Tracking the performance of your digital marketing efforts is key to ensuring they’re serving their purpose. There’s an enormous amount of data made available to eCommerce marketers. So much, in fact, that it can make the effective tracking of your marketing metrics seem like a daunting feat. Knowing which marketing metrics to focus on is a significant starting point for easing the load. And our digital marketing experts at WhiteOwl are here to help by sharing five of the top advertising metrics.
While the exact metrics you focus on can depend on your marketing strategy and your overall objectives, here are five worth monitoring:
1. Reach
This marketing metric, as the name suggests, indicates how many individual people see your marketing content. For example, if 1000 people see a Facebook ad, the ad’s reach is 1000. This can be a key metric to track when brand or product awareness is a priority. Calculating the reach of every bit of digital advertising you do, both as a projection before starting and to identify performance during and after execution, can help you assess the impact of your campaigns and readjust them or reallocate resources as required.
2. Click-through-rate (CTR)
In a nutshell, a click-through rate is a percentage that represents the number of ad impressions that resulted in a click. For instance, if your ad was displayed 2000 times and clicked on 20 times, the calculation is 20/2000 which equals a CTR of 1%. CTR can be an essential metric to track, as not only does it indicate the relevancy of your content to your target audience, but it also affects where Google places your ads in terms of hierarchy and how much you pay per click.
3. Conversion rate
A conversion rate is a percentage that shows how many visitors to your eCommerce store complete a transaction. So, the higher the better! For example, if you have 500 people visit your online store and 30 of them make a purchase, the calculation is 30/500 x 100, which equals a conversion rate of 6%. This metric is a key insight for reducing acquisition costs and increasing sales revenue.
4. Cost per acquisition (CPA)
The cost per acquisition, also known as cost per lead, is an essential metric to monitor to determine your paid marketing’s return on investment (ROI). Your CPA essentially informs you of the cost associated with obtaining a customer, so you generally want to keep this number low. For example, if you spend $700 on an ad campaign and gain 15 new customers from it, the calculation is 700/15, which equals a CPA of $46.66. A consistently high CPA can suggest the need for rethinking your campaign structure.
5. Return on advertising spend (ROAS)
In simple terms, the return on advertising spend is how much profit your marketing initiatives generate. For example, if you spend $1000 on an advertising campaign and generate $2000 revenue from it, the calculation is 2000/1000, which equals a ratio of 2:1 or a ROAS of 200%. It’s the ultimate quantitative performance evaluation of your advertising campaigns and the impact they have on your bottom line. Fundamentally, ROAS can help you assess which of your advertising methods are most profitable and which require restructuring.
With over a decade of experience providing SEO and digital marketing solutions to clients around the world and from every niche, WhiteOwl provides real results for organizations of all sizes. So, you can also leave the fussing over the metrics to us! Contact us today to find out how.