Advertising is a crucial cog of the machinery of commerce. When it comes to e-commerce businesses, the options for marketing and advertising are many. An e-commerce business owner has to strike a balance between spending and saving money on advertising. Advertisements are an obvious need for expanding your brand visibility and leads for your business. However, it is financially not advised to run advertisements all the time. The decision to run an advertisement campaign should take multiple factors into consideration.

Few Factors To Mull Over Before Running An Advertisement  

The decision of running an advertisement should depend on what you want to achieve with the advertisement. “How big is your consumer base? What is your target audience segment?” are questions that you should answer before finalizing an advertisement campaign. 

When Should You Spend Advertising Dollars On Your E-commerce Brand

Here are a few factors to mull over before running an advertisement  

How much does it cost to gain a new customer? 

When running an advertisement campaign, you have to think about how much it costs to gain a customer. This means you take up the existing costs of marketing and advertising. This helps brands in understanding their present costs and if the costs can increase or decrease. Sometimes, it may cost you less to gain customers, but in the end, you may not retain them. In such cases, you need advertisement campaigns that help boost customer retention and loyalty. 

This makes the purpose of launching an advertisement campaign. Most of the established companies run advertisement campaigns to retain customers and convert first-time buyers. Periodical analysis of how much the brand spends on advertisement campaigns gives the owner a view of possible improvements in the budget. 

How much is a new customer worth? 

Every e-commerce business is dependent on its customers. Thus, customer acquisition by advertisement is important to every e-commerce business. However, the value that a new customer brings to the brand differs from business to business. The value that a customer brings in for a brand depends on the volume of sales generated through each customer. 

Does your business want to generate business through a chain of new customers triggered by an old one, or it wants to acquire new customers from scratch determine the nature of the advertisement campaign? The advertisement campaign budget and concept fluctuate with the goals of customer acquisition for the brand. 

If one customer does not bring in a lot of value to the brand, the advertisement costs run low. If the acquisition of one customer adds significant value, the ad campaign tends to be on the expensive side. For established businesses, the value brought in from new customers may be equal to already existing customers. In such a situation, the budget of an advertisement campaign is balanced with revenue. For new businesses, customer acquisition is the main goal and adds a lot of value to the brand. Such businesses go all out on customer acquisition advertisements. 

For new product lines launched by businesses, customer acquisition advertisements also matter a lot. New product lines also need a proper introduction to the market so that the hype is high. Based on the hype for the product, customer inflow levels go up. Therefore, an e-commerce business needs to run advertisement campaigns at different points of time depending on product demand and customer movement. 

How much can the brand afford? 

The scale and image of a brand determine how much a brand spends on the promotion of products. The financial scale and funding of a business determine how much it can spend on its advertising campaigns. The goal is not to overspend on advertisement campaigns but achieve the marketing goals on a limited budget. Even large-scale brands have a budget, and successful e-commerce businesses maximize their impact within a budget. 


The scale of advertisement campaigns can fluctuate from small to large depending on the goals and budget of the entire initiative. Every e-commerce brand needs an advertising strategy for the proper marketing of products.