If you could double your business now, would you?

If you could double your online business, would you?

This same question applies to a website that generates leads into a sales process, not necessarily just eCommerce.

Both are a numbers game.

Here’s a realistic example for eCommerce Sales, let’s say:

Quality traffic = 10,000 in a month, cost to generate using Google Shopping Ads was $10,000.
Total market visibility share in paid advertising is less than 15%.
Sales conversion rate is 4% from traffic (4% of 10,000 is 400 transactions)
Average Basket Value is $200
Total sales revenue is therefore $80,000 ($200 x 400).
Cost of marketing is therefore 12.5% or revenue, ($10k / $80k)
Average NET margin is 45% of sale, so every extra sale is profitable.

So on the basis of the above basic calculation, WHY would you NOT scale up your advertising right now?

Valid reasons not to scale could be issues around logistics – can’t land stock fast enough, can’t store stock, can’t dispatch sales fast enough. But let’s say you could solve these easily or didn’t have them at all, what then?

Why not double the traffic, double the marketing budget, double the market visibility share to 30% and DOUBLE the REVENUE?

Actually: you could easily QUADRUPLE (4X) this business with about the same rate of profitability, and probably better if you get concessions at the inventory buying end.

It’s just math. But it does depend one super important factor:

Is the market visibility share calculation valid? (We do this for our clients). This is a metric that must fit within a very specific tactical approach to advertising in Google. If the tactic isn’t quite right, then the metric becomes unreliable or blatantly wrong.

I have access to another set of data where I see the following scenario: