The one case where having a good ROAS is a bad thing

There's a common belief that branded campaigns are easy to run on Google, and that anyone can manage them without much expertise.

There’s some truth to that.

Branded traffic is the closest thing to a guaranteed conversion on Google.

These campaigns can hit insane numbers with a fairly simple setup.

But that comes with a hidden problem.

In branded campaigns, the ROAS tends to look good regardless of how broken the setup is.

You can run them in a suboptimal way and still pull a 5+ ROAS.

We've audited several brands doing 8 and 9 figures in revenue.

You'd think brands that size have the basics covered,  especially something as simple as branded search.

But when our team reviewed their accounts…

One brand was paying up to $15 for branded clicks.

That's 10-20 times higher than what they should've been paying.

After we fixed their setup, their branded CPC dropped to an average of $0.18.

Another brand we recently took on was running branded campaigns at a 9x ROAS.

After we corrected their campaign structure, CPCs dropped by 43%, from $2.1 to $1.2. ROAS jumped to 18x.

Their branded revenue more than doubled without spending a single extra dollar.

For many others…

Their "branded campaigns" were pulling in searches that had nothing to do with their brand.

I’m talking about terms like "app for meditation" and "music," which of course, generated 0 conversions

Now, there’s a wide range of reasons this happens…

It could be poor campaign structure where branded keywords leak into prospecting campaigns, or branded campaigns pull in non-branded terms.

It could be a weak keyword strategy where the campaign fails to cover all the variations people search for the brand.

It could be the wrong bidding strategy or match type settings.

Or the most dangerous reason of all, and also, the hardest to catch:

Some agencies do this on purpose.

They intentionally let prospecting campaigns capture branded traffic, so the prospecting numbers look better in reports.

Whatever the cause, your brand’s paying for the damage in one of two ways:

• You're not capturing all the traffic that already belongs to you

• You're overpaying for traffic that should have been dirt cheap

I don’t think the belief that branded campaigns are simple to run is wrong.

The mistake is assuming simple to run and optimized mean the same thing.

Because like I said earlier…

None of these issues shows up as an obvious problem.

The numbers look acceptable, so nobody looks closer.

As a result, a lot of founders I talked to had no idea anything was wrong… by which point they had been leaking 5, 6 figures in revenue every single month.

This is why I say a decent ROAS can be more dangerous than a bad one, especially for bigger brands with the budgets to spare.

When you get a bad ROAS, you fix it

When you get a decent ROAS, you leave the account untouched while quiet issues drain your budget for months.

Jackson

Founder and CEO of Echelonn.

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