the Ecom Handbook

Mark Cuban, entrepreneur and philanthropist.

Hey, it’s Jochem. Welcome back to the Ecom Handbook #12.

Quick question: is there anything I can do better with these newsletters?
Just hit reply and tell me. I read every message and it directly shapes what I write next, my goal is to make each edition more useful than the last to help you grow your online store with actionable tips.

-Jochem (@iamjochems)

There’s a quiet pattern I keep seeing.

Smart operators, strong brands, with solid budgets. Still frustrated with performance.

Not because automation doesn’t work.
But because they’re still trying to outmaneuver it.

Algorithmic ads aren’t tools you control, they’re systems you collaborate with. And collaboration requires a different posture.

Let’s break down how to actually work with them.

THE SHIFT
THE BIG IDEA

“You don’t “optimize” algorithmic campaigns.

You condition them.”

Previous mindset:

  • Adjust bids

  • Tweak audiences

  • Duplicate winners

  • React daily

New mindset:

  • Shape incentives

  • Feed signals

  • Control constraints

  • Judge system outputs

Advantage+, PMAX, auto-bidding stacks, they are prediction engines. They answer one question repeatedly:

Given these signals, where is the highest probability of value?

Your job is not to micromanage the answer. It’s your job is to design the environment the answer emerges from.

That’s a very different skill.

THE IMPACT
WHY IT MATTERS

1. Constraints > Control

Algorithms operate within boundaries.

Budget caps.
Conversion goals.
Event priorities.
Geographic scope.
Creative pool.

If results are unstable, it’s often because constraints are unclear.

Example:

  • Optimizing for purchases

  • But feeding low-margin SKUs

  • While measuring success on platform ROAS

  • And scaling based on 3-day performance

The machine isn’t wrong. It’s maximizing what you defined. Clarity of constraints determines clarity of output.

2. Volume Feeds Intelligence

Algorithmic systems need density.

Too many campaigns = diluted data.
Too many goals = diluted learning.
Too many exclusions = restricted exploration.

Consolidation isn’t laziness, it’s fuel.

If you want better performance:

  • Merge fragmentation.

  • Centralize budgets.

  • Let learning compound.

3. Stability Beats Constant Intervention

Every major edit resets learning.

Budget spikes.
Creative swaps.
Event changes.
Structure rebuilds.

If you constantly “improve,” you constantly destabilize.

Working with algorithmic ads means:

  • Making fewer, higher-leverage changes

  • Waiting long enough to judge signal direction

  • Separating noise from structural shifts

The machine needs space to converge.

4. Evaluation Must Mature

Platform ROAS is an output.
Not a strategy.

Algorithmic campaigns can look volatile inside the ad manager, zoom out.

Look at:

  • MER (blended revenue / total ad spend)

  • Contribution margin

  • New customer acquisition cost

  • Cohort payback

When automation works, it improves the system.

Not always the screenshot.

THE MOVE
WHAT TO DO NEXT

Instead of another checklist, here’s something different.

Run an Algorithm Alignment Audit, but not inside your ad account. Run it in your leadership team.

Ask these 5 questions in one meeting:

  1. What is the single economic goal this account should optimize for?
    Revenue?
    Margin?
    New customers?
    LTV?

    If five people give five answers, your algorithm is confused before it starts.

  2. What are we willing to tolerate?
    Higher CAC for new customers?
    Short-term ROAS dips for scale?
    Volatility during testing?

    Automation punishes unclear risk tolerance.

  3. Where do we actually believe growth comes from?
    More spend?
    Better creative?
    Better offer?
    Better retention?

    If the belief is wrong, the constraints will be wrong.

  4. Are we optimizing for the ad account — or the business?
    Many teams subconsciously optimize for dashboards.
    Fewer optimize for enterprise value.

  5. What would “working” look like six months from now?
    Stable CAC?
    30% higher spend?
    Improved blended margin?

    Define the destination before judging the vehicle.

Then, and only then, adjust the ad account. Because most performance instability isn’t algorithm failure, it’s strategic ambiguity.

Automation amplifies clarity, it also amplifies confusion.

THE ASSIST
WHERE AI FITS

Before restructuring campaigns, use AI to pressure-test your logic.

Prompt:

“Act as a growth CFO and performance lead. Based on this revenue, margin, CAC, and LTV data, define the correct optimization goal for algorithmic campaigns. Highlight misalignment risks and constraint improvements.”

Paste:

  • Monthly revenue

  • Gross margin

  • Current CAC

  • AOV

  • % new vs returning

  • Target growth rate

If the answer exposes trade-offs you hadn’t articulated internally,
that’s leverage.

AI is strong at modeling consequences, use it before you move money.

THE STACK
TOOLS WORTH KNOWING

1. Feedonomics - Product feed optimization for Google and retail media
https://feedonomics.com/

PMAX performance is heavily influenced by feed structure.
Clean titles, attributes, and segmentation materially impact allocation.

2. Haus - Geo-based incrementality testing
https://www.haus.io/

When automation scales, incrementality questions grow.
Geo testing helps validate true lift beyond platform reporting.

THE NEWS
THIS WEEK IN E-COMMERCE

AI‑driven search urgency for Shopify brands

A digital marketing agency warns that ecommerce merchants (especially on Shopify) need to adapt to AI‑powered search and recommendation systems to maintain visibility.

Shein banned on university devices

The University of Texas at Austin has banned access to Shein and certain other Chinese‑owned e‑commerce apps/sites on institutional devices and Wi‑Fi as part of compliance with state directives.

Mailchimp upgrades boost e-commerce marketing

Intuit rolled out major enhancements to Mailchimp designed to expand e-commerce marketing automation and analytics capabilities for sellers worldwide.

THE FIX
YOUR ACTION STEP

After reading this edition of the newsletter, write one page.

Not in your ad account.
On paper.

Title it:

“How Our Algorithm Wins.”

Answer, in plain language:

• What economic outcome are we optimizing for?

• What trade-offs are we explicitly willing to accept?

• What signals matter most?

• What does success look like in 6 months?

• What will we ignore, even if it creates short-term noise?

If this isn’t documented,
your automation is operating on assumptions.

And assumptions create volatility.

Once it’s written:

• Share it with your leadership team.

• Align on it.

• Then check your campaigns against it.

If the constraints match the strategy, keep them. If they don’t, fix the inputs, not the algorithm.

Because the edge in algorithmic advertising isn’t better button pushing. It’s clearer thinking, and clearer thinking compounds.

If you have any comments or feedback, just reply to this email!

Thanks for reading,
Jochem

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