Sample eCommerce Audit & Strategy
Audit 1. Getting familiar with the ad account 1.1. Overview [confidential] is operating on the global market and sells high-quality mobile phone cases and accessories. The Ad account has more than 1500 campaigns, 40 of which are currently active. Average ad spend on a monthly basis is $90-100K. Currently the ad account has overall 1.89 ROAS, spending $3.5m generating revenue of $6.5m. The pixel is installed and tracked 208k purchases. 1.2. Labeling The account has a labeling system but it’s hard to be understood. There are a few main tags (IS, SA, NTN) and a lot of identifiers. It looks like there is no strategy of labeling the ad account which makes it hard to evaluate previous work done (hard, not impossible). Most of the campaigns have the product promoted in their name and some have the objective of the campaign. Campaign tags - IS, SA, NTN, Optimize, YS. Those tags are either the labeling system of different agencies that have work with the ad account or the client’s own labeling system. Product name – in most of the campaigns names there is a product stated which shows makes it easier to digest the data.
Objective – some of the campaigns have the objective in their name. However, this is not a consistent identifier so we can’t rely on it to track data. Geo targeting – in some of the campaigns there is a location stated, countries most of the time, for example: US, CA, UK.
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Audit The identifiers stated above can help us dissect the data, allowing us to better understand the ad account and the work that has been done. However, we need to set-up a strict labeling system to help us manage the ad account. This can benefit the account performance the following ways: Better time management; Better evaluation of the current and past state of the campaigns; Helping the client to better understand what is happening in the ad account; Easier auditing and reporting; Structuring the account in a way that allow us to locate and isolate poor performing ad sets and ads, while keeping the winning ones unharmed.
We would also need to create a preset to be able to evaluate the performance of the campaigns on different levels. The preset is named “gen_opt” and includes: Reach
Cost per Website Content Views
Impressions
Website Add to Baskets
Frequency
Cost per Website Add to Basket
CPM
Checkout Initiated
Clicks (All)
Cost per Checkout Initiated
Link Clicks
Website Purchases
Unique Link Clicks
Cost per Website Purchase
CTR (All)
ROAS
CTR (Link-click Through Rate)
Amount Spent
CPC
Budget
Website Content Views
The preset will give us information about targeting, creative performance, events tracked and the campaign performance. 1.3. Overall account performance The current state of the account is evaluated based comparing the lifetime performance of the ad account compared to the performance in the past 30 days. 3
Audit Table 1 – [confidential] Ad Account Data 9/15/18 Stats/Time frame Reach Impressions Frequency CPM Clicks (All) Link Clicks Unique Link Clicks CTR (All) CTR (Link-click Through Rate) CPC VC Cost per VC ATC Cost per ATC IC Cost per IC Purchases Cost per Purchase ROAS
30 Days 5,230,536 15,844,322 3.03 $6.23 306,688 252,549 179,072 1.94% 1.59% $0.39 496,107 $0.18 22,287 $4.43 9,259 $10.67 4,913 $20.10 1.89
Lifetime 763,181,473
$4.54 19,018,954 14,775,485 8,458,795 2.49% 1.94% $0.23 15,649,648 $0.19 808,673 $4.28 299,247 $11.56 208,896 $16.56 1.89
Table 2 – Data Evaluation
Comparison/Time Frame Reach to Impression Ratio Clicks (All) vs Link Clicks CTR (All) vs CTR Link Clicks to VC Conv. Value Link Clicks to ATC Conv. Value VC to ATC Conv. Value ATC to IC Conv. Value ATC to Purchase Conv. Value IC to Purchase Conv. Value Link Clicks to Purchase Conv. Value
30 Days 33% 17.66% 18.05% 1.96 times 8.82% 4.49% 41.54% 22% 53% 1.94%
Lifetime 32.83% 22.09% 1.06 times 5.47% 5.17% 37% 25.83% 69.80% 1.41%
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Audit Data evaluation: Lifetime The lifetime data of the account shows that ROAS is 1.89, while the average conversion rate of the ads is 1.41%. While we are not able to track the reach to impression ratio we are able to track the performance of the ads comparing the Clicks (All) vs Link Clicks metric (32.83%) and CTR (All) vs CTR metrics (22.09%), which is good. The metrics shows that the difference between the compared metrics is less than 2 times which means that people are not only clicking on the ad (for example watching the video or engaging with likes, shares and comments) but are showing the intent to leave the platform and visit the website. This is an indicator showing that the ad elements (copy, creative and CTA) are made to fit the targeted audience. Evaluating the performance of the account further we can see that the conversion values between events. The overall conversion rates are as follows: ďƒŚ 5.47% of people landed on the website are adding products to their baskets ďƒŚ 37% of people who have added a product to their baskets are triggering the Initiate Checkout event by landing on the checkout page ďƒŚ 69.80% of people who have initiate the checkout event are actually purchasing a product
This data is showing that after adding a product to their cart there is a big chance to end up placing an order. The IC to Purchase conversion value is high which shows that the checkout page is easy to navigate and optimized for conversions. To optimize the campaign for more conversion we should focus improving the top of funnel, increasing the ATC, while minimizing the cost per landing page views. The conversion value of the ads (link clicks to purchase conv. Value) is 1.41% can be improved to up to 2% which is expected to increase the conversions by 25%. The indicator also show us that although the ads are reaching relevant potential customers they are not targeted enough. Improving the audiences will result in more conversions at lower cost.
