🥗 Paid Ads vs. Organic Reach: Which Wins in 2024?

Hey there,

Welcome back for another bite to chew on.

This time, I (Ash) am taking over since Ron got his own newsletter the other day.

If you didn’t read that issue all about VAs and how they’ve helped him, it’s linked HERE.

I still handle all of this myself, so it’s time to talk on these levers I pull every day:

Organic vs. Paid Ads

We’re going to go over pros and cons of both, how I adjust things day-to-day with Obvi, and if I were starting from scratch, what I would focus on first.

It’s not a question of which one is better…

It’s more of a question of which one is better for you right now.

I’ll explain.

But first, we wanted to do something special for the next Chew On This event on April 18th in NYC…

We’re doing a giveaway to fly one person out for the event and a hotel for the night on us!

Just like THIS POST and comment why you want to come to the event to be eligible!

Now, let’s get into it.

Start with What You Need Now

We’ll start with comparing the pros and cons for both.

In terms of cost effectiveness, I think paid is obviously the least cost effective.

You have to be able to afford a high enough CAC by increasing your AOV. 

With paid, you probably drop down anywhere from breakeven to 10% profit, sound about right?

Organic is different. 

You can invest in it and one viral video can generate sales for the whole month.

The cost effectiveness of organic is definitely there, but the scalability isn't.

It’s not like every video is going to go viral..

With paid, the cost effectiveness isn't there, but the scale is. 

Scaling is only limited by how much you want to spend.

This is why you have to have both because they compliment each other. 

If I have organic doing really well, my paid is amplified. 

My paid then goes out and is amplifying how well organic does.

If you don't have organic and are solely relying on paid, and you have a bad day, then it's a really bad day. 

If you have organic going and paid is doing okay, you have a good day. 

If organic is doing really well and paid is doing really well, you have an amazing day.

You need both.

At the Mercy of Algorithms

Paid advertising is buying attention.

With paid, I can spend $30-50K whenever I want to, but will it be efficient? 

This is the question that separates truly great ad spend.

Paid will give you that scalability and maybe consistency and organic will help with efficiency.

At Obvi, we truly rely on paid because our organic isn't as great.

I'm doubling down on it this year.

We spent $700,000 in March, and it drove a lot of revenue and profit. 

The benefits for paid are there for us right now.

On the flip side if you can't achieve efficient results, then this becomes very difficult (and expensive). 

If you aren’t happy with your efficiency, look at your creatives, testing different offers and optimize your landing pages.

→ How We Build Landing Pages at Obvi ←

All those things need to be dialed in for your paid to work well. 

(if you can also nail the organic side, paid does even better)

With organic, you can put in a lot of effort and still not get anywhere. 

It’s freaking annoying.

You're at the mercy of algorithms. 

If you post a video on Instagram or TikTok and it doesn't hit, it just doesn't hit.

You're waiting for those viral moments to really have something take off.

With paid, it's difficult because you're at the mercy of, again, another algorithm. 

One day, paid performance can be great; the other, it’s sh*t. 

There's a lot of factors that need to go into paid.

It can take time to dial what I mentioned above because you have to spend money to learn and buy data to understand what's happening and make changes accordingly.

It's a long term plan.

With paid, you could burn a ton of money before you start seeing results. 

With organic, you can burn the money trying to get something to pop off and it never does. 

At the same time, you might hit something that goes viral and changes everything. 

It’s all about which burn you can stomach until it pays off, literally.

$700K?! We Can’t Do THAT

I get it, that’s a huge number to wrap your head around.

What if you’re just starting out?

Here’s how I would break down a $3,000 ad budget for both paid and organic:

If you have a target CPA of $50 when it comes to paid, you need to spend around $400 a day on Meta to get out of the learning phase. 

Meaning, you need to get 50 conversions in a 7 day window for your ads to actually be effective.

That is almost $3,000/week.

Can you afford to lose that three grand entirely? 

(that's what you have to ask yourself)

On the other hand, could you spend $3,000 seeding influencers?

Here’s what that would look like:

Say the cost of your product is $7 + shipping. Let's call it $15 bucks total. 

You can send out 200 care packages to influencers.

Assuming ~30% of them post about it, that is 60 influencers generating content.

$3,000 / 60 influencers  = $50/influencer.

Now you use that content for ads, on your website, landing pages, email, whatever it is.

