Does running ads actually make money?

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I'm probably the biggest fan of organic growth you'll ever meet.

I don't like VCs. I don't like spending money recklessly.

I'm all in on building a personal brand and growing an audience through organic channels.

But over the last year I started experimenting with ads for all my products, and I'm willing to change my mind.

It's not ads or organic. It's ads and organic.

And the mix is what matters.

Here's how I run ads, what they actually return, and what I got wrong 👇

Ads come after profit

Every product I build is profitable from day zero, so ads are never how I test a new idea.

I wait until a product hits $5k to $10k MRR.

Then I invest heavily, but only what the ads themselves generate.

If $10k of spend brings in $20k, next month I'm willing to spend up to $20k. Never more.

It's a loop that funds itself, and this incentivises us to get better at running ads instead of throwing money at the problem.

Plenty of people test ideas with ads from day one, and that's a valid strategy too. It just isn't mine.

I try ads on every product, and where I can't make them work, I stop.

The creative system

If you've read anything about performance marketing online, you know how valuable creatives are. They make or break your campaign.

We ship about 65 new ads a month. Each ad is a different concept, with hook and CTA variants under it. New ideas get tested in small ad sets, and winners get promoted into a campaign where Meta spreads the budget.

Here's what is winning:

1 - An ASMR-style concept, our top spender

2 - Plain static images, which get us large traffic at a large budget

3 - A raw viral clip, which gets us super cheap new customers but at lower volume

My 4 biggest lessons:

1 - Hooks matter more than production.

2 - Statics often beat polished video.

3 - The best ads are UGC. You may pay for it as a sponsorship, but let it run organically first. If people watch it without a paid push, it's likely to make a great ad.

4 - It's very hard to invent new formats. 99% of the time, go back to what people are already doing. That's why we built an ads library, so you can see high-performing ads and recreate them for your brand.

Our hottest hook for outrank.so right now: "Fire your SEO agency"

PS: if you've seen this ad in your feed, do let me know 👀

Tracking is the real alpha

Everyone says creative is the highest-leverage part of ads. They're probably right.

But tracking is what makes the entire thing worth it.

Ads only work if the audience is right, if you can retarget people who visited, and if you can track conversions and traffic correctly. And tracking is the most important piece.

That’s how you’ll know everything works.

We reworked it several times. Here's what we found:

1 - Meta and Google both over-credit themselves, so we judge based on paying customers.

2 - YouTube views were being counted as conversions

3 - Affiliates were running their own Google Ads to our site

A Squad.so agent now reviews the account every week and proposes actions. A human approves each one before anything changes.

The verdict

Okay, so considering everything - where do i stand?

Here’s some math:

1 - An ad-acquired customer costs us about $500-$1k

2 - Only about 22% of new paying customers first came through an ad. Organic still crushes.

3 - On the standard plan, a new customer turns profitable in less than 6 months for us. Not bad.

The rest came direct, from organic search, or from social. Some of that "direct" is probably people who saw an ad first, so paid is somewhat undercounted.

My take:

Ads rent attention and stop the day you stop paying.

They're great for testing messages fast, and 65 ads a month is the quickest feedback loop we have. The real value is when they speed up a channel you own.

Organic search alone brought in about as many paying customers as Google Ads, at zero media cost.

The blog and SEO for every one of my companies runs on Outrank, and you can try it here: outrank.so

Reply and tell me 👇🏼

Do you run ads for your business? what’s your biggest blocker?

Would love to read what you think.

I read every reply and often write back :)

Video of the week

I released the free collection of the best motion graphic videos that I could find.

You can use this as inspiration to help AI create your next motion graphic video.

Check it out here:

Tweet of the week

This is super valuable in the age of AI slop:

Until next week,

Keep building

Tibo 💻