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Audit 30 Day The data from the past 30 days in the account shows that ROAS is 1.89, while the average conversion rate of the ads is 1.94%. In the past 30 days the “Impressions to Reach” ratio is 33%, meaning that a link click happens on every 3 views of an ad. This indicator shows that the ads can be improved by improving the ads, showing creatives with higher contrast to standout more. We are also able to track the performance of the ads comparing the Clicks (All) vs Link Clicks metric (17.66%) and CTR (All) vs CTR metrics (18.05%), which is good. The metrics shows that the difference between the compared metrics is less than 2 times which means that people are not only clicking on the ad (for example watching the video or engaging with likes, shares and comments) but are showing the intent to leave the platform and visit the website. This is an indicator showing that the ad elements (copy, creative and CTA) are made to fit the targeted audience. Evaluating the data further we can see that the conversion values between events. The overall conversion rates are as follows: 8.82% of people landed on the website are adding products to their baskets 41.54% of people who have added a product to their baskets are triggering the Initiate Checkout event by landing on the checkout page 53% of people who have initiate the checkout event are actually purchasing a product
This shows us again that the checkout page is optimized for conversions, and around ½ of people going there are placing orders after. The link clicks to ATC conversion value is high which results into more ATC’s and therefore an overall higher conversion rate of the ads (1.94%).
Conclusions: For the overall preview of the account we can say with confidence the following things: The checkout pages are optimized for conversion The funnel is working perfectly after the ATC event Increasing Link clicks to ATC conversion value results in more sales and higher overall conversion value, meaning more sales
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Audit As a conclusion we can say that we should focus on increasing the amount of relevant traffic in order to decrease the cost per click and increase the amount of ATC. This can be done by optimizing (1) audiences for higher relevancy and (2) by creating highcontrasting ads to increase CTR’s. 1.4. Pixel installation To ensure the proper tracking we need to verify that the Facebook is set-up correctly and tracking every step of the funnel on the website.
At this point the pixel is tracking successfully the following events:: Page View View Content Add To Cart Initiate Checkout Purchase Add Payment Info Search
Those are the main pixel events needed to track conversion on the website. The pixel is well educated and has a huge amount of data that can be worked with. This is essential in terms of optimization, because the pixel has the data needed to optimize based on interaction with both the ads and the website. We can enhance the tracking by placing more events to track additional conversions, create segments, cohorts and analyze the flow of traffic in order to maximize the results of paid advertising. This is done by implementing custom conversions on the website depending on the type of the campaigns and the data that we need to collect in order to optimize the campaigns in a desired way.
2. Locating winning campaigns: To locate the winning campaigns we have set-up a preset that allows us to view in depth the performance of the best (and worst) campaigns, ad sets and ads.
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Audit The main indicators to evaluate the performance of the campaign are the ROAS (Return on Ad Spent) and the Website Purchase Conversion Value (Revenue). While both indicators are important we can’t evaluate the campaign based only on one of them because a high ROAS might result in low Revenue and the other way around. Looking at the ad account we can easily locate the campaigns with the highest amount of Revenue.
