There is a common pattern with paid digital advertising channels. New platforms appear with opportunities for cheap ads. Over time, more and more advertisers start to use the platform. Supply and demand drives up the price per click. The platform owners also do everything they can to nudge click prices ever higher. Consequently ad prices rise until companies selling inexpensive products (like mine) can’t afford to bid high enough to get any clicks. But usually a new platform comes along and the dance starts again.
I’ve seen this play out over the 20 odd years that I have been using Google Adwords. In the early days I could get a decent number of clicks at an affordable price. But the price has risen now to the point where I get very few clicks for any price I am prepared to pay. I need a new advertising channel. I tried advertising on Reddit, but that was a resounding failure. I wondered if it might be worth advertising in the new hotness, ChatGPT. So I did some investigating. Here is what I have found out so far, from reading their documentation and other sources.
ChatGPT advertising is structured in a similar way to Google Adwords, with campaigns, ads, auction bids and conversion tracking. But, instead of matching keywords in search terms, you describe contexts in which your ads should appear. This should be less hassle than defining hundreds of search keywords. But it is hard to know how well targetted the ads will be or how well they will convert into sales. Some experimentation is required to answer that.
The ad format is fairly simple: name, headline, short description and small a image.
You can currently only advertise to customers on free plans based in USA, Canada, Australia and New Zealand.
In their own documentation, ChatGPT says: “Advertisers can set custom max bids for their CPC campaigns. We recommend a starting max bid of $3-5 USD per click.”. Yikes. I know they have massive costs to subsidize, but there is no way I can make a profit at $3 per click for my $99 data wrangling software Easy Data Transform. Given a typical 1% conversion rate I would be paying $300 per sale. However, bid recommendations are always very self serving, and can be taken with a large pinch of salt. It is likely that you can get clicks much cheaper. Especially given that there are currently relatively few advertisers compared to the number of users.
So far, so good.
The fly in the ointment is the minimum spend. $50k (down from $250k!). Ah. Maybe not. That minimum commitment may come down over time. But, by the time it is low enough for me to experiment, the bids will almost certainly be too expensive for it to be profitable to someone selling $99 software licenses. The search for affordable advertising channels continues.
** Update 29-May-2026 **
There are reports that the $50k minimum spend has now been dropped. However advertising is only open to US advertisers. More details.
I am always on the lookout for cost and time effective ways that I can market my software products. Previously, I have had quite a lot of success with Google Adwords Pay Per Click ads. However, the law of shitty clickthroughs means that advertising platforms generally get less and less profitable (for the advertisers) over time. And Google Adwords is a case study of that law in action. As Reddit is a less mature advertising platform, I thought it might still offer opportunities for a decent return. So I decided to experiment with advertising my data munging software, Easy Data Transform, on Reddit.
[By the way, I understand that nobody goes to Reddit because they want to see ads. But commercial products need to market themselves to survive, and Reddit probably wouldn’t exist without ads. Yay capitalism.]
Setup
The basic process to get started with Reddit Ads is:
Sign up for a Reddit Ads account.
Enter your details and credit card number.
Create a campaign.
Create one or more ad groups for your campaign. Choose a bid for each ad group, which countries you want it shown in and who you want it shown to.
Create one or more ads for each group.
Add the Reddit tracking pixel to every page of your website.
Set up conversion goals.
All pretty standard stuff for anyone who has used Google Adwords. The twist with Reddit is that you can advertise to communities (sub-Reddits), rather than based on search keywords. For example, Easy Data Transform is a much better tool for most data wrangling tasks than Excel, so I can bid to show ads targeted at Excel users in communities such as: reddit.com/r/excel/ and reddit.com/r/ExcelTips/.
Like Adwords, there are various ways to bid. I don’t want the advertising platform to set the bid prices for me (because I’m not insane), so I opted for fixed price bids of between $0.20 and $0.40 per click. Some of the ad groups suggested much higher bids than that. For example, the suggested bid for my Excel ad group is $0.79 to $4.79 per click!
However, Easy Data Transform is only a one time payment of $99. Paying more than $0.40 per click is unlikely to be profitable for me, especially when you factor in support costs. So that is the maximum I was prepared to bid. Also, the suggested bids are just the ad platform trying to push up the bid price. Something that anyone who has used Google Adwords will be all too familiar with. I was still able to get clicks, bidding significantly less than the recommended minimum.
