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Successful advertisers use several marketing strategies through multiple channels on a regular basis. They're using email, SEO, pay per click marketing, social media, and many other methods.

Knowing how to actively track the performance and progress when you have several campaigns running is extremely important. Tracking becomes especially useful because it gives you an idea of what ads work and which ones don't -- making it much easier to create successful advertisements down the line.

Successful ads should display your brand's personality and help generate more leads that can convert to sales.

You should always do your best to get the highest return on investment when considering your marketing methods. This involves knowing how to use your key performance indicators (KPIs).

Learning how to use your marketing KPIs can be a confusing process. Especially since there are so many options available. It can make you wonder where you should begin.

In this article, we listed some of the most important KPIs you should be keeping your eye on to get the most out of your ads.

Key Performance Indicators You Should be Using

Key performance indicators (KPIs) are the metrics used to determine how well someone or something is doing. KPIs vary based on the industry and its needs.

In advertising, KPIs are used by marketing teams to prove the effectiveness or ineffectiveness of several types of ad campaigns.

What Makes KPIs So Important?

When you have quantifiable marketing metrics and KPIs in use, you are better equipped to help your company reach its goals of increasing sales or gaining new subscribers. KPIs can be used in real time scenarios. But they can help you compare growth between past and recent campaigns too.

You can't set goals for your campaigns without linking them to KPIs. When you know which metrics you are using from the beginning, you'll get the most out of your cost per click.

More so, knowing the purpose of the campaign, what goals it is supposed to meet, and how you will gauge its performance will be helpful for setting up AdWords and Google Analytics early on.

Correctly tracking the performances of all your campaigns is the best way to itemize your ROI (return on investment.)

These are the KPIs you should be paying close attention to:

Cost Per Click (CPC)

Cost per click (CPC) is sometimes called pay per click (PPC). It's a billing method used by websites based on the amount of times an advertisement is clicked on by a visitor.

There's usually a daily budget set in place for CPC. The budget is determined when the advertiser bids against other advertisers for a spot.

With this said, the advertiser won't always pay the amount they'd planned for. If an advertiser competes in a bid and wins, they normally pay the next highest bid price.

The amount you'd pay as an advertiser is based on your competition. CPC is an estimation of how much the advertiser pays. You can find the amount by dividing the cost of the campaign by the number of times the ad was clicked.

To find out the cost of a campaign, you will multiply the CPC by the total amount of clicks. Website owners tend to use a third-party source to link them with interested advertisers. The most common of those third-parties is Google AdWords.

Click Through Rate (CTR)

The click-through rate is the percentage of people who click on a certain ad that shows on a webpage. This is a digital marketer's way of marking how successful an ad is at simply generating interest.

CTRs can also be used to rank the effectiveness of advertising copy, titles, and descriptions. These are all factors that contribute to the metadata of the content you see online.

More importantly, it's one of the tools that allow digital marketers to learn what does and doesn't work. The website owners, on the other hand, don't receive so much insight.

Quite a few different types of ad campaigns can utilize CTR. Like:

Email advertising
Paid searches
Display advertisements

Website owners often use advertising dollars earned from CTR to support the future of their sites. The higher the CTR is, the more money they will make.

CTR is determined when you divide the total number of clicks to your campaign within the timeframe that's being reported (usually about a month) by the total amount of impressions.

Let's say there was a total of 2,000 impressions and your ad was clicked 200 times. This will give you a CTR of 20%.

Understanding how to calculate your CTR is an important factor when it comes to measuring your ad's performance. Always strive to improve the CTR on your campaigns because it can hinder other KPI's.

Cost Per Acquisition (CPA)

You might also see the cost per acquisition (CPA) listed as CPC (cost per conversion) in other places. In these instances, CPC shouldn't be confused with the cost per click KPI we talked about before.

The CPA is the amount of money an advertiser will pay the website owner if the purpose of their ad was met. This can mean quite a few different things depending on what was said in the ad.

For example, the point of the specific ad could have been to:

Have people sign up for an email list
Drive more purchases
Participate in an event or survey

Whatever the objective of the advertisement is, it is paid for with CPA marketing. With Google, your CPA is determined based on your quality score. Your quality score is a metric set in place that concludes how important the content of your ad and landing page really are.

Target CPA

Another kind of CPA is called Target CPA. It's a bidding technique that's used during the time the ad campaign is set up, but before it's posted.