Picture#1 – Evaluating Best Performing Campaigns
To do we exported the data and created a spreadsheet to filter the campaign easily. Our criteria of choosing the best performing ad sets were: Campaigns generated more than $10K ROAS of 3 or higher
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Audit We were able to find 21 campaigns that met those conditions. At picture one you can see the most important stats of each of the campaigns. After locating those campaigns we evaluated their performance comparing revenue, ROAS and amount spent. In result of that we were able to locate the 6 winning campaigns with the highest ratio of spent and ROAS, having in mind factors like delivery, optimization, amount spent and the scale of the campaign. We were also able to locate 6 campaigns with a huge potential of development that should not be ignored, although they did not generate high Revenue. Those campaigns (marked in yellow) are showing not only high ROAS, but also higher CTR rates which can result in lowering the overall CTA and increase the ROI in long-term. One thing we noticed, however, is that 67% of the best performing campaigns are actually retargeting campaigns (DPA’s). Although it’s expected that retargeting campaigns to convert better we can see that there are 3 campaigns that we should take into consideration: SA_Note 7 - Cloak 2.0 – US Samsung NOTE 5 AUG | Note 5 Waterproof [confidential] Studstar - All Countries
Those are cold traffic campaigns that generated ROAS higher than the average for an eCommerce account. Those campaigns should be taken into consideration when creating new cold traffic campaign in order to maximize potential of the paid advertising effort.
3. Locating loosing campaigns: To locate the worst performing campaigns we proceed the exact same way we did finding the best performing campaigns but this time we evaluated the lost the account made during their life.
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Audit Picture#2 – Locating Worst Performing Campaigns
Now we should be taken into consideration that although those campaign didn’t generate positive ROI, they might have helped the best performing campaigns. It’s a common tactic to use campaigns that only generate quality traffic with no sales in mind, so that the retargeting sales campaigns generate actual sales. Our criteria was again to search for campaigns that spent more than $10K but this time generated ROAS under 2.
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Audit After filtering the campaigns (Picture 2) we noticed several campaigns that spent a big amount of money with generating no sales (marked in orange). Those campaigns are not successful in terms of sales, but generated a good amount of traffic. However, the CPC in those campaigns is not the lowest one compared to the other campaigns. This results in high spent with little to no ROAS - $187,388.38 spent and generated $56,609.03. To compare the stats we’ve marked another 4 campaigns that performed similar to the worst performing campaigns – they spent $171,860.35 but generated $292,802.02, while driving quality traffic at the same (even lower) prices. In accounts with higher monthly spent it is very important to maximize the effort from each campaign. Generating traffic is important but spending as shown $180K spent can be used to keep the account around the “break even” point without relying on the retargeting campaigns only. This gives diversity of the account and regular cash flow which can allow more testing and optimization.
4.Targeting evaluation The focus on targeting is mainly focused on 2 categories: Targeting people by their smartphone Retargeting people who have landed on the website
There are a lot of variations in the account testing different combinations of audiences for each product based on country, device type, age, placements and conversion window.
To audit the account on ad set level we used a pivot table to help us better understand the data available. We also took into consideration 20% of the ad sets having the best and worst campaigns inside the pool. The audit showed the following things:
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Audit Using narrow audiences doesn’t lead to conversions Optimizing for link clicks on ad set level underperforms compared to event based optimization Targeting only feeds looks like a reasonable decision but should be done with a strong ads only since it does not convert every time Targeting specific countries can be optimized. Countries should be segment and those segments should be tested. At this point the countries are put together just because the amount of sales and there are factors like affinity, language, state of market and other variables that should be took into consideration Broader targeting (bigger potential reach) works better for this account
5. Campaign optimization evaluation The account is mainly using the Conversion type of campaigns, focused on the “Purchase” event optimization. There are also Catalog sales campaigns, link click and landing page views campaigns, and some 10 seconds video view campaigns. The best performing campaigns are the DPA retargeting campaigns, followed by the cold traffic campaigns optimized for purchases. Recommendations: Structure new campaigns as “Master Campaigns” based on campaign optimization & objective for easier navigation Pull campaigns inside the “Master campaigns” as ad sets
Revise working/not working campaigns and restart/kill the ones that are generating most/no Revenue
6. Ad set optimization evaluation In the account there are more than 8K ad sets. We tracked almost every possible variation of testing including LLA’s, manual vs automatic bidding, 1 day vs 7 day conversion window optimization, different variations of targeting, optimizing towards events and others. In order to better understand the ideal customer we had to make some breakdowns of the account. First we split the purchases by country (Picture 3). As it can be seen, the main source of purchases comes from the following countries (more than 5k):
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Audit United States United Kingdom Australia Canada
Those segments are important, especially people in the US, because little more than 102k purchases came from there. This not only means that people are converting there but also that the costs per purchase are lower. Since there is a huge difference in the amount of purchases in different countries we would recommend separating the US market out of the others and promoting the product specifically for it. Another segment that should be tested is a combination of the top 5 countries with most purchases (excluding US).
