Facebook. I’m going to play this like a blue-haired lady plays five slot machines at a Tahoe truck stop. I know. You’re laughing. Wondering how I didn’t see this right away.
Here’s the best part. My math is additive. I’m beginning to think it could be geometric. Those are terms I picked up in high school math. Which, I’m finally starting to appreciate. Math = Money! Additive is: 2+2+2+2+2 = 10. I’m beginning to think it could be geometric. 2x2x2x2x2 = well, I dunno. I’m too giddy to even think about how much money might start rolling in.
I’m going to have enough money to buy some fine art for my big boat. I’m thinking Rothkos. Plural.
Funny. The dashboards haven’t done anything yet. I wonder if my screen froze. I’m going to ping my IT guy. BRB.
Hey… turns out the math doesn’t work like this. Turns out each group is taking all the credit for all the sales. Including all the sales I would have picked up without any marketing at all. Well, this is kind of embarrassing. It would have been nice if someone had told me about attribution before I wasted so much of your time. You’d think something this important would be on these mathy websites at Google, Facebook, and all the sites that promised me that spending ad dollars on marketing would lead to riches. You know, like a disclaimer. Past performance doesn’t guarantee future performance. Or, Tide only gets stains out in a lab environment. Or, the person in this commericial was paid by the company. But, nope. The ad world is the oversightless. Which means…
No art. No boat. No celebrating on the French Riveria. I’m depressed. When I’m depressed, I go watch Wedding Crashers. To paraphrase John Beckwith, “ROI doesn't exist! That's what I'm trying to tell you guys. And I'm not picking on ROI, 'cause I don't think marketing exists either.”
Crap. Thanks math. Now, I’m tangled up and blue.