I also set a daily maximum for each ad group, just in case I had messed up and added a zero in a bid somewhere.
I created multiple ads for each ad group, with a range of different text and images specific to the communities targeted. Here are some of the ones I ran in the Excel ad group:
I didn’t try to use edgy images or memes, because that isn’t really my style. There is an option to turn comments on below ads. As Reddit users are generally not well-disposed to ads, I didn’t try turning this on.
Based on hard-won experience with Google Adwords, I only set my ads to run in wealthy countries. I also restricted my ads to people on desktop devices as Easy Data Transform only runs on the desktop.
When Easy Data Transform is installed, it opens a page on my website with some instructions. So I used this to set up the Reddit conversion tracking to count the number of times a click ended up with a successful install of either the Windows or Mac version of Easy Data Transform.
I monitored the performance of the ads and disabled those that has poor click through or conversion rates and made variants of the more successful ones. Darwinian evolution for ads. I ended up creating 70 ads across 15 ad groups, targeting 50 communities.
I wasted an hour trying to get Reddit to recognize that I had installed their tracking pixel. But, overall, I found the Reddit Ads relatively simple to setup and monitor. Especially compared to the byzantine monstrosity that Google Adwords has become.
Reddit advertises a deal where you can get $500 of free ads.
But the link was broken when I clicked on it. Someone else I spoke to said they had tried to find out more, but gave up when they found out you had to have a phone call with a sales person at Reddit.
Results
I ran my experiment from 08-Jul-2025 to 31-Jul-2025. These are the stats, according to reddit.
Spend
$851.04
Impressions
490,478
Clicks
3,585
Windows installs
177
Mac installs
63
Total installs
240
Click Through Rate
0.73%
Cost Per Click
$0.24
Click to install conversion rate
6.59%
Cost Per Install
$3.55
I generally reckon that somewhere around 10% of people who install are going on to buy. So $3.55 per install would mean around $35.50 cost per sale, which is reasonable for a $99 sale. So that all looks quite encouraging.
But, comparing the Reddit number to the numbers I get from Google Analytics and my web logs, I think the Reddit numbers are dubious. At best. In a week when Reddit says it sent me 1174 clicks, Google Analytics says I received 590 referrals from Reddit and my web log says I received 639 referrals from Reddit. Some of the difference may be due to comparing sessions with clicks, time zones etc. But it looks fishy.
The discrepancy is even greater if you look at conversions. The total installs per week reported by Google Analytics and my web logs didn’t go up anything like you would expect from looking at the Reddit conversion numbers. If you dig a bit further, you find that Reddit uses ‘modeled conversions‘ to:
“Gain a more complete view of your ads performance with modeled conversions, which leverages machine learning to bridge attribution gaps caused by signal loss.”
Uh huh. Sounds suspiciously like ‘making shit up’.
And then there are the sales. Or lack of. I don’t have detailed tracking of exactly where every sale comes from. But I estimate that my $851 outlay on ads resulted in between $0 and $400 in additional sales. Which is not good, given that I don’t have VC money to burn. Especially when you factor in the time taken to run this experiment.
The top 5 countries for spend were:
Italy
Spain
France
Germany
Singapore
The US only accounted for 0.28% of impressions, 13 clicks and $3.81 in spend. Presumably because the US market is more competitive, and I wasn’t bidding enough to get my ads shown.
You can look at various breakdowns by country, community, device etc. This is helpful. But some of the breakdowns make no sense. For example, it says that 41% of the click throughs from people reading Mac-related communities were from Windows PCs. That sounds very unlikely!
But the worst is still to come. Feast your eyes on this Google Analytics data from my website:
Average engaged time per active user (seconds)
Engaged sessions per active user
Google / organic
33
0.75
Successfulsoftware.net / referral
31
0.74
Youtube.com / referral
27
0.86
Chatgpt.com / referral
24
0.69
Google / CPC
16
0.65
Reddit / referral
8
0.25
8 seconds! That is the mean, not the median. Yikes. And 75% of the sessions didn’t result in any meaningful engagement. This makes me wonder if the majority of the Reddit clicks are accidental.
I had intended to spend $1000 on this experiment, but the results were sufficiently horrible that I stopped before then.
If I had spent a lot of time tweaking the ad images and text, landing pages, communities and countries, then I could probably have improved things a bit. But I doubt I could ever get a worthwhile return on my time and money.