Picture 3 - # of Purchases by Country
US GB AU CA DE NZ IE NO FR SE SG NL BR MX MY HK CH DK PR ES BE AE IT TH ID ZA PT
102252 30733 16227 14421 7262 4118 3030 2984 2599 2084 2047 1765 1525 1274 1127 1124 1088 991 989 937 720 714 690 679 630 616 606
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Audit After understanding the geo-location of the ideal customer we break the purchases by gender. It was no surprise to find out that men are generating not only more revenue but at lower prices (higher ROAS). From Picture 4 we can see that men are generating x2 revenue. Engagement is 15% higher when ads are shown to men and the cost per click is around $0.10 lower. While this might sound like a small amount, by multiplying this difference to the actual clicks that were done by females, we can see that for around 300k clicks, generating traffic from women costed $270,000 more compared to men. While it’s important to understand that females are generating sales, we should be able to manage delivering ads to women effectively in order to reduce the costs and maximize the profit.
Picture #4 – Engagement & Purchases by Gender
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Audit Last but not least, we did a breakdown to people who have bought the product by age. In picture 5 we can see that teenagers do not interact a lot with the ad. This can be due the higher price for the product(s), or high competition (teenagers engage more with ads and are bombard with those but they rarely buy). On the other hand we have elders, aged 65+, who engage a lot with the ads. However, the revenue generated by that segment is the second smallest (teenagers being the worst performing audience). By reducing the ad spent on them by 50% we can save up to $90k, which can be invested in more profitable segments. (Example: reinvesting $90k for ads targeting 18-24 can provide up to 25% more revenue, having in mind ad account’s historical data). It turns out, with no surprise again, that the most converting audience are people aged from 18 up to 54, with 25-44 being the most profitable audience. Having diversity in the ad account is always a good idea, and that’s why we are recommending going with a broader age range. It is important to also note that, although the above stated segments are evaluated by their performance, as overall the average ROAS is x2, which means that in other circumstances (higher margin rate) they should be giving a positive ROI.
Picture#5 – Engagement & Purchases by Age Range
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Audit After the evaluation we came up with the following conclusions: Automatic bidding outperforms manual bids in most cases 7 day conversion window works better than the 1 day conversion window Android devices outperform iOS devices Conversion most often happen on Facebook and IG, but although underperforming compared to them, the Audience network and Messenger can be good sources too Right column and Instant Articles don’t convert Conversions happened mainly in the countries from Picture 3 Conversions are made by men, aged 25-44 The level of engagement within men is higher compared to women, therefor the cost per click is cheaper for that segment Elders engage more often, but purchase the product(s) less It’s cheaper to distribute ads to teenagers but they don’t actually buy
7. Ad optimization evaluation After evaluating the account on ad set level let’s look at the performance of the actual ads. As it can be seen from the screenshots below ad with the same copy can be from the best and worst performing ads at the same time. The reason behind this is the targeted audience and the optimization on ad level. To evaluate the best and worst performing ads we take into consideration the amount of sales generated and the ROAS, having in mind the lifetime amount spent. Let’s look at both the best and worst performing ads.
