What is digital marketing? A quick review of 5 common advertising indicators

There are many applications of digital marketing, did too many professional terms make you feel dazzled? Today, we have listed five digital advertising indicators which are commonly used for you, allowing you to master digital marketing strategies easily and facilitate your operations.

1. 1. Click-Through Rate
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Divide the number of clicks by the number of impressions on your advertisement to get your ad's clickthrough rate. This ratio shows how often each user clicks after seeing your ad or product information.

Suppose your ad has been exposed 100 times, clicked 10 times by Internet users, and the click-through rate is 10%:

10/100 X 100% = 10%

We can evaluate the performance of keywords and the content of the advertisements through click-through rate. A high click-through rate shows that more people have viewed your ad and find your ad and product information useful and relevant, which can generate more traffic to your website. If the click-through rate is low, we need to modify the relevant keyword or product information immediately, otherwise, it will affect the ranking of the ad.

1. 2. 2. Cost Per Clicks (CPC)
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   The maximum CPC bid price is a bid that you set to determine the highest amount that you are willing to pay for a click on your advertisements. Cost per click (CPC) is the final amount you are charged for a click which is usually lower than the maximum click bid.

    

   Assuming that the actual CPC is $2 and there are 10 clicks for your advertisement, then the total cost is 2 X 10 = $20. The CPC reflects the price of the advertisement in the prominent position of the Google search. Ads displayed above the search results have a higher click-through rate, and most actual CPCs will be higher than the ads that appear below the search results.

3. 3. 3. Cost Per Mille (CPM)
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   Cost-per-Mile means that you pay for every thousand views of your ad. This promotion method greatly increases the exposure rate of advertisements for products, allowing users to have more opportunities to reach the advertisements for related products, and the brand's popularity can be rapidly increased.

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It should be noted that CPM only counts the number of impressions, not the click-through rate. Therefore, this promotion method cannot directly attract consumers to take actual actions, such as browsing the brand's website. The brand needs to take this into consideration when choosing to use CPM or CPC.

4. 4. Quality Score
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Quality score is measured by Google according to the advertisement content and quality which is evaluated on a keyword-level scale of 1 to 10. The Quality Score is a combination of three elements: expected clickthrough rate (CTR), ad Ad relevance, and landing page experience. A higher quality score means your ad content and landing page are relevant and useful to your users.

Generally, ads with higher Quality Scores will be able to grab a higher ad position in google search. Therefore, reasonable click bidding and high-quality advertising content will affect the exposure opportunities of advertising.

5. 5. Conversion Rate (CVR)
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The conversion rate is the number of conversions after a user clicks an ad, calculated as the number of ad conversions / the number of ad clicks. If your ad is clicked 1,000 times, and 40 users browse the website. The conversion rate is 40 ÷ 1,000 = 4%.

Here is the case. If the CTR is 20%, but the conversion rate is only 0.5%. Then the problem is not the advertisement itself, because the advertisement has already brought pageviews to the brand website. The problem comes from the website operation or design of the brand, which makes consumers less willing to buy. Get a clear understanding of the problem and adjust your online marketing strategy in real-time to get the best results from your sales promotion plan.

Bigwave Media will always be your digital marketing partner, with the spirit of “Professional, Customer First & Trend Following”, helping you keep moving forward by offering wave after wave of digital marketing solutions!