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Paid Ads

Guide

Read your ad metrics without a marketing degree

The only 5 numbers you need to look at to know if an ad is working.

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  1. 1) CTR (Click-Through Rate)

    CTR = clicks ÷ impressions. It tells you if your ad is interesting to your audience. Search ads: aim for 4%+. Social ads: aim for 1%+. Below that, the creative or targeting is wrong.

  2. 2) CPC (Cost Per Click)

    CPC = spend ÷ clicks. This is what you're paying to get one visitor. Search ads: $1–$5 is normal for most industries. Above $10 for local: your keywords are too broad or you have no negatives.

  3. 3) Conversion Rate

    Conversion Rate = conversions ÷ clicks. What percentage of visitors did the thing you wanted (bought, called, filled the form)? 2–5% is average. Below 1%: the landing page, offer, or ad-page match is broken.

  4. 4) CPA (Cost Per Acquisition)

    CPA = spend ÷ conversions. What did it cost to get one paying customer or lead? This is THE number that matters. If your product profit is $80 and your CPA is $60, you're making $20 per sale from ads.

  5. 5) ROAS (Return On Ad Spend)

    ROAS = revenue ÷ ad spend. For every $1 you put in, how many dollars come out? 2× is break-even for many businesses (accounting for cost of goods). 3–5× is healthy. 1× means you're paying to work.

  6. Ignore vanity metrics

    Impressions, reach, video views, and even 'engagement' feel great but don't pay the bills. Only look at the 5 above. Meta and Google will keep suggesting you optimise for 'reach', resist.

  7. Check just once a week

    Ad platforms suggest daily monitoring so you 'engage more'. Weekly is enough, daily data is too noisy to draw conclusions from. Set a Monday morning 15-minute review, look at the 5 numbers, adjust, close the tab.

That’s the whole thing.

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