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Audit Best performing ads:
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Audit Worst performing ads:
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Audit As we can see from the screenshots the main differences between the ads that make sales and those which doesn’t are: Some of the winning ads are dynamic The wining copy is upper and lower cases, while the ads that didn’t drive sales mostly are written in uppercases only While winning ads CTA is always “Shop now” some of the ads that underperform have the “Learn More” CTA Creatives (images) in the selling ads the spotlight is on the product and they are often with white background and nothing else but the product, while ads that didn’t sell have backgrounds, additional info added with pictures and text
After the evaluation we can say that we found the following mistakes: Copy is hard to read and not optimized There is no CTA added in the copy
Ads should be taken into serious consideration since they are the “face” of the campaigns and it’s what makes potential customers to actually leave Facebook and purchase the product. While targeting is important in order to deliver the ads to the right audience, with poor ads a campaign’s chances of success are minimum. There are several rules that should not be ignored when ads are created and are proven to increase their performance. Having those in mind we can recommend the following rules for optimizing the campaigns: The copy should always start with an upper case and the body should be written in lowercases, unless there is a specific word that we want the customer to read.
Example: “Shop top rated products by [confidential]. Get low shipping rates and lifetime warranty with all orders.” Copy should be structured and should “breathe”. This means that the text should be written in paragraphs.
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Audit Example: “Shop top rated products by [confidential]. Get low shipping rates and lifetime warranty with all orders. “ ďƒŚ Copy should always have a CTA at the end encouraging users to take some action
Example: “Shop top rated products by [confidential]. Get low shipping rates and lifetime warranty with all orders. Get yours today!â€? ďƒŚ Adding a short link can lead to more conversions
Example: “Shop top rated products by [confidential]. Get low shipping rates and lifetime warranty with all orders. Get Yours Today >> https://productlink.comâ€? ďƒŚ Adding emoji can make the ad more user friendly and is recommended to be used
Example: “Shop top rated products by [confidential]. Get low Shipping rates đ&#x;šš and lifetime warranty đ&#x;šš ď¸?with all orders. Get yours today đ&#x;šš https://productlink.comâ€? Those rules will make the copy easier to read, more eye-catching and therefore leading to clicks and conversions. Speaking about the creatives the account has already proven that clean images with the product on the spotlight, without any distractions will lead to more conversions. From the best 20 selling ads 15 are dynamic products with those kind of images and this should be taken as a strong signal that those creatives are working best at this time.
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Audit 8. Working tactics Using DPA Retargeting users usually converts better than generating new traffic Facebook and IG are the most converting placements Most of the buyers are from the US Creatives with clean product images tend to sell more
Retargeting ATC converts best from the retargeting campaigns “Shop now” CTA sells better than “Learn More” 7 Days conversion window works better than 1 Day conversion window Campaigns optimized for conversions work better than campaign campaigns optimized for link clicks Both manual and automatic bidding are winning strategies (a slightly better results shown by manual bidding)
9. Loosing tactics Optimizing a campaign for link clicks usually loses money (with some exceptions) Instant articles and Right column underperform compared to other placements Advertising to people in 3rd world countries doesn’t lead to conversions Cold traffic campaigns should be killed before reaching $5k to minimize the negative impact on the account Targeting audiences by interests is a good idea only if the interests are not layered to narrow the audience too much (below 1 mil potential reach is low in this case) Typing copy in uppercases only is should be avoided at any costs
Using additional images as background behind the product underperforms “Learn More” should not be used in sales campaigns (especially retargeting campaigns). It can be used, however, in cold traffic campaigns (1st interaction)
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Audit 10. Suggestions Based on the information above and our expertise we can suggest the following improvements: Structure the ad account Narrow audiences by interest Exclude 3rd world countries Separate US from the other countries Continue testing manual vs automatic bidding When bidding manual go with 7 day conversion window Focus mainly on Feeds Focus on selling to men age 24-44 Keep delivery but at lower rates for women, teenagers and elders Keep cold traffic campaigns above x1 ROAS Optimize the retargeting campaigns based on current data, kill poor performing ad sets, reinvest the budget on the winning ones Test PPE’s to stack social proof on winning ads Make the ads more visible by adding more contrast Test GIFS, Slideshow and Video ads Type the copy with the rules made in this report Ad short links in the copy Ad UTM’s in the ads for better tracking Create & test new segments Upsell accessories to people who have bought a case Create automated rules in the account to optimize the management Discounts and offers can be discussed with the client to support retargeting campaigns (coupons for second purchase for example) Selling to people who have already bought a product in the past 365 days can be supportive in terms of sales
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Audit 11. Strategy Proposal 1.1. Summary Our strategy includes active daily management of the ad account putting efforts on optimizing the revenue to spent ratio. The main aspects of the management will include: Improving the CTR by improving the ads on ad level Saving budget by removing underperforming clicks that are not expected to generate revenue Active management of the daily spent with the help of automated rules Improving ROAS Increasing amount of sales Reducing spent Decreasing the AOV
1.2. Goals To achieve those we will use a wide range of split testing tactics, monitoring different audiences, creatives and campaign objectives, having in mind the historical data of the ad account. Successful execution of the strategy should lead us to the following benefits for the business: Increased cash flow Increased net profit Higher customer LTV
1.3. Targets To achieve the stated goals we will need to achieve certain targets. The quantitative expression of the targets for the first 3 months can be seen in the table below.
