Lose Money to Scale Faster
đ„ Why You Should Run âMoney-Losingâ Campaigns on Purpose, Google Expands Ad Dominance With Triple-Serving & YouTube Shorts Creator, and more!
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In this newsletter, youâll find:
đ„ The Paradox of âLosing Moneyâ to Scale Faster
đ Google Expands Ad Dominance With Triple-Serving & YouTube Shorts Creator Partnerships
đ Ad of the Day
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đ„ The Paradox of âLosing Moneyâ to Scale Faster
Most brands treat advertising like a simple equationâspend money, get sales, repeat. If ROAS drops, panic sets in. Budgets get slashed. Growth stalls.
The best brands donât play that game. Instead of optimizing every campaign for short-term profit, they deliberately run ads that lose money upfront because they know these campaigns fuel exponential growth in ways most brands overlook.
Hereâs why the smartest brands embrace âlosingâ to win big.
Why Some Campaigns Must Lose Money (But Still Make You Rich)
1ïžâŁ Ads That Buy Attention, Not Just Clicks
Most brands push direct-response ads to cold audiences, expecting immediate conversions. Thatâs like asking a stranger to marry you on the first date. It rarely works.
Instead, elite brands run low-cost, high-reach campaigns to create familiarity before pushing for a sale. This primes their audience, making future conversions cheaper and easier.
The best direct-response brands spend on non-converting ads first to lower CAC over time.
Nike spends millions on campaigns with no CTA because brand equity makes their sales campaigns unstoppable.
DTC brands run engaging quizzes, story-driven videos, and viral content to build trust before making the sale.
Skipping this step forces brands to spend more on acquisition later.
2ïžâŁ The Psychological âAnchoringâ Play That Lowers Future Ad Costs
Apple, Tesla, and Rolex never compete on discounts. They train consumers to see their products as premium before they even consider buying.
Smart brands use ads not just to sell but to shape how their products are perceived.
A supplement brand ran ads calling its formula âThe Ferrari of Protein Powdersâ months before running conversion ads. CAC dropped 34% once customers saw them as the premium choice.
A skincare brand spent months running ads highlighting dermatologist-backed research before switching to sales-driven ads. Once they did, conversion rates shot up.
By engineering desirability first, these brands avoided price wars and trained customers to choose them even at higher prices.
3ïžâŁ The âLoss Leaderâ That Trains Meta to Find Your Best Buyers
Most brands optimize for cheap conversions, but that teaches Metaâs algorithm to target the wrong customersâbargain hunters who donât return.
Instead, smart brands run loss-leader campaigns that teach Meta to find high-LTV customers.
A beverage brand ran ads at a slight loss on single-item purchases but aggressively upsold bundles post-purchase. Their LTV tripled while CAC dropped 40%.
An apparel brand sold hoodies at break-even but collected thousands of customers they later retargeted for higher-margin items.
Your first sale isnât your profit pointâitâs your data collection point.
The âLossâ That Pays Off in Millions
Short-term ROAS obsession is a trap. The brands that scale the fastest run money-losing campaigns strategically, knowing they are stacking long-term advantages.
When youâre playing to win the market, short-term losses arenât failuresâtheyâre investments in future dominance.
đ Google Expands Ad Dominance With Triple-Serving & YouTube Shorts Creator Partnerships
Insights from SEL and SER
Google is making major moves in ad visibility and creator-driven content, with triple-serving ads on search results and a new Creator Partnerships feature for YouTube Shorts ads.
The Breakdown:
Triple-Serving Ads on SERPs - Google now allows the same ad to appear three times on a single search pageâat the top, local pack, and bottom. This follows Google's policy update, raising concerns about competition, ad costs, and fairness in ad auctions.
Strange Auction Insights Metrics - Marketers report over 100% top-of-page and absolute top-of-page rates, hinting at potential shifts in Googleâs ad-serving algorithm. This could make dominating search results more expensive for advertisers.
YouTube Shorts Creator Partnerships Beta - Google Ads is testing a feature where advertisers can discover and promote Shorts videos featuring their brand. Powered by BrandConnect, this tool enhances UGC-driven advertising.
New Google Ads Integration for Creator Partnerships - Once enabled, Creator Partnerships appear in the Tools section of Google Ads, allowing brands to link directly to creator-made Shorts for ad campaigns. Currently, itâs invite-only, but it could reshape influencer marketing on YouTube.
Google is making ads more visible and creator-driven, blending PPC with influencer-powered content. Advertisers need to adapt, as these changes could impact competition, costs, and marketing strategies across search and video platforms
đ Ad of the Day
What Works:
The ad cleverly ties into KitKatâs classic âHave a breakâ slogan by positioning AI as the creative force behind it, implying that even advertisers took a break.
The strong red background maintains KitKatâs signature branding, while the split-screen approach effectively contrasts human vs. AI elements, making the ad visually engaging without clutter.
The phrase âAI made this ad so we could have a breakâ is both self-aware and humorous, appealing to a digitally savvy audience. It keeps the message lighthearted while reinforcing the productâs association with relaxation.
Broader Insights:
By integrating AI into the campaign, KitKat taps into tech-forward branding, which resonates with younger, digital-native consumers.
The ad speaks to Gen Z and Millennials who are accustomed to AI-driven experiences. The casual tone and meme-like phrasing make it more relatable to modern internet culture, increasing its shareability.
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