What do I get out of ad optimization and ad testing?

What do I get out of ad optimization and ad testing?

An example of ad testing and ad optimization.

Let´s play with the idea of using DKK 50,000.00 on a campaign with 2 million exposures to CPM 25 (DKK 25.00 per 1000 impressions). You have a CTR (Click Through Rate) of 0.001% on your ads, giving you 2000 clicks or 2000 visitors to your website.

If you use 5% of your budget, in this case DKK 2500 to test your ads with an ad testing, so you may increase the response by 25% by identifying the messages in the ad that gives you more clicks. 25% more clicks means you get 500 more visitors for the same budget in the same campaign.

Outcome of ad optimization.

The result of this ad optimization means that you pay DKK 12,500.00 more for advertising on a campaign without ad optimization, to achieve the same result as in a campaign which is ad-optimized.

2,500 clicks / visitors to your site without ad optimization cost you DKK 62,500.00 (DKK 50,000.00 + 25% extra in ad budget)

2,500 clicks / visitors to your website with ad optimization cost you DKK 52,500.00 (DKK 50,000.00 + 5% of ad optimization)

You can also get 25% more traffic from your campaigns for the same ad budget.

In other words, would this ad optimization give you an additional 500 more potential customers for the original budget of DKK 50,000.00 and you have saved DKK 10,000.00