Many Australian small and medium enterprises (SMEs) struggle with ad spend – feeling like money is disappearing without a clear return. It’s a common challenge, and thankfully, one we can address with a few key strategies. Optimising isn’t about spending less, it’s about spending *smarter* to generate a higher return on investment (ROI).

The first step is understanding your Customer Acquisition Cost (CAC). This is simply how much it costs you, on average, to win a new customer through your advertising. Knowing this number is crucial. If your CAC is higher than your customer lifetime value (the total revenue a customer brings in), you’re losing money. We recommend calculating this regularly – at least quarterly – to stay on top of things.

Here are a few practical ways to improve your ad spend efficiency:

• Refine Your Targeting: Broad targeting wastes money. Platforms like Google Ads and Facebook Ads allow incredibly specific targeting. Focus on demographics, interests, behaviours, and even remarketing to people who’ve already shown interest in your business.
• A/B Test Everything: Don’t guess what works, *test* it. Run multiple versions of your ads – different headlines, images, calls to action – and see which performs best. Small changes can have a big impact.
• Focus on Conversion Rate Optimisation (CRO): Driving traffic to a poorly designed or confusing website is a waste of ad spend. Ensure your landing pages are clear, concise, and make it easy for visitors to convert – whether that’s making a purchase, filling out a form, or calling your business.
• Prioritise High-Intent Keywords: If you’re using search advertising, focus on keywords that indicate a strong buying intent. For example, instead of “running shoes”, target “buy women’s running shoes online”. These users are further down the sales funnel and more likely to convert.

Finally, remember that attribution modelling is becoming increasingly important. Understanding which touchpoints in the customer journey are contributing to conversions allows us to allocate ad spend more effectively. While complex models are emerging, starting with a simple ‘first click’ or ‘last click’ attribution report within your ad platforms is a great first step.

To truly optimise your ad spend, we recommend starting with a comprehensive audit of your current campaigns. This will identify areas for improvement and provide a clear roadmap for maximising your ROI. Don’t hesitate to seek expert advice – a small investment in strategic guidance can yield significant returns.