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Understanding how ads fundamentally work and identifying the real metrics that drive business success is critical in today’s competitive ecommerce landscape. JJ Reynolds, founder of Vision Labs, shares invaluable knowledge gained from years of hands-on experience with companies ranging from startups to nine-figure enterprises. His approach to data measurement, creating a single source of truth, and iterative testing offers a blueprint for marketers and business owners looking to maximize their advertising ROI.
This article distills JJ’s expertise into seven core insights that will help you navigate the complexities of ads metrics, avoid common pitfalls, and build a data-driven marketing strategy that actually works.
1. Embrace Iteration Over One-Time Testing to Discover Your Single Source of Truth
One of the foundational principles JJ emphasizes is that a “truth passes through three stages: first, it is ridiculed; second, it is violently opposed; third, it is accepted as self-evident.” This perfectly captures the experience businesses face when testing new marketing strategies or ad campaigns.
Rather than expecting one definitive A/B test to deliver all the answers, JJ encourages a mindset of continuous iteration. He explains:
“Look at the numbers, do something based off of the numbers, and then keep going. Not all the time can you run a true test that’s like A versus B. Like, you kind of have to keep moving in a direction.”
He highlights the importance of moving with velocity in one direction, allowing for small course corrections instead of erratic pivots. This approach helps build momentum, making your data more reliable over time and your marketing more predictable.
Why is iteration so crucial? Because the internet marketing landscape is dynamic. What worked last week may not work this week, and the data you gather should be continually refined to adapt. By consistently analyzing your performance data and adjusting your approach, you develop a more accurate single source of truth for your ads metrics.
2. Understand the Auction-Based Nature of Advertising Platforms
At the core of most major advertising platforms like Google Ads, Facebook (Meta), and others is an auction system. JJ breaks down this concept in a straightforward way:
“An ad market is an auction structure, meaning that you’re bidding money at every hour of the day for every user on that platform.”
This means that advertisers compete continuously, bidding for ad space in real-time. The highest bidder for a particular user and time slot wins the placement. However, the bid doesn’t guarantee success — the quality of the ad, user engagement, and platform algorithms also play roles.
JJ uses an auction analogy:
“If you went to an actual auction house to buy a cow, you might bid $20 and someone else bids $25, so $29 wins. But tomorrow, if fewer bidders show up, you could win with a $15 bid.”
This explains why ad costs fluctuate and why it’s essential to understand that platforms are incentivized to maximize your spend while maintaining high throughput. They want you to spend as much as possible against competitors, but you’re often bidding for limited “real estate” — ad space that isn’t infinite.
Recognizing this auction-based model helps marketers make smarter bidding decisions and sets realistic expectations about cost fluctuations.
3. Avoid Getting Lost in Unnecessary Data — Focus on What Matters
JJ points out a common problem marketers face: overwhelming dashboards packed with confusing or irrelevant data. He recalls the early days of Facebook’s Business Suite and Google Ads, where the abundance of metrics made it hard to know which numbers truly mattered.
He advises against looking at metrics in isolation:
“Most people try to look at one metric in isolation like click-through rate, but it changes based on your strategy. For example, a 20-minute video ad with a ‘Book a Call’ button might have a low click-through rate but a high conversion rate.”
Instead, JJ recommends starting with high-level metrics that measure overall efficiency, such as the Marketing Efficiency Ratio (MER):
- MER = Total Revenue ÷ Total Spend
This ratio gives a clear picture of how much revenue you generate for every dollar spent on marketing. For instance, if you make $1,000 in revenue from a $500 ad spend, your MER is 2:1.
From there, you can break down the MER by acquisition channels, customer segments, or platforms to understand which strategies are truly driving profit.
JJ cautions that metrics like Customer Acquisition Cost (CAC) are useful but need to be contextualized with revenue data to determine if the cost is justifiable.
4. Recognize Platform Spend Trends: Facebook Dominates but TikTok and Others Are Emerging
When it comes to ad spend distribution, JJ shares insights based on managing tens of millions in advertising budgets:
- For ecommerce: Approximately 50–70% of spend goes to Facebook and Instagram (Meta platforms), 20–30% to Google Ads, and 10–20% across other platforms.
- For B2B: Spend is usually split between Google and LinkedIn, often around 50/50, depending on the client’s creative approach.
Despite rumors that “Facebook is dead,” JJ confirms that Facebook’s algorithm remains one of the best for acquiring new customers, especially for direct-to-consumer brands. The combination of Facebook and Instagram allows advertisers to reach a wide demographic spectrum effectively.
While TikTok is gaining some market share, JJ notes it hasn’t yet reached a level where it commands a significant portion of ad budgets for most clients. Similarly, Twitter (now X) remains more of a platform for engagement and conversation than a strong client acquisition channel.
