Oftentimes overlooked, understanding the key data points can be the difference between a struggling and a thriving online business. In order to understand these metrics, we first need to talk about tracking.<\/p>\n\n\n\n
Tracking is the most important part of running an online business successfully. Unfortunately, many people don\u2019t realize how important tracking is.<\/p>\n\n\n\n
Once tracking is set up, we can talk about metrics:<\/p>\n\n\n\n
This shows how much you pay for every click on the ad and it\u2019s calculated by dividing the total money spent on ads by the number of clicks.<\/p>\n\n\n\n
This shows what % of people are clicking through the ad to get to the sales page.<\/p>\n\n\n\n
This shows you how much every lead that opts-in costs you.<\/p>\n\n\n\n
This shows what % of people bought the product or service you are offering<\/p>\n\n\n\n
This shows how much it costs you to get a sale and it\u2019s calculated by dividing the total money spent on ads by the number of sales.<\/p>\n\n\n\n
This shows the amount of revenue that was generated.<\/p>\n\n\n\n
This shows how much did you get back after spending on ads and tells you if your ads are profitable or not.<\/p>\n\n\n\n
Say you are paying $50 for an ad and that ad has 1000 impressions, meaning 1000 people saw it. Out of 1000 people, 50 clicked your ad. <\/p>\n\n\n\n
This means you have a CTR of 5%<\/strong>.<\/p>\n\n\n\n If your total spend was $50 and you\u2019ve got 50 clicks, that means your CPC is $1.<\/strong><\/p>\n\n\n\n Now, if out of those 50 people, 10 people opt in and 5 of them bought your product, you\u2019ve got a CVR of 10%<\/strong>. Based on that, we can easily calculate the CPA is $10 ( $50\/5) <\/strong>as well as the CPL, which is $5<\/strong> ( $50\/10 leads ).<\/p>\n\n\n\n Now, let\u2019s look at the value of those sales. Say for example, your offer is $50 for every product or service bought.<\/p>\n\n\n\n So your Total Conversion Value<\/strong> is $250, 5 sales of $50 each. Based on that, we can easily calculate the ROAS: $200<\/strong>. Cause you spent $50 to get $200, which is a pretty good investment.<\/p>\n\n\n\n Now this is a simple example, to better understand these metrics. In real life, it\u2019s not gonna be that pretty.<\/p>\n\n\n\n When you have all the data at your disposal, you can then look for weaknesses and try to optimize them.<\/p>\n\n\nWork with us to grow your sales<\/h2>\n If you need help crafting your perfect offer, product stack and sales pages, book a free consultation call with one of our team. We’ll be more than happy to help you out.\n