Modern marketing budgets require flexibility and scalability on the platforms they spend on. The days of pre-buying massive media placements are over. We live in a world of digital day trading that allows for brands to scale their spending based on the success of a campaign. This requires a shift in mindset and accounting flexibility.
17. F i x e d
B u d g e t
P e r f o r m a n c e
B u d g e t
18. W h y O p e r a t e O n A P e r f o r m a n c e
B a s e d B u d g e t ?
19. R e d u c e s R i s k + I n c r e a s e s U p s i d e
20. A l l o w s Yo u M a x i m i z e T h e
F u n c t i o n a l i t y O f Yo u r To o l s
21. R e m o v e s C r y s t a l B a l l P r o j e c t i n g
22. A c c e l e r a t e s P r o d u c t M a r k e t F i t
A n d I n c e n t i v i z e s Te s t i n g
23. F o c u s e s O n T h e “ R i g h t G o a l s ” A n d
P e r p e t u a t e s F i n a n c i a l H e a l t h
24. H o w d o y o u b u i l d a p e r f o r m a n c e
b a s e d b u d g e t ?
25. I d e n t i f y A G r o w t h S t r a t e g y
p r o f i t v s . c u s t o m e r s
26. What is the cost of 1 unit
(fulfilled all the way to the customer)
U n d e r s t a n d Yo u r U n i t E c o n o m i c s
Operating Cost Of Necessary Functions Of Sale
Units/Order
Average Order Value
Fuel Profit
COGS
27. S e t Yo u r C PA
Fuel Profit ($) “Goal” Profit ($) Target CPA ($)- =
28. 15
Purchases
CPC
Conversion Rate
AdSpend
X =
.8%X =
$1
AdSpend
~$2,000/Ad Set To Determine Viability
Average CPC = $1 Average CR = .8% 15 Purchases To Optimize
D e t e r m i n e T h e C o s t O f V i a b i l i t y
31. Unit Economics
1.7
$40
$7
QALO
$28
What is the cost of 1 unit
(fulfilled all the way to the customer)
Necessary Operating Costs
Units/Order
Average Order Value
Fuel Profit
COGS
32. Target CPA
$12
Using FB Default 28 day click and 1 day view
Fuel Profit ($) “Goal” Profit ($) Target CPA ($)- =
$28 $16
33. Ad Spending By Month
0
20000
40000
60000
80000
Ad Spend
January August
$300
$80,000