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Audit Target
Goal
Link Clicks
Increase Link Clicks by 10% (up to 280K/mo)
ATC
Increase from 8% to up to 10% (up to 28K)
IC
Keep stable at 40% (around 11.2K)
Purchases
Keep stable at 50% (around 5.6K)
CPA
Reduce to $15
AOV
Increase to $45
ROAS
X2.5 to 3
Revenue
Increase to $200-250K
Amount spent
Keep between $80-90K
Main changes are increased % of link clicks and ATC’s by 2%. The funnel takes care of the other, increasing revenue and ROAS if the current ad spent is kept at the same levels. We should also expect lower ATC to IC and IC to Purchase conversion values as we increase traffic. However, we have the advantage to know which audience convert to fight low relevancy due poor performing targeting. 1.4. KPI’s To execute our strategy and meet the desired goals & target we need to set up KPI’s which will indicate the success of the campaign performance through its lifetime. Meeting those KPI’s will help us better evaluate our efforts, knowing where we are at each moment and what needs to be improved in order to secure the campaign success. The table below is showing the KPI’s with the desired goals for this campaign. We are increasing the desired results by up to 20% to make sure we will meet our targets and achieve our goals.
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Audit Table: KPI’s
CPM
$6.23
Link Clicks
330,000
Unique Link Clicks
240,000
CTR (Link-click Through Rate)
2%
CPC
$0.27
ATC
33,600
Cost per ATC
$2.70
IC
13,500
Cost per IC
$6.50
Purchases
6500
Cost per Purchase
$13.50
ROAS
3.25
Amount Spent
$90,000
Revenue
$315,000
Avg. sales on a daily basis
220
1.5. Timeline
Table: Overall Timeline Week 1
Preparation of account takeover*
Week 2
Account Takeover
Weeks 3-4
Starting initial split testing/ Evaluation of performance
Weeks 5-6
Optimization and new split testing
Weeks 7-8
Split testing/Scaling winning campaigns/Killing poor performing campaigns
Week 9
Evaluation of performance and optimization
Week 10-11
Campaign scaling
Week 12
Evaluation account performance and suggestion for improvements/CRO
Week 13
Implementation of suggestions
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Audit To ensure smooth transition we have prepared a timeline table, showing the exact amount of advertising budget taken for management from the client by the agency. This will reduce the risk of overspending and must be followed strictly. The process will be done one Week 2 after starting working on the account, while week one will be used to set-up the account in a way that will separate the client’s campaigns from those that the agency will run for him/her.
Table: Account Takeover Process Timeline Day
Day 1
Day 2
Day 3
Day 4
Day 5
Day 6
Day 7
Budget*
10%
20%
40%
60%
80%
100%**
100%***
Action
Take-over
Take-over
Take-over
Take-over
Take-over
Take-over
Take-over
* Budget – actual budget taken on a daily basis that will be managed by the agency ** First assisted day of full take-over – we might need additional information and the client’s surveillance to ensure that the takeover has been done smoothly with no errors *** Evaluation of the takeover and taking full control over the ad account 1.6. Expected Benefits The successful execution of the strategy is expected to have not only increase of revenue but a number of factors, the most important of which are: Reduced financial lost Increased cash flow Free funds for reinvesting in stock and advertising Increased net profit
We are also expecting more relevant traffic, which will support: The organic efforts (better ranking, SEM) Reduced returns & negative feedback Increased brand awareness
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