Five Google Ads Leaks That Burn Ecommerce Profit

Come on. In this video, I'll show you the five most critical Google Ads mistakes I see in almost every account, which literally burn through your money and wipe out your profits, right? And no, I won't show you the typical mistakes you've seen all the time, will I? Those fundamentals that they have literally heard about 10,000 times already. We'll delve a little deeper this time, and I'll show you things that certainly happen on your account too, but that you don't normally monitor, right? So we'll delve a little deeper today. We'll be revealing some secrets of Google Ads, so stay tuned and see what's coming. Let's get straight to the point: five mistakes that cost you a lot of money in Google Ads and eat up your profits.

And how do I know about them?

Very simply: we run Media, a Google Ads agency where we currently work with over 200 e-commerce brands across various niches. And the next five mistakes I'm going to show you are some of them; they appear everywhere, right? In every account we take on, in every account we audit, we see typical beginner mistakes throughout our agency when onboarding new clients, or even in our school community, right? So these are typical, but also some of the more advanced ones that even the biggest brands that spend millions a year on advertising make the same mistake, right? Because you can make those mistakes and still be profitable, sure, and you don't even know they're silently eating away at your profits, right?

So, let 's start with the first and most important one right away. Actually, they 're all important, but they understand the idea. Let's start with one and continue

with five. Number four is especially interesting, something that many people overlook or don't think about. So stay until the end of the video. All five of those are super important. So let's get to it. The biggest mistake, by far , that I see even million-dollar brands making is overpaying for customers or warm traffic they already have, right? They overpay for retargeting to the point where it simply goes beyond the optimal level, right? Or especially brands with a subscription model or many repeat buyers, sometimes get too involved in winning those people back with paid ads, right? There are smarter tactics for doing that. Just like with paid advertising, you want to focus specifically on acquiring new customers, right?

That's where the money is, or well, it's not where the money is, but that's where the growth is , right? The money is obviously in repeat customers and subscribers, but that's precisely why you don't want to overwhelm them, right? And then you have those people who say, " Okay, this is what I can afford to pay per customer," but then you see those same brands spending tons of money on excessive retargeting, in a way that no longer reaches the ideal point, right? And again, sometimes these are brands that make millions, right? Because it's not an easy question, right? Like, okay, how do you evaluate it?

How much can I spend on it? How much should I spend on it? And when do you pass that sweet spot, right? So you really need to understand your numbers, you need to understand your data, attribution, and everything else, right? Where does everything come from? The main takeaway is, are we overspending on retargeting? Are we overspending by bombarding these people, or are there smarter ways to keep them informed? Right? I'm not saying you shouldn't do it at all, but there are smarter ways, because the point is that Google doesn't care if you set up a campaign and don't have smart targeting or if your bidding strategy is to maximize conversions or conversion value.

That's what Google focuses on, right? They focus on maximizing conversions. So now you have new potential customers and your existing customer base . Where does Google get the most conversions from? Right? Naturally, they'll focus more on repeat customers if you don't clearly tell them to keep them separate, right? Whether with separate campaigns, clear segmentation with different objectives; There are many options, aren't there? The bottom line is that you want to make sure this isn't a strange mix and that you 're not overwhelming repeat customers for no reason, right? And I've seen crazy advertising accounts where 80% of the budget went just to that, right? And basically you're paying two, three, four, five times more than you should for someone who's already loyal to your brand, you know?

So, especially for larger brands , the more your brand grows, the more important that becomes, right ? If you're still a small brand, you do n't have many repeat buyers or an existing customer base . Obviously, this is less relevant to you right now, right? Hopefully it will be relevant to you in the future, but it's still something you should keep in mind, right?

So, again, the solution: you want to make sure Google is actively searching for new buyers, right? You have a couple of options. You set up different campaigns, basically telling Google with bid optimization: "Hey, I want to focus more on new customers." There are several options, right? We're not going to go into too much detail about setting up those things; that would require a separate video just for that, almost a mini-course, so we're just

focusing on the basics. We just want to make sure we have control over where the money goes. That's the conclusion, right? You definitely want to have control over where the money goes. That's all. Mistake number two, and it's a mistake that every e-commerce expert has made before, right? It's a fairly common mistake. It doesn't matter if you're a beginner or an expert, but beginners especially often make this mistake, right? They never let a campaign, especially a new campaign, a new account, a new creative, a new ad, whatever, they never let it stabilize, right? They always want to over-optimize and reset the algorithm with that, right?

