How to Increase ROAS with the Same Budget for Shopee, Lazada, and TikTok Ads

Increasing your Return on Ad Spend (ROAS) for Shopee Ads, Lazada Ads, and TikTok Ads can be quite a challenge. Many factors influence whether your ROAS is high or low. It becomes even more difficult when you have to work with a fixed advertising budget.

From our experience at Digital Break Time, we’ve tested and experimented with various methods. We’ve found that there are specific principles you can follow to successfully boost your ROAS on these platforms, even without increasing your ad spend. Here’s a breakdown of the key strategies.

1. Increase Target ROAS, but Only for Your Bestselling Products

Adjusting your Target ROAS is the first thing you should try because it can significantly improve your returns. However, you need to understand what happens when you raise your Target ROAS. Essentially, you’re telling the ad system you have higher expectations for your return. The system will then lower its bids per click and become more selective about who sees your ad.

This often leads to fewer clicks and a lower ad ranking. That’s why we strongly recommend applying this strategy only to products that are already selling very well. Popular products that customers are actively searching for will be less affected by the drop in visibility but will benefit from the improved ROAS.

How to do it: Start by increasing the Target ROAS by a small amount, around 10% to 30%, and monitor the results before making further adjustments.

A word of caution: If you apply a higher Target ROAS to products that don’t sell well, you risk making them sell even less, or not at all. So, choose your products wisely.

2. Reallocate Your Budget to High-Performing SKUs

Even with a fixed budget, how you allocate it is crucial. Reallocating your budget means deciding which products deserve more attention. We understand that sometimes you need to push promotional items or clear out old stock.

However, when your primary goal is to increase ROAS, you must shift your budget towards products that already have a high ROAS. The strong performance of these products will pull up the overall average ROAS of your entire store. You can still run ads for lower-performing products, but just assign them a smaller portion of the budget. You might even find that by spending less on low-ROAS items, their individual ROAS improves because the cost goes down while sales remain steady.

3. Group Products by ROAS Performance and Prioritize Budgets

For ad types like TikTok’s GMV Max campaigns or Lazada’s Sponsored Discovery, where you group products into campaigns, this method works very well. It’s similar to the previous strategy but more structured.

How to do it: Create separate campaigns for your products based on their ROAS performance: High, Medium, and Low. (You’ll need some historical ad data to know which products fall into which group). Then, allocate your budget according to their importance. For example, you could use a 70:20:10 split, dedicating 70% of your budget to the high-ROAS campaign, 20% to the medium, and 10% to the low. This focus on high-ROAS products will naturally lift your overall store’s ROAS. You can always adjust these percentages based on performance.

4. Shift Your Budget to Platforms with Better ROAS

If you have the authority to decide where your total advertising budget goes, moving money between platforms is a powerful and effective strategy.

When your main goal is maximizing ROAS with a fixed budget, you should regularly review your monthly performance data. Identify which platform (Shopee, Lazada, or TikTok) gives you the highest ROAS. Then, simply move a portion of the budget from the lowest-performing platform to the highest-performing one. This simple shift can significantly improve your overall advertising results.

This can be difficult for agencies that only manage one platform for a client or for marketers in large companies where budgets are rigidly fixed for specific product lines and platforms.

5. Manage Your Affiliate Program Effectively to Control ROAS

Finally, don’t overlook your platform’s built-in affiliate marketing program. Affiliate marketing is the one area where you have nearly 100% control over your ROAS. This is because you pay commissions as a percentage of sales.

If you set a reasonable commission rate, your affiliate program can be a great tool to pull up your average ROAS. However, there’s a trade-off. A low commission rate means a very high ROAS, but it might not attract many creators, leading to lower sales (GMV) from the affiliate channel. On the other hand, a higher commission will lower your ROAS but can significantly motivate creators, leading to a substantial increase in sales.

Conclusion: How to Increase ROAS on a Fixed Budget

Working with a fixed budget is challenging, but not impossible. The two most critical strategies are adjusting your Target ROAS for top products and reallocating your budget to focus on what already works. By doing this, you can increase your sales without spending more money.

Remember that there’s a limit to how much you can increase ROAS, and performance will vary across different products. The best approach is to apply the methods in this article, test them, and compare your results month by month to find the perfect Shopee Ads Strategy for your business.

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Originally in Thai. Translated to English with the help of Gemini.