adnovation’s in-house team of marketing and advertising experts manages SEM, Social and and Programmatic campaigns, working with industry leading partners including Google Ads, Meta Ads, Smadex and Taboola. Our experts are therefore up-to-date with the most effective advertising, bidding and optimization strategies. 

Recently, one of our experts, Performance Media Buyer Arnau Sans Ballester, produced an insightful article on ‘How to Get the Most From Your ROAS Campaigns’. This article was originally published at PPC Hero’s blog. The aim of this article is to help online marketers, advertisers and affiliates worldwide understand the key aspects of achieving best results out of their ROAS campaigns. 

The article assumes a basic understanding of Google Ads bidding strategies such as “Maximize Conversions” and “Target CPA”. Throughout it we will dive into how ROAS campaigns work, setting values with Lead Scoring, optimizing ROAS campaigns, and finish off with the key takeaways from ROAS Campaigns in Google Ads. Let’s take a look at what are ROAS Campaigns and how they work:

What are ROAS Campaigns and How Do They Work?

Rather than focusing on achieving a conversion at a specific cost per acquisition ROAS campaigns, also known as “Maximize Conversion Value” campaigns, aim to maximize the revenue from conversions. Google does this by considering the value you’ve assigned to each conversion, either dynamically or statically.

Dynamic Values: Dynamic values are commonly used in e-commerce. With a technical integration, you can send the price of each product to Google Ads, allowing Google to bid based on the actual value of the products. Platforms like Shopify simplify the process by automatically providing these values without additional integration.

Static Values: Static values are simpler to implement. These values are set manually by the account manager based on their knowledge of the most profitable products or anything the media buyer considers. This method gives you more control over the strategy. You can decide the values yourself rather than relying on Google to determine them based on actual prices, not profit or custom values.

In both methods, the goal is to provide more data points for Google to optimize the campaign effectively. This approach is particularly powerful for businesses with multiple conversion points. For example as e-commerce sites with numerous products or lead generation funnels with various events.

Hereafter, we will be using the static values method, which gives more control over our data. Now we will learn how we can attribute scores to every conversion. This is what ROAS Campaigns are and how they work.

Lead Scoring: the Key to Mastering ROAS Campaigns

According to Enrique del Valle, “lead scoring consists of giving a different value to each type of conversion that does not have to be economic, we could call it points (score).”

Setting Values with Lead Scoring

Here’s a simple way to assign values based on conversion rates between the different events throughout the funnel:

Identify key events in your funnel (e.g., view product, add to cart, purchase). In our case, our data will be the following:

120 viewed pages     –     14 started payment forms       –      6 purchases

2. Calculate the conversion rates for each event from the first viewed page event.

3. Assign an initial value to the first event. (i.e. 10)

4. Use a formula to calculate the values for subsequent events:

X (next metric’s value) = (initial metric*initial metric’s value) / next metric

Don’t panic. Here’s how the formula looks with the information we have:

Started Payment Form Value = (120*10)/14 = 85.07

This means if we put a viewed page with a value of 10, there have been 120 viewed pages, and out of these, 14 started payment forms have taken place, the value of the started payment form will be around 85. It’s the same process with the actual purchases:

Purchase Value: (120*10)/6 = 200

The value of the purchase here will be 200.

These values will help kick-start your ROAS campaign by providing Google with clear indicators of the importance of each conversion type.

How to optimize ROAS Campaigns: Balancing Values and Targets

It might be tempting to assign high values to all conversions to maximize ROAS. It’s crucial, however, to maintain a balanced relationship between the values and your target ROAS. 

Example of how to optimize ROAS Campaigns

Consider two campaigns with the same total spend and conversions, but different conversion values:

The point of this table is to demonstrate that if the relation between the values (in other words, the distance between them) remains the same, the obtained ROAS (in Google’s eyes) in the minor values will be less, and the cost per conversion (CPA) remains the same as well. 

What does this mean? The lower values you set, the lower the target ROAS is expected, and the easier it is for Google Ads to achieve.

Key Takeaways from ROAS Campaigns in Google Ads

At adnovation, we promote subscription-based products across many countries in the EMEA region and more. Our experience with lifetime user value and user acquisition campaign with challenging CPA goals has led us to several conclusions about maximize conversion value campaigns:

• Strict CPA Goals are not ROAS campaign’s best friends: The algorithm for these campaigns involves more variables, making it less precise than tCPA campaigns. This takes to the next takeaway.

• If you are scaling accounts, have a go: tCPA campaigns and ROAS campaigns don’t bid for the same auctions, so if you have a stable group of tCPA campaigns, launching a ROAS campaign alongside them will for sure help you scale maintaining your ROI.

• Lead Scoring Strategy is Worth the Try: Lead scoring is complex but worthwhile. Here at adnovation we always have some of them running live for the sake of learning how they work. It requires more data points and patience but can be effective for high CPA goals where there’s more room for adjustment.

About PPC Hero

PPC Hero is an initiative developed by Rough Agenda, a company founded by Kelvin Newman, which organizes specialist digital marketing events including BrightonSEO, where they tackle real industry issues and give practical advice from experts. The goal of PPCHero is to educate the world on the successful pay per click management, putting online resources such as online training, guides and workshops available to advertising rookies and veterans worldwide. 

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Formerly known as MobileCashOut, adnovation is a leading digital entertainment creation, licensing, promotion and monetization business focusing on various verticals including Ed-Tech, Wellbeing, Lifestyle and Entertainment. We currently produce and distribute content to +13M users across 25 markets, operating in Europe, Africa and the Middle East. 

We convert Business Intelligence based data analysis into strategic business decisions, ensuring that we can provide in-demand products and valuable digital content. We are in constant collaboration with household name brands including Disney, Marvel, and many others. 

Are you interested in our digital content and advertising services? Do you have more questions about what are ROAS Campaigns and how they work? Wondering how to drive growth with adnovation? Get in touch with us now!