They want to set up a new campaign, try out a couple of new creatives, try this , try that. And that makes sense, right? Obviously you want to find out what works and what doesn't. But again , it's about finding the sweet spot, right? And especially for Google as well. Okay, if you're going to set something up, you first need to gather some data, right? Go slowly, let it work. Don't focus too much on what the CPC is yet. What is the click-through rate? What is the conversion rate? Of course, you want to keep an eye on what he's doing, right? Don't overcomplicate things. Don't judge him yet based on 3 days.

Just let it run, gather some data, and see how it goes. You check if everything is going well . You don't want any obvious warning signs, of course, right ? But you don't go from one place to another in those three days, basically. Or even pause or stop it after three days. We already know those classics, right? People launch a campaign and say, "Oh, I haven't made a sale yet after the first day." Like,

Chris, what should I do? Maybe nothing, you know? Simply nothing . The same goes for budget changes or any kind of change, right? You don't want to make any changes during the period, but with budget changes in general, right? You don't want to go up and down, up and down too much, or make too many changes, even though it's tempting. And it can go both ways, right? When you're climbing fast, sure, take advantage of the momentum, but don't make drastic, emotional decisions, okay? Like when you say, "Oh, ROAS is great. Let's double the budget." And the next day, the ROAS isn't so good anymore because you doubled or quadrupled the budget like crazy, and then the ROAS is bad and you say, "Oh, crap.

You see, I didn't expect that." And then you immediately go back, right? And it's a constant back and forth, and you end up completely ruining the account's algorithm. And again, that's something that both beginners and more experienced people do. And I find that really interesting. I feel that's one of the main benefits of not buying media yourself. Even if you're quite skilled at media buying, and I've seen that before when I was running ads for my own projects, you know? You see it differently. You're too involved , too emotionally involved, which makes you quite foolish when making decisions, frankly. So yes, it's also about emotional control in that sense to some extent, right?

Again, all sorts of changes, bidding strategies, campaign setup, product testing, the same thing, right? You don't want to make too many drastic changes, especially not at the beginning during the learning phase. Otherwise, I insist, he never stops guessing, right? Imagine waking up every day and every day is completely different, do you understand? It's like waking up at a different time, eating different things, going to different places, and working on different things every day, right ? It sounds super exciting, it sounds like a great adventure, but your brain would be totally exhausted, right? As if he didn't even know what was going on. You also lose your sense of time completely.

And it's the same with your campaign, right? If you give it a different change, a different type of input every day, how is the campaign supposed to learn, see patterns, and know what type of customer to look for, right? That requires stability, it requires a routine, it requires habits, discipline, and figuring out how you approach those things, right? Quite rational and straightforward if you think about it. Give it time

, generate sales, and then make changes based on data, right? Not in emotions. Okay, mistake number three is playing around too much with the objective and limiting your campaign or setting the wrong goals for different product groups. TRUE? So, the typical setup is that if you have a campaign and you start playing with the goal too early or set it too high, you could excessively limit your growth. Correct? And I always say, when people ask me about goals, how to set them and when, that it's a very sensitive and sometimes advanced thing, because it depends on the situation: how you configure it, what products you focus on and how the feed is made, right?

There are literally hundreds of variables to configure it perfectly, right? And now, on August 17, there was also a change in how it's supposed to work, which makes it easier in some ways, but more complicated in others. The main thing here is that you don't want to set your goals too high, right? You think, "Oh, I need a three-star ROAS ." I'll set the goal at three or whatever and grow that way, right? But you could limit yourself, and again, it depends on your product category, right? You have different categories where there are different needs. You don't want to build your own cage, do you?

You don't want to build and reach your own ceiling when you don't even know what the potential is, do you? A simple example

: you don't want to have the same target, the same ROAS, for your winners as for new products, right? A simple setup would be: OK, with the winners you have a lot of data. You can potentially push them harder . But even so, if you push them too hard, they could drop in volume very sharply. And at the same time, you have new products where it's like: okay, they need more freedom, right ? If you want to test new products, develop winners, you can't set the goal too high, right? Then you could have underperforming or wasteful products where, well, they're not performing that well. In that case, it makes sense to isolate them by controlling the budget but also setting a higher target there, right?

