Choose advertising metrics to prioritize
1. Select a clear advertising goal such as lead generation, brand awareness, or web traffic
Ask yourself, What is it I aim to achieve with my marketing efforts? For example, a life insurance agent might choose lead generation as an advertising goal. Or a national beverage company might select brand awareness as their goal. Each of these advertising goals will have different metrics to track and ways to improve the campaign, so you must be very clear from the beginning.
2. Select advertising metrics like Impressions, Reach and Clicks, to track
For example, if brand awareness is your primary goal then metrics like Impressions and Amplification rate will matter most. Whereas if it’s lead generation then metrics like Conversion rate and Clickthrough rate become more important. You should keep track of metrics like: Cost: Total advertising cost. Cost Per Click CPC: The cost charged per click. Cost per Conversion: Substitute this metric for your goal metric, either cost per conversion, cost per lead, or another metric that tracks the cost of the action taken. Average Order Value (AOV): The average revenue per customer order. What is the average order value of your customers? AOV = Revenue / Number of orders. For the full list of metrics you can refer to each platforms’ documentation.
3. Select an advertising result metric like Cost per Lead or Sale, or Impressions, that is most relevant to your goal. For example, Cost per Lead for lead generation.
Depending on the adverting goal you selected, you will need to track for different advertising metrics. The most important metrics to track for each goal: CPL = Cost per lead: When looking to generate leads, the cost to generate a lead is a must track metric. CPS = Cost Per Sale: Is the cost to generate a sale, also a must track metric. Cost per Impression: Is very important when advertising for branding. You need to know how much each impression costs you, and if other platforms offer more impressions for less. CPA = Cost Per Action: Is another metric to track if you’re looking to generate a different result than sales or leads. For example, to track the cost of calls to a business from advertising.
4. Calculate the Cost per Lead, Cost per Sale, or Cost per Impression metrics.
Formula to find these metrics: Cost per lead = Cost to advertise / number of leads. $100 cost/ 20 leads = $5 per lead. Cost per Sale = Cost to advertise / number of sales. $100 cost / 5 sales = $20 cost per sale. Cost per Impression = Cost to advertise / number of impressions. $100 cost / 1000 impressions = $0.10 cost per impression.
5. Monitor the Cost per Lead, Cost per Sale, or Cost per Impression metrics.
When you run a digital marketing campaign, you need to monitor key metrics. It’s important to monitor and reduce the cost of obtaining new leads, your CPL.
6. Go to your advertising platform or tracking software, and activate the reports which allow you to view these metrics.
Most advertising platforms provide these metrics automatically you just need to set them to show as columns, to show the data. Example on the image below you can see how we set up these metrics on Facebook Ads manger.