Most agency conversations focus on ROAS, revenue, and conversion volume. Profit rarely enters the discussion.
This is not accidental. It is structural.
The Incentive Misalignment
Agencies are typically compensated based on spend under management or performance against ROAS targets. Neither incentive aligns with profit.
If an agency is paid as a percentage of spend, they have no incentive to reduce spend even if it would improve profit. If they are paid on ROAS, they have no incentive to distinguish between high-margin and low-margin revenue.
This creates a conversation that centres on metrics the agency is incentivised to optimise, not metrics the business actually needs.
The Data Gap
Even agencies that want to optimise for profit often cannot. They do not have access to margin data, return rates, or customer economics. They operate on revenue and spend because that is what they can see.
This is a solvable problem, but it requires clients to share data they may consider sensitive and agencies to build infrastructure to use it. Many do neither.
The Reporting Convenience
Profit-based reporting is more complex than revenue reporting. It requires joining data sets, making assumptions about costs, and explaining nuance.
Revenue reporting is simple. Up is good, down is bad. Agencies default to it because clients understand it and it does not require difficult conversations.
But simple reporting often hides uncomfortable truths. An account can show revenue growth while profit declines. If you only report on revenue, you never have to explain that.
Why It Matters
For brands spending significant amounts on paid media, the gap between revenue and profit is not academic. It is material.
I have seen accounts where reported performance was strong but actual profit contribution was marginal or negative. The agency was hitting targets while the business was losing money. Everyone was happy except the balance sheet.
The Alternative
A profit-first approach to ecommerce Google Ads requires agencies and clients to share data and align on actual business outcomes. It requires harder conversations and more complex reporting.
But it also produces better results. Not better in a way that looks good on a slide, better in a way that shows up in the bank account.
The agencies that grow with their clients over the long term are the ones willing to have this conversation. The ones that avoid it tend to cycle through clients who eventually notice the gap between reported performance and business reality.