How to Optimize ROAS & Lower Break-Even Point: 7 Techniques for Dropshippers
Rebekah Braceon September 8, 2022.
Learning how to optimize Return on Ad Spend (ROAS) is crucial for any business owner. Understanding this metric allows e-commerce site owners and dropshippers to lower their break-even points, thereby generating higher profits from every marketing campaign.
This is crucial at a time when digital ad spend is set to reach around $735 billion worldwide by 2026. Achieving a good e-commerce ROAS means knowing how to measure the effectiveness of each ad campaign and using what you learn in future strategies. The more you optimize ROAS, the less you’ll pay to acquire new customers as a store owner or dropshipper.
So, how do you get the best returns from your ads?
1. Increase CTR on Your Landing Pages
Getting someone to click on your ads is just the first step for any dropshipper. You also need to ensure your customers will engage with your content, and act when they reach your landing pages. Optimizing your landing pages can boost your chances of conversions and enhance the sales funnel.
To increase click-through rate (CTR) on a landing page, dropshippers should:
- Focus on benefits: Highlight the benefits available to your customers as soon as they arrive on your landing page, reflecting the offers you included in your ad.
- Streamline the landing page: Remove any content that isn’t necessary and focus on guiding customers through the page with a combination of video, text, and imagery.
- Leverage social proof: Give customers evidence they should interact with your brand in the form of positive testimonials and reviews.
2. Compare Performance Across Channels
Many dropshippers use a variety of different channels to attract and connect with clients, including email marketing, various social media platforms, and online content. However, not all of the channels you use will generate results.
Comparing your ad performance across different channels and determining which strategies lead to the most conversions or acquisitions will ensure you’re using your budget as effectively as possible. Use analytical tools like Google Ads and social media insights to track where the majority of your customers are coming from.
3. Improve Your Targeting
Customers want ads specifically tailored to their needs and expectations. If your targeting strategy isn’t effective, you’re wasting your ads on people who aren’t likely to convert. Getting to know your target audience better and adjusting your marketing campaigns to use the right language, images, and strategies will boost your ROAS and reduce your ad spend.
Consider exploring the difference between remarketing vs retargeting to attract previous visitors to your website, so they have a second chance to purchase.
4. Maintain Consistent Messaging
One of the most important things customers look for when deciding which dropshipping companies to buy from is credibility. Your audience wants to be able to trust your brand to deliver a consistent, meaningful experience.
Ensuring consistent messaging across all channels can help to develop a greater level of trust and increase conversion rates. It also helps to reduce bounce rate from your landing pages. The points you make on any ads you produce should relate directly to the topics on your landing page, showing customers they’re in the right place.
5. Perform Keyword Audits
Keywords are among the most valuable tools dropshipping and marketing companies use to connect with audiences. Keywords can be used across social media, search engines, and even guest posting campaigns. The keywords you choose can also have an impact on your ROAS.
Bidding for certain keywords and terms across multiple channels can be costly. Knowing which terms actually connect with your target audience and which don’t deliver the right results means you can organize your budget accordingly.
6. Improve Your Ad Copy
Ad copy is one of the most important factors that determine whether your customers will actually click on your ads and engage with your business. The right message needs to showcase your personality, highlight the benefits of your offer, and still adhere to search engine and Facebook advertising best practices.
There are a number of ways to improve your ad copy, such as using AI in advertising to detect the common words and phrases your customers are most engaged by. It’s also worth A/B testing different messages to measure their emotional impact on your audience.
7. Capture Leads Wherever Possible
Finally, there are a number of ways you can capture leads and engagement. If you’re only advertising on Facebook right now, you could be missing out on opportunities available from search engine marketing and email campaigns.
Consider spreading your ad spend across multiple different channels and environments to see whether there are any new places where you might be able to capture new leads.
Producing effective e-commerce ads can take significant time and focus. However, measuring your ROAS break-even point can be a good way to determine whether you’re investing in the right strategies for your business. The more you optimize, the better your return on investment will be.