Generally speaking, a good click-through-rate is 5 to 20%. Both analysing and keeping track of your click-through-rate helps to give you a better idea of how well your ad is being received by your target audience.
In the same breath, then, a low CTR could help you to establish whether you are attempting to target the wrong audience with your ad.
There are various ways to improve your click-through-rate, such as including a direct call to actions (CTA). Personal and clear CTAs help you to prompt your audience and carry out the desired action, thus helping to drive up your CTR.
Measuring your click-through-rate, then, helps you to better understand your target audience and reveals what works when you’re trying to reach and resonate with your customers.
Another useful metric that can be used to measure ad performance is cost-per-acquisition.
In other words, CPA is the total marketing cost divided by the number of new customers. Bearing this in mind, if you spent £1000, and gained 100 customers, your cost-per-acquisition would be £10.
The main factors that impact your CPA are both your conversion rate and cost-per-click.
By measuring and monitoring your cost-per-acquisition, you can determine the effectiveness of your advertising efforts, how cost-effective your ads are, and what you can improve on in future campaigns.
3. Conversion Rate
The next metric you can use to measure your ad performance is conversion rate.
Cost per thousand relies on impressions, which is essentially the number of views or engagements with a specific ad, and is arguably the most popular method for ad pricing.
Say an advertising platform charges £10 CPM. As a result, you will have to pay £10 for every 1000 impressions that your ad receives.
CPM is important to be aware of because it will determine how much money you’ll need to pay for every 1000 impressions. That said, CPM can depend on the media channel that you’re advertising on. For instance, Facebook ‘tends to be higher’ than Instagram.
By measuring CPM, you can use the results to determine the effectiveness of the various media channels you choose to advertise on, helping you to get the most out of your ad spend.
We are Aura Ads, a unique performance creative agency designed for D2C eCommerce brands. We help clients sell more online and grow at scale with our bespoke video and static creative, delivered on a monthly basis. For more tips and tricks from our experts, head over to our blog page. Check out some marketing automation use cases.
Written by Jemima Thomas for Aura Ads.
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