So having different objectives for different product groups also goes hand in hand with the campaign structure. The conclusion is that you don't want to limit yourself too much. It's always about finding the sweet spot, isn't it? This is also about the optimal point. It's like a bell curve. If you go overboard, great , you have a great return, a great goal, but the volume is very low, right? Then, if your goal is too low, that's fine. No restrictions , but profits could be affected in that respect, you understand? So you want to be somewhere in the middle where you have a great return, decent volume, and basically

maximum profitability, right? Pretty simple, once again. Basically, give it room to grow. Again, it also depends on the product category. And when you make changes, do them in small steps, okay? Don't make a drastic change like going from a target of, say, 190% ROAS to 250%, okay? And expect the same flow, the same result, the same momentum, and the same trend. It doesn't make sense. As a general rule, whenever we change our goals, we tend to do so in small steps. Of course, there are exceptions. Sometimes it's necessary or possible to take bigger steps, but generally, you should always go in small steps, right? And the main thing here is also to monitor profitability, not

just ROAS. TRUE? It's a vanity metric. Ultimately, you want to optimize for profit, and ROAS is just an easy campaign metric to help you steer things in the right direction, right? But that's not the ultimate goal. I mean, ROAS is great, but what's your profit margin, right? That's what matters in the end. And now we have mistake number four, where I said: " Okay, this is something to watch out for and many people overlook it , even very experienced e-commerce operators ." They have all made that mistake at least once before. And I hope it was only once , right? Because this mistake really costs you a lot of money.

And what does that mean, exactly? They themselves rate their own work. What do we mean when we say that Google grades its own homework? Basically, what we mean, and what can cost you a lot of money, is that you implement Google Ads tracking, you look at the ROAS in the ad account, but Google tracks the sales for you, right? And obviously, Google and all the other platforms that exist, right? Meta, TikTok, Pinterest, obviously they all have a great interest in showing you how great they are, right? They all want to report a high ROAS because if you, as an e-commerce beginner or even a naive expert, see: " Wow, Pinterest is killing it!" We have a ROAS of five on the advertising account right now, right?

And you double the budget and double it again and the ROAS is still excellent, and look, Meta is also incredible. Google is fine too. And then you have all these amazing ROAS in your ad account, right? And then you look at the actual figures in your bank account at the end of the day and you're like, "Well, what the heck is going on here?", right? It's like, I have this great ROAS of five on Google, Pinterest, Meta, whatever, but there's no money in my bank account, you know? There are no profits at the end of the day. So

how is that possible? And this is especially relevant for you if you run campaigns on multiple platforms, right? This is not something specific to Google. In fact, I'd say Google is doing quite well in terms of tracking. But there are other platforms that over-attribute, especially if you advertise on multiple platforms at once. TRUE? Imagine a scenario where you advertise on Meta, Pinterest, and Google, and you have touchpoints on all three , right? The three of them obviously want to claim the conversion. So you have one sale, but you see three in the ad account, right? That is exactly the gap, the problem we are discussing here.

It's like: no, ROAS is not five. You probably have a ROAS of two, right? So you need to look at the combined ROAS, the marketing efficiency index, and your actual profit numbers , right? You need to do your calculations, you need a proper data analysis. Tools like Triple Whale will help, but you also need to understand the attribution settings in your ad account. Pinterest, for example, or Meta too , often include view attribution, right? In other words, people aren't even clicking on your ad. They don't even visit the website. They just see the ad and then convert. For example, like on Pinterest, right? If you have clicks for 30 days, views for 30 days, they see the ad and 28 days later they convert through, say, Google or organically, it doesn't matter, right?

Pinterest will actually count that sale. So, you have a strong over-attribution in some of these channels. Pinterest is crazy about that too, right? And many people don't

understand it. As a little anecdote, I had a client like that. We were killing it at Google with him, weren't we? We him. Honestly, we had very good results, a very good return on investment. And this guy comes to me and says, "Dude, we're not making any profit. We need to shrink Google immediately, right?" That was his first instinct. I said, "That doesn't make sense. You have at least a 30% net profit margin coming from Google here, right?" And then we reviewed their numbers and analyzed the data a little more. We knew it was operating on multiple channels: Meta, TikTok, and Pinterest. And then we sat down, right?

I had a call with him and I said, "Look, I'll basically explain everything I'm explaining to you here now, how attribution works, right? You can't look at it that way." We started to reduce Pinterest and Meta, specifically, or TikTok, which in that case was also burning a lot of money, and we installed Triple Whale for it, right? You can use any other attribution, and then we actually saw: "Okay, we're wasting a lot of money there, aren't we?" Google was genuinely good; We had a ROAS of like three or four, something like that, again, it was close to the 30% net profit margin for this client , but it was scaling on TikTok with a ROAS of like 0.8, you know, a total loss there.

