Why a Profitable Small Ad Campaign May Collapse When Scaled
Do describes paid campaigns that worked at low spend but became uneconomic as more money was added. The experience challenges the assumption that a positive small test can be expanded linearly without customer-acquisition costs changing.
- Acquisition costs can rise sharply with increased spend
- A small profitable campaign does not guarantee scalable economics
- Customer discounts may sometimes create more value than excessive ad spend
- Scale decisions should follow marginal acquisition cost
“As soon as we put more money into it, it just goes upside down.”
“So instead of spending a dollar to acquire a customer, and now it's like $12 and it's like at some point it makes no sense…”