ProfitSpring, PPC and paid social marketing agency have created an ad profitability calculator to help SMEs understand if their advertising is returning well to close the gap and break even or profit. You can use the calculator here.

After years in the industry, Byron Marr, Founder at ProfitSpring – PPC and paid social marketing agency –  found that there’s a disconnect between marketing optimising and measuring based on return on ad spend (ROAS) and directors and shareholders wanting to optimise for profit.

A one-size-fits-all approach from benchmarks doesn’t work as businesses can have very different margins, growth targets and are in different lifecycle stages. For example, a 4:1 ROAS might be viable for one business but not for another. 

Ensuring targets are commercially underpinned means even a smaller brand can advertise, acquire customers and grow without making a loss.

Byron Marr comments on why he felt this new tool was vital for the PPC and paid social marketing industry: 

“On a more tactical level, you have to input these targets now in Google & Meta. Entering too low of a target ROAS can mean blowing the budget very quickly and not seeing a return, too high of a target can mean you don’t get any click or sales volume. We need to get the input correct for machine learning bidding strategies to have a chance at getting the output right.

“I wanted to remove the complexity and time it takes to work out these sorts of figures, and having the tool means that anyone can access the output in just a matter of seconds.”

With advertising costs being one of the largest monthly expenses for most brands, Google Ads is very often the channel carrying sales and revenue. 

“Our tool gives SME owners a quick and easy way to see if their advertising is returning well enough and if not, where they need to get to close the gap to break even or profit.

“We hope we’re able to support businesses in making more informed decisions with their investments by simplifying some of the complexity around this topic.”