There are several things you can/should do to improve your situation. You have conversions and sales, so that’s good – you know there’s a market for your products. My biggest question would be… What’s your value proposition? Why should a customer purchase from you instead of your competitors?
I feel like 99% of businesses and at-home online retailers never think of this. You can’t simply build a polished/clean website, pay for some clicks, and hope to radically make profits (not critiquing you here, just this mindset). You need to be better, faster, or cheaper than your competitors. Cheaper isn’t really going to get you anywhere here because you are already in the red. And you can’t be faster because you have the stock yourself and are shipping yourself.
So you need to figure out how to be better than your competitors. Again, what’s your value proposition?
Aside from this, you really only have 2 options. Increase sales/revenue, or decrease your ad costs. Here are some suggestions for those…
1. Improve your average customer value or your cart value. Discover, test, experiment ways to find additional products that your purchasers would also be interested in. Do you have any upsells directly after the initial purchase? If not, that’s an immediate fix you need to do ASAP. Are you collecting emails and marketing complimentary products to your purchasers via email? If not, again, that’s an immediate fix that will increase your customer value.
2. Improve your CTR on your ads. CTR is directly proportional to your CPC and cost per conversion. Get cheaper clicks and your customers won’t cost you as much. And I agree with what you said in your post, DO NOT increase CPC at the advise of your friend because this will only make the problem much worse.
Last suggestion… Is there any actual sales copy on your landing page? I’m sorry for being direct, but you simply cannot build a profitable and **sustainable** business with a generic (even paid) shopify store page. I know businesses and advertisers spending over $1 million per month on ads (or more) and absolutely none of them send people to a store page when they click an ad. You need a landing page that *sells* your product. Google “advertorial” or “video landing page” if you need more direction.
Good luck. This isn’t easy, but when it works it’s beautiful.