An advertiser's first step in setting up their Target CPA bidding strategy has to be setting up conversion tracking within Google AdWords, Facebook, or other platforms.

The purpose of Target CPA is to allow advertisers to set automatic bids that help them increase their conversion rates. The bids are based on a CPA the advertiser previously set in place by using their budget.

Target CPA can be used in a single campaign. But it can also operate as a portfolio strategy. Using it as a portfolio strategy makes Target CPA active in multiple campaigns at a time.

There are 6 kinds of automated bidding strategies that can make you prosperous in these campaigns. Google spelled them out in this article.

Cost Per Lead (CPL)

The cost per lead is what you pay a website owner after someone clicks on your ad that can potentially lead to a sale. While this process is similar to CPA, it isn't the same.

With CPL, you're paying for potential customers who did something like signing up for your newsletter, rewards program, or a membership to your website. This makes them a qualified lead who is likely to make a purchase later on.

Your CPL is a useful and accurate tool when it comes to setting sales goals. It's also helpful when deciding how much money you'll use for your advertising budget.

Like other KPIs, there's a formula to calculating your CPL. Dividing the money you've spent on advertising by the number of leads will give you your CPL.

If you use Google Analytics to set up goals, the sources of your leads will be easier to track. This way you'll know whether a particular ad, video, email, or social media post brought the leads your way.

This means you'll know which methods were the most effective. So, you'll have an edge when it comes to strategically spending your advertising dollars on campaigns to come.

Quality Score

We talked about the quality score a little bit. But this KPI is a bit complex. You can receive scores on a scale of 1 to 10. In this scoring system, 1 is the worst and 10 is the best.

For AdWords, Google uses three main factors to come up with these grades such as:

Your Landing Page Experience

Landing page experience includes ease of use on the landing page from smartphones, tablets, and computers. But Google will take the ease of use of your entire website into account as well.

Make sure it only has information that's relevant and engaging. This content should also be transparent. If clicking on the ad goes directly to a sign-up sheet, this can lower your score.

Make sure your landing page has the necessary information about the product or service before you ask customers for their personal details.

Also, ensure it doesn't take too long for the page to load after clicking your ad. This will frustrate customers and lower your score.

The better a landing page is, the less money you'll spend on advertising.

Expected CTR

When you check the expected CTR of the keywords used in your campaign, you want to make sure they will perform well. You can see scores of Average, Below Average, or Above Average in AdWords.

If you see Below Average, replace those keywords with ones that will perform better.

Ad Relevance

Ad relevance uses the same three statuses of Above Average, Average, and Below Average as the expected CTR. Ad relevance measures how closely the content of your ad matches with the keywords you're targeting.

A status of Below Average here can mean that your keywords cover too many topics or they aren't specific enough.

Budget Attainment

Budget attainment is usually overlooked, but it's an important KPI to track. You should always have a marketing budget set in place. In most cases, it's set on a monthly basis.

Budget attainment shows exactly how closely an advertiser came to meet the goals of their marketing budget. This can tell you a lot about the performances of your campaign and your abilities.

Which of the Marketing KPIs Work Best?

There isn't a marketing KPI that works better than the others. They all work as a collective to give you the best return.

Here's an example. You can't run a successful ad campaign that has a high CTR and a terrible quality score. Those two KPIs depend on one another to make the campaign work. If one isn't doing well, the other isn't lagging too far behind.

We can go even deeper by saying that if you improve your CTR, you can improve your quality score. Since your quality score determines whether your ads are relevant and effective, a higher quality score can turn into a better cost per click ratio.

A high cost per click can easily improve both your CPA and CPL depending on the type of ad. These pieces move together. When you put the data that they provide you together, it will assist in making your advertisements whole.

When you focus on one of these pieces at a time, it improves the bigger picture. The bigger picture is your marketing campaign as a whole.

Focus on Making Great Ads

In the beginning, your main focus should be on making the best ads possible. The content of the advertisements will be dependent on the type of company you're trying to draw customers in to.

Many marketers and business owners struggle with finding out how to make their ads convert. Maybe you haven't found your groove yet or you're missing some key pieces of information.

Regardless of what category you fit into, you can gain more understanding and clarity by taking this free training course. It'll teach you how to make profitable ads using social media as a tool.