At the same time, you’re generating organic visibility. 

It is just a question of what you want your ROI to be.

Do you want to play the break even vs. profit game with paid?

Or do you want the tangible content to multipurpose in different ways later with organic?

Show OR Tell

Different industries respond better to different methods.

For industries where you show and don't tell, (think apparel, makeup, beauty, etc.) 

organic ads do extremely well with social promotion and influencers.

For industries like supplements and things like that, it's a little difficult because you're telling versus showing.

There isn't a way to show immediate results. 

Paid ads would be a better way to immediately tell your story.

Ash, How Do We Go Out and Do This?

I’m so glad you asked.

If I was starting a new business today, I would focus on organic first.

Believe me, I know you’re busy, but even I have five minutes to film some kind of content.

Here are some examples right off of the top of my head:

• Why did you start the company?

• What are you doing on a day to day basis?

• What is your product supposed to solve?

• What does it do?

• What are the benefits?

• Talk about the ingredients

• Talk about the inspiration

• Manufacturing, shipping, boxing orders

• Anything day in the life

People and customers like to resonate and see how those things work.

Most brands don’t let people into that side of the business.

If you really don’t have the time, you can get part-time employees and say, “Hey, go and film content or go around the office and film what's going on on a day to day basis.” 

Just continuously film and capture everything and put it out there. 

Build in public.

At the end of the day, it's about numbers. 

How much can you put out there and share to strike the delicate balance between quality and quantity?

If you're starting off small, use a customer service representative exactly like we did with Obvi when we were first starting.

Where to Post and Focus

TikTok can be hit or miss, but when it goes viral, it really goes viral.

Instagram gets a lot of views, but less intent minded people.

If something gets a million views on Instagram, the intent from those million views isn't as impactful as it is for TikTok.

This is something that we're seeing, so it could be different for you. 

We see YouTube shorts as a big opportunity.

We haven't cracked it, yet. We’d love to hear ideas or strategies working on that end!

We're basically repurposing all of our content everywhere and seeing how things go.

For right now, Instagram, Reels and TikTok are where we should be, and YouTube Shorts is where we should also go.

Tool of the Week

Managing influencers is like herding cats.

Every step, from reaching out to keeping everything organized, used to be a massive headache. 

If you’re still figuring out the balance of organic and paid ads for your brand, you could be burning cash at an insane rate if you do it wrong..

Instead of managing it all yourself, use SARAL. 

This tool has seriously been a lifesaver for us. 

It's like having a super-organized assistant who knows exactly what you need before you even ask. 

Now, keeping track of collaborations is a breeze, and it feels less like chasing cats and more like we're building real connections with our influencers. 

If you've been on the struggle bus with influencer marketing, SARAL might just be the stop you need to get off at. 

Claim access to a 7-day free trial HERE.

(look at that new website too!) #proudpartner

The Latest Soundbite

This Chew On This podcast episode is a little different, but that’s why we love it.

Ash and Ankit dive into a TON of trends going on in the world, comparing and contrasting them to all things COT, Obvi, Coffee Over Cardio, you name it.

Just like we’ve compared and contrasted organic vs. paid here, it’s supposed to get you thinking.

Go see what they’re saying in the link below!

Hungry for More?

Make sure your calendars are free next Thursday, April 18th and meet us at 48 LOUNGE here in the city at 6:00 pm.

We’d love to continue the organic vs. paid debate over drinks, great food and with even greater minds running 8-9 figure businesses.

RSVP so you can share what’s been working for you and your brand!

Don’t forget to enter the giveaway to come to the event, ALL EXPENSES PAID, in THIS POST! 

Thanks for Reading Along

Organic vs. Paid all comes down to your blended goal and understanding how your ad account reacts. 

Hopefully, my rambling made some sort of sense.

I love this stuff and my mind is always going a million miles an hour over it.

At the end of the day, set your goal.

If you're hitting it, great. 

If you're not, adjust where you need to pick up slack.

Obviously, I’ve preached that you need both organic and paid. 

I would never do without either one of them.

My foot is always on pedal for both, but it depends on how much gas I’m giving each one. 

Ask yourself these questions and then adjust your own strategy accordingly:

How do you continuously get visibility?

How do you get more views and impressions for your brand while maintaining a low CPM?

The balance is based off of what your end result is and pinpointing which lever needs to be pulled on more at any given time.

All the best,

Ron & Ash