Pinterest was very similar, 1 point something, I don't remember exactly . Yes, a great waste, isn't it? Because again, why? Because he was looking at the advertising account data , right? You go to the advertising account and Pinterest said we were killing it. TikTok said we were amazing. You should double your budget. You know, at the end of the day, I was just burning through money like crazy. So always look at the combined rows, understand the math in general, understand your own data, and don't scale blindly. Don't look at the

advertising account roles, you know, as if the number there wasn't real from the start. It's something to keep in mind, something we also review, but we never make decisions based on that account data. You know, it doesn't make sense. And last but not least, the budget. Can you see what that means? And we're talking about PMax, Performance Max, and the black box, the famous black box, which means they don't see everything that happens in their Performance Max campaign. TRUE? So, the first thing we need to understand here is that PMX isn't just Shopping, right? People always think this is just Shopping, and we set it up in a way that it's primarily Shopping for most of our customers.

It depends, right? But usually, people who know us, work with us, or follow our other videos know that we do something called PMax just with feed . It's nothing new, is it? But basically, that way you force Google to spend your money primarily on Shopping, because by default PMax should work on all channels, right? Shopping, search, display, YouTube, the discovery feed, everything. So what that looks like is, okay, you have a really good ROAS in Shopping, but a lot of cheap display and YouTube clicks in between are burning through your money. And the interesting thing, and this is the important part you need to understand, is that this can happen even if you set it to PMax with feed only, right?

Because there is no longer a real "single

feed"; It's just a feed, but Google will still try to sneak in some clicks from random places sometimes, right? Especially if you make mistakes during setup and don't uncheck some of these boxes to make it even worse, and you have a lot of cheap waste coming in from all over, especially if the algorithm is a little confused. Sometimes you see a lot of nonsense from Display and YouTube coming in there, right? Solo feed is no longer just feed. It never has been. So, you really need to understand what's going on in your PMax campaign, how it works. And there are many other black box variables as well, right?

Even with search terms, for example, you do n't really see what's going on there, or Google only shows you some parts. You have to understand that there are many black box variables and you need to understand them as best as possible, right? We want to understand: Where is the money really going? Is everything set up correctly? Do the metrics look right? Many things we see lately are, for example, this type of shadow banking, right? Where you have an increased CPC, but at first you don't even notice because the average CPC seems good mixed with cheap junk traffic, and the CPC of purchases that matters can be extremely high, right?

So you need to understand your data; Don't trust them blindly. There's a lot of behind-the-scenes stuff going on with PMax, and you need to bring it to light, right? You need to understand what's happening; one thing you can do to control it. Of course, with search terms, you can see that strange things come up , competitor terms that are not profitable. You can add them to a negative keyword list at the account level or something like that, basically add it to the B-Mix, right? Delete that. And yes, all the other things we discussed earlier with the general report, seeing where the spending is actually going, right?

So what you do n't want to do is let him run blindly and trust him completely, right? And again, what we discussed: mistake number one, really the biggest one. You don't want to overbid your own brand for warm traffic, for existing customers, do you? Especially if you're a bigger brand and involved with PMax, because PMax will go where it can get the best results, i.e., the highest ROAS, the highest number of conversions, which , as we discussed, isn't always the best for you, right? So you need to have a clear division there too and be in control of what happens. Quick summary, those five

again, as we said, mistake number one, don't overspend on customers you already have. Don't make constant adjustments, especially during the learning phase , but as a general principle, right ? Like, don't overdo it. Be very strategic with your changes. Don't limit yourself too much with the target ROAS. If you use target ROAS, again, have very strategic divisions about how you configure those campaigns. Don't trust Google data. And again, this is not something exclusive to Google. It says here that Google creates its own task. This applies to Meta, Google , Pinterest, TikTok, Snapchat, any other platform you can think of, right? Because they're interested in showing you how great they are, even if that's not the case.

So you should also be very careful with add-on data in that case. And last but not least , as we just mentioned, the PMax black box is also here; Don't trust her blindly. Take control of your data, your numbers. Understand your numbers. That's more or less the key conclusion, right? You need to understand the numbers and what's going on . And only then will you be able to make good decisions, right? Very good. Now you're equipped to stop leaks in your ad account. If you want to learn more about things like this and how to manage your campaigns across the board, whether it's Google, Meta, or anything else.

If you want to learn how to post ads correctly, contact me or join the free school. The link is below. Learn more. We are already more than 1,000 operators in the school, dedicated exclusively to scaling and growing in Google Ads. So, see you there. See you in the next video. And that's all for today.