How to Measure the Effectiveness of Online Advertising
From the day online advertising took off, marketers have experienced some difficulties in measuring the success of online campaigns. How can businesses find out if the ads are profitable or, on the contrary, splash the budget to no avail?
Today, on the Short.cm blog, we'll guide you through the tools that help money not go down the drain.
Why Calculate the Success of Online Advertising
Any advertisement is an investment. Every investor wants to evaluate the effectiveness of the invested funds. Advertisements could be unpredictable – some campaigns fail, the other ones have unexpected success. You'll never discover the reason for the ad behavior unless you collect, store, and measure the data on your campaigns and marketing strategy.
The advertisement campaigns can be based on different ideas, but each of them has the same measurement algorithm. They take origins from a source (search engine, social networks, websites) and lead through the CTA to an action on your site (make a purchase, fill out the form, subscribe).
You can use the built-in analytical tools to track the success of such a campaign (Short.cm statistics, Facebook/Twitter analytics). But, if you want to combine the results of multiple campaigns, this is where some advanced instruments take place.
The bigger and more scaled your online advertising strategy becomes, the less transparent your cost and profit may be. This can lead to financial losses, which can be avoided by using the proper tool in time.
The next level of measuring advertisement success is to estimate all campaigns together. That is possible with the Google Analytics overview.
All campaign overview is used to estimate the success of each campaign. With the information gathered in one table, the list of campaign names and key metric success is established.
With this information, you can detect the most successful and failing campaign. Each campaign needs to be considered in a more detailed way and improved. The Overview table contains a list of campaigns and the metrics that can be chosen depending on your needs.
The Cost Analysis Report is needed to allocate the budget effectively. It compares the advantages of each campaign you are running or each channel you are using. With the structured data, shown in the table, a comparison between the input and the output is established. Revenue and conversions are concluded based on the goals you set up on Google Analytics.
With this information, you can see how well each campaign or channel performs. This can be an important step in improving your budget allocation or calculating return on investment.
The Cost Analysis contains a list of sources/mediums and the metrics that can be chosen depending on your goals. Some of them are:
With this data, you get calculated ROAS (Return on Ad Spend) and RPC (Revenue per Click) to estimate whether the budget for each campaign is worth spending or not.
By launching an advertisement on Facebook or Instagram, Facebook Pixel can perform similarly to Google Analytics. FB Pixel helps to track the performance of campaigns. You can track how many leads have been generated by a particular ad.
The campaign overview contains the list of ads that you are running and a set of metrics. You can choose the metrics depending on your needs. Note that Ads analysis includes cost per result, so you can calculate the budget that you are spending on a campaign.
With this information, you can see how each campaign or channel performs and whether the budget that you have invested is worth it or not.
One advantage of Segment is that it allows you to integrate 100 different analytical services without embedding codes. You need Segment to measure the success of advertising campaigns if you don't want to paste JS code separately to your website.
Many analytical apps are available, such as multiple event-driving tools (Mixpanel, Amplitude), storing event data (RedShift, BigQuary), Google Analytics, and Facebook Pixel.
The analysis is the basis of any activity that helps to detect some strengths and weaknesses of the actions. Track, measure, and evaluate your marketing campaigns to conduct effective and low-cost advertising.
What did you learn?
- online advertising effectiveness;
- tools for measuring success of online campaigns;
- how to track obline ads;
- how to estimate the effectiveness of short links;