In today’s ecommerce world, growing revenue is only half the battle; protecting your margins and driving profitability is what really matters. With increasing ad costs, changing consumer behaviour, and fiercer competition across digital platforms, making informed decisions about where and how to spend your marketing budget has never been more crucial. Here’s how to reevaluate your approach across key channels to improve results without just spending more.
SEM: Build Strategy Around Profit, Not Just Revenue
The transition from return on ad spend (ROAS) to profit on ad spend (POAS) is revolutionary in search engine marketing. By factoring in the cost of goods sold (COGS) and segmenting products by margin, you can ensure your budget supports initiatives that truly impact the bottom line. Structuring Performance Max campaigns around high, medium, and low-margin categories and reporting on POAS and margin alongside traditional ROAS and CPA, gives a clearer view of performance. This helps you identify what is driving vanity metrics and what isn’t.
SEO: Driving Organic Growth Without Relying on Ads
When executed with a well-thought-out strategy, SEO can be your most cost-effective channel. For example, Google’s strategic approach to SEO means it sees almost 290 times more searches than its closest competitor (Datos). It is important to focus on high-intent, low-competition keywords to drive traffic that’s more likely to convert. With fully optimised product and collection pages, you can reduce your reliance on paid media and reserve budget for the times of the year that require an extra paid push. When done right, these optimisation efforts can also help reduce your paid advertising cost by reducing the cost per click (CPC) on Paid Search.
No matter which channel customers arrive from, the on-site experience, especially site speed, is crucial and can’t be overlooked. Site speed will have a direct correlation with your bounce rate and conversion rate, as well as the likelihood of a repeat visit. There are many tools available to monitor your site speed, and it is one metric that should be regularly monitored.
Here are some of the tools our SEO experts usually rely on to get their data:
Finally, don’t underestimate content marketing. Investing in well-structured, search-optimised content not only helps attract new customers organically, but also nurtures consumers into considering your product line, while building brand trust and authority over time.
Social: Smarter Spend Through AI and Audience Targeting
Social media is a powerful tool for building awareness, but without a clear strategy, it can quickly become a costly exercise. An effective way of reducing your reliance on paid reach is boosting user-generated content (UGC) and tapping into influencer partnerships. Focusing ad spend on high-margin products and retargeting high-intent or loyalty customers can help you get more out of every dollar. If you provide Meta with the correct signals, its Advantage+ Shopping campaigns can help automate placements and creative, reducing time and increasing efficiency. More impressions don’t translate into profit; instead, more intelligent targeting does.
CRM & Email: Behaviour-Led Segmentation Wins
Email and CRM are very effective channels for driving profit, particularly when messaging is tailored to specific customer behaviour. Start by understanding the difference between your full-price and sale buyers before customising campaigns to suit each group. Instead of providing general discounts, use loyalty benefits, VIP access, or post-purchase incentives to promote upsell and repeat purchases. You can also discover the optimal balance between conversion and margin preservation by A/B testing discount messaging against no-discount control groups.
Marketplaces: Know Your Numbers, Play the Long Game
Marketplaces like Amazon and eBay have the ability to drive huge volume, but without careful planning, profit can disappear fast. It’s important to know your unit economics inside and out, including landed cost of goods, platform fees, returns, and ad spend. Not every product should be promoted the same way. Tailor your marketplace strategy to your brand’s stage, whether you’re launching, gaining market share, or clearing old stock. Be selective with promotions; tentpole events can drive strong results without the need for always-on discounting. Ultimately, marketplaces reflect your broader distribution strategy, so ensure what you see is what you want to scale.
Focusing on profitability doesn’t mean doing less marketing; it means doing smarter marketing. By digging deeper into your data, tightening your targeting, and aligning spend with your margins, you can grow your business in a way that’s both sustainable and profitable.
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