5. Measure Brand Effectiveness Through a Simple Funnel Framework
Branding is often overlooked or misunderstood in terms of measurement, but JJ offers a straightforward way to quantify its impact using what he calls the “brand funnel.” This funnel tracks user progression from awareness to action without worrying about complex attribution models:
- Total Impressions Off-Site: The number of times your brand appears on platforms like Facebook, LinkedIn, or Instagram.
- Site Visitors: The total number of people who visit your website.
- Offer Page Views: Visitors who reach key pages like product detail pages (PDP) or contact forms.
- Initiated Effort: Actions such as adding items to cart, beginning checkout, or clicking through to pricing.
- Completed Action: Final conversions, such as purchases, subscriptions, or booked sales calls.
By tracking these stages, you can diagnose where your branding or marketing may be underperforming. For example, a large number of impressions but few offer page views might indicate weak brand messaging or ineffective ad creative.
JJ shares a success story where a client used this approach to optimize an old-school direct response funnel involving lead magnets and tripwires. Through iterative tweaks informed by data, they went from losing money daily to generating thousands of leads profitably.
6. Develop a Customized Strategy and Avoid Copy-Pasting Funnels
Many marketers fall into the trap of copying someone else’s funnel or ad strategy, hoping to replicate their success. JJ warns against this:
“It might work for some cases, but it will not generate the same results. You just can’t copy it.”
He explains that even if you are selling the exact same product, differences in brand strength, market positioning, and customer behavior mean your funnel will behave differently.
JJ cites the example of a major influencer like Gary Vaynerchuk, who can sell a poorly designed product landing page purely because of his brand. Most businesses don’t have that luxury and must focus on their unique offers and brand stories.
The key takeaway: know your numbers, understand your strategy, and implement consistently with your own data-driven insights, rather than blindly copying others.
7. Build a Single Source of Truth While Accepting Imperfections in Data
Creating a single source of truth for your ads metrics is notoriously difficult because every platform has its own definitions and tracking quirks. JJ explains this challenge with a Google Analytics example:
“A user is technically a device. So if I email you a link and you open it on your phone and later on your laptop, Google Analytics counts that as two users.”
This device-based counting means your data will never be 100% accurate. The solution is to accept some level of imperfection but focus on consistent trends and patterns.
JJ likens it to weather forecasting:
“If the forecast says 78 degrees and your thermometer reads 76, that’s close enough. The important thing is that the pattern of temperature changes is consistent.”
He stresses that many attribution tools “make numbers up” to fill in gaps, so you must use data as directional guidance rather than absolute truth. The value lies in monitoring trends over time and making decisions based on those patterns.
To operationalize this, JJ recommends starting with simple, actionable questions about your data and layering complexity as you grow more comfortable. Always ask: what action will I take based on this information?
Final Recommendations
Mastering ads metrics requires more than just tracking vanity numbers or blindly following trends. It demands a strategic, iterative approach grounded in understanding how advertising platforms operate and how your unique business fits into that ecosystem. JJ Reynolds’ insights remind us that the path to marketing success is paved with continuous learning, asking the right questions, and building a reliable single source of truth—even if that truth is imperfect.
By focusing on meaningful metrics like the Marketing Efficiency Ratio, embracing the auction nature of platforms, and measuring brand impact through a clear funnel, you can make smarter decisions, optimize your ad spend, and ultimately grow your business sustainably.
Remember, speed and velocity in action matter just as much as the data itself. Move fast, adjust often, and let your numbers guide you toward better outcomes.
For those looking to deepen their measurement capabilities, consider building bespoke systems that match your unique strategy and goals, rather than relying solely on off-the-shelf tools. The combination of technology, human insight, and a clear vision is where true growth happens.
Watch the full podcast here: How Ads fundamentally work & the real metrics businesses need | JJ Reynolds | The DoneMaker Podcast
FAQ’s (frequently Asked Questions)
MER is the ratio of total revenue to total marketing spend. It helps you understand how effectively your marketing dollars are being converted into revenue. A higher MER means better efficiency.
Metrics like click-through rate depend heavily on your ad format and strategy. For example, long video ads may have low click-through rates but high conversion rates. Always consider multiple metrics in context.
Use a brand funnel approach tracking impressions, site visits, offer page views, initiated efforts (like add-to-cart), and completed actions. This helps identify where your brand is losing potential customers
No. Every business has a unique brand, audience, and strategy. Copying funnels without understanding your own data and strategy often leads to poor results.
Accept that no data is perfectly accurate. Focus on trends and patterns over time rather than absolute numbers. Create a single source of truth for your key metrics to maintain consistency.
