Why a Kids' Brand Spending $30K/Month Couldn't Hit ROAS Targets
Audit Snapshot + Key Lessons Learned
Client Snapshot
$30K
Monthly Ad Spend
Consistent investment across channels
1.5x
Actual ROAS
Well below target performance
4x-6x
Target ROAS
Profitability benchmark
$34
Average Order Value
Kids' products e-commerce
Industry: Kids' Products (E-commerce)
The Challenge
Despite consistent ad spend, performance declined significantly:
ROAS Crisis
Performance slipped well below profitability thresholds, creating unsustainable advertising economics
Pricing Pressure
Prices were increased by approximately 25% across all product lines
Competitive Disadvantage
Competitors offered identical items at lower prices with free, faster shipping options
Audit Approach
We conducted a comprehensive review of the brand's full advertising ecosystem:
Platform Performance
Meta Ads + Google Ads performance analysis across all campaigns and ad sets
Creative & Targeting
Creative testing strategies and audience targeting effectiveness evaluation
Conversion Analysis
Conversion paths comparison between Shop checkout and website conversions
Market Research
Competitor pricing and shipping benchmarks across the kids' products category
Key Findings
1
Pricing Misalignment
Price hikes made the brand fundamentally uncompetitive in a price-sensitive market where parents actively comparison shop
2
Channel Shift Impact
Switching fully to website conversions significantly reduced checkout volume, as Shop was previously a strong conversion driver
3
CPA Threshold Broken
With a $34 average order value, customer acquisition costs above $20 quickly eroded profit margins
Recommendations
01
Reassess Pricing Strategy
Conduct thorough pricing analysis before scaling ad spend further to ensure competitive positioning
02
Reintroduce Shop Checkout
Implement Shop checkout alongside website conversions to maximize conversion opportunities
03
Refine Campaign Structure
Focus creative testing and messaging around value proposition rather than competing solely on price
04
Explore Shipping Incentives
Implement free or faster delivery options to improve competitive positioning against rivals
The Lesson
Not all marketing failures are ad failures. Pricing, fulfillment, and operational decisions directly shape whether ad spend can succeed.
This case demonstrates that even the most sophisticated advertising strategies cannot overcome fundamental business model challenges. Success requires alignment between marketing tactics and core business operations.
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