If the lifetime value of a sale is a lot more than $99 for you, or your product is a good fit for Reddit, then Reddit Ads might be worth trying. But be sure not to take any Reddit numbers at face value.
An AdWords account that starts off making a worthwhile profit for the owner is often neglected and, within a year or two, is losing money. Potentially a lot of money. I have seen it happen again and again. If you are running a Google AdWords campaign, you have to at least monitor it. Better still, actively maintain it. Otherwise the rot will soon set in.
Here is an example of an AdWords campaign that was professionally set up and then left to coast, unmanaged. You can see that the cost per converted click (blue) rose, while the number of conversions (orange) fell a little. The average cost per conversion (trial) rose by a factor of 3 in just 4 years. What was once a profitable account was now wasting a lot of money. Ouch.
The main reason for the rot is that Google are continually changing AdWords, and they may opt you in to new features without asking you. For example they automatically opted display advertisers into showing ads in free-to-play AppStore games. B2B business owners were paying thousands of dollars for clicks made by bored children in Flappy Bird and the like. I have seen accounts where thousands of dollars have been spent on these worthless clicks. And these were small companies. Other reasons include:
Your display ads might start showing on a new website where they convert badly.
Poor targeting. Perhaps a new product, film or band has appeared with a name similar to your product.
Increased competition and bid price inflation can reduce a healthy amount of traffic to a trickle, reducing profitability.
Click fraud.
So you really need to keep an eye on your AdWords account. At an absolute minimum you should monitor the number of conversions and the cost per conversion and investigate any unfavourable changes. To keep your account in good shape over time you need to actively maintain it, e.g.:
Delete any keywords with poor click through rates (typically I delete keywords with a CTR of 0.5% or less after 200 or more impressions).
Delete any keywords with poor quality scores (typically I delete keywords with a QS of 3 or less).
Delete any keywords or ads with poor conversion rates.
Examine the dimensions>search terms report for negative keywords to add.
You can easily set up filters and get automated reports sent to you to make this fairly painless. These checks should be done perhaps once a week for a new or high budget campaign and perhaps once a month for a mature or low budget campaign. You can also make your life easier by setting up AdWords so that Google is doing most of the heavy lifting for you. For example you can use CPA bidding and you can set the ad rotation setting to Optimize for conversions: Show ads expected to provide more conversions.
A mature account that has been well set-up and has a budget of around $1k per month, probably only needs an hour a month to maintain. Alternatively, if you can’t spare an hour or two a month to manage your AdWords campaign, do yourself a favour and shut it down. Now.
Google Adwords used to be a great way to get targeted traffic cheaply (if you knew what you were doing). I think those days are well and truly over.
I have been using Google Adwords to advertise my table plan software since 2005. The following graphs show some metrics from my Adwords campaigns over that 8 years. The graphs show 12-monthly cumulative figures (e.g. each point represents the value for that month plus the preceding 11 months). Using cumulative data hides some of the noise, including the seasonal variations that are inevitable in a business related to weddings (more people buy my software when it is summer in the northern hemisphere), and makes the overall trends clearer.
Average cost per click (CPC)
Clickthroughs
Conversions (sales)
Profit per month
The trends are clear and it’s not a pretty picture. Less, more expensive clicks = less profit. I can either pay more and more per click to maintain the same number of sales. Or I can continue to pay the same per click and get less and less clicks. Either way, my profit goes down. It isn’t a trend I see changing direction any time soon.
I think these long-term trends are mostly due to increasing competition. As more and more companies bid on Adwords for a finite number of clicks, it inevitably drives up the cost of clicks (simple supply and demand). It also doesn’t help that a lot of Adwords users are not actively managing their campaigns or measuring their ROI, and are consequently bidding at unprofitably high levels. Google also does its best to drive up CPC values in various ways (suggesting ridiculously high default bids, goading you to bid more to get on page 1, not showing your ad at all if you bid too low – even if no other ads appear etc).
Of course, this is just my data for one product in one small market. But the law of shitty clickthrus predicts that all advertising mediums become less and less profitable over time. So I would be surprised if it isn’t a general trend. Are your Adwords campaigns becoming less profitable? Have you found another advertising medium that works better?
An AdWords account that starts off making a worthwhile profit for the owner is often neglected and, within a year or two, is losing money. Potentially a lot of money. I have seen it happen again and again. If you are running a Google AdWords campaign, you have to at least monitor it. Better still, actively maintain it. Otherwise the rot will soon set in.
Successful Software 