How To Measure Online Advertising Results

How will you know if your online advertising campaigns are paying off? Are you getting good return on investment or are you spending so much for nothing? As an online advertiser, you need to measure the results of your online advertising campaign to ensure you are getting something in return for your advertising expenditures.

Measuring Online Advertising Results

There are several ways to measure online advertising results but three are most popular. These basic measuring ways are used by most online advertisers not only for the relevant results they can provide but also for their easy computations. You need not be a statistics expert to identify whether you are getting profit or returns from your advertising investments.

Conversion Rate

To measure the conversion rate of an online advertising campaign, data like the number of site visitors who made a positive response or purchased and the total number of site visitors are needed. Conversion rate pertains to the number of site visitors who were converted to customers. It shows how many among the site visitors purchased. To get the conversion rate, follow this simple formula:

Conversion Rate = Number of Site Visitos Who Purchased

Total No. Of Site Visitors

The goal is to get higher conversion rate. The more site visitors are converted to customers, the higher the profit that the website will receive. However, you should also consider the value of the sale. Is it worth the ad expenditure? This leads to the measuring return on ad spend.

Return On Ad Spend

How much do you get in return for every dollar you spend in advertising your products and services? If you spend a hundred dollar in an advertising method, your goal is to achieve higher profit or revenue than the money spent. To measure the return on ad spend, you need the total advertising expenditure and the total profit. Below is a simple formula for calculating return on ad spend:

Return On Ad Spend =      Profit
Ad Expenditure

Profit Per Sale

If you want to     measure the profit you get from each sale, you need to identify first the ad spend and the profit. Then use below formula:

Profit Per Ad Spend = Profit
Ad Spend

If a sale is valued at $100 and the ad spend is $10, then you get 10% profit. It is $10 profit per ad spend.

Measuring the results of an online advertising campaign is a must for online advertisers. If an online advertising campaign yields good profit, then the online advertiser should keep doing it. On the other hand, if the campaign isn’t generating any good profit, the online advertiser should try to venture into other advertising methods. The decision will depend on the results of the online advertising campaign, thus, measuring the results is a critical factor in the overall advertising process.