Increase ROAS to Scale Sales

Competition among ecommerce businesses is increasing day by day. To stand out, you should efficiently use your marketing and advertising budgets to make the most out of your business. One of the key ecommerce metrics companies use to measure their success is the Return on Ad Spend (ROAS).

?ROAS measures the ratio of the revenue you make per every dollar you spend on marketing. It shows the returns from a certain ad campaign to help business people determine the effectiveness of a campaign.

How to Calculate ROAS

As an advertiser, you should aim to improve your ROAS performance for more gains—a higher ROAS signals that your ads are performing well, which could result in high sales. Before looking at how to increase ROAS to scale sales, you first need to know how to calculate it.

ROAS calculation is simple. The formula looks like this;

ROAS = Revenue from advertising ÷ Cost of advertising

For example, if you allocate $5000 to a pay-per-click campaign and the clicks generate $15000 sales, your ROAS is $3. This means that every dollar you spent on ads yielded $3 worth of sales.

Increasing ROAS to Scale Sales

Marketing and advertising campaigns promote sales. Some ways to increase ROAS to increase sales are;

1.????Targeting the Right Audience

When creating ads, identify and target the people who are more likely to buy from the business. When targeting the audience, some advertisers will narrow it down to the geolocation, job title, age, and gender.

You can also create different audience personas and then reach out to each audience segment. You should also consider retargeting. This involves scripting compelling ad copy to target your previous site visitors, increasing their buying chances.

2.????Use the Right Keywords

Using the right keywords while also targeting the right audience could increase sales. Keywords attract other people searching for similar products as yours to your page. Create long-tail keywords to reduce competition and costs and to get higher post-click conversion rates.

3.????Get a Well-Designed Landing Page

Nothing beats a well-designed landing page when driving conversions. Your landing page should focus on the single conversion goal with a stunning call to action. Avoid including other links that could distract the page visitors.

Your landing page should also be user-friendly and able to be used with various devices. Another way to ensure you have the perfect landing page is using persuasive language. This feature attracts customers and can convince them to buy.

4.????Increase the Revenue per Conversion

A business aims to make maximum profits, and one way to earn more is by increasing the revenue per conversion with the post-click experience. For example, you can increase the average order value (AOV) by offering your customers free shipping if they buy in bulk.

5.????Reduce Cart Abandonment

Some customers will select items on the site but not go on to buy them. It could be due to a lack of clear information on your site or challenges in making payments. You can reduce cart abandonment by providing all the necessary information to buyers. Also, offer guest checkouts.

Final Words

ROAS measures the ratio of revenue you earn per every dollar you use when marketing. A higher ROAS ratio indicates that your business is doing well. You can increase the return on ads spent by targeting a specific audience, using the right keywords, designing your landing page, and reducing cart abandonment.