A metric for every stage: CPM, CTR, CVR, CPA, ROAS

7 minutes · 10 steps · workout 6 of 6 in this module

What you'll be able to do

By the end of this workout, you'll be able to calculate CPM, CTR, CVR, CPA, and ROAS, and read from the numbers which stage of a campaign is getting weaker.

A first look: Warm-up: Every stage has a report card

Every funnel stage has its own metric. Awareness: CPM, the cost of 1,000 impressions (spend ÷ impressions × 1,000). Interest: CTR, the percentage of people who saw the ad and clicked (clicks ÷ impressions × 100), and CPC, the cost per click (spend ÷ clicks). Conversion: CVR (conversions ÷ clicks × 100) and CPA, the cost of one conversion (spend ÷ conversions). Profitability: ROAS (revenue from ads ÷ ad spend).

What this workout covers

Warm-up: Every stage has a report card
One campaign, five metrics
Case: Which ad set gets the budget?
Module complete: Which link broke?

A question from this workout: Which ad set gets the budget?

Northpack is testing two ad sets on Meta for the same backpack. Set A is a colorful, funny video. Set B is a simple product video that shows the inside of the backpack. After one week, you need to decide which one gets an extra $600 in budget.

Both sets · spend: $600
Both sets · impressions: 62,500
Set A · CTR / clicks: 3.2% / 2,000
Set A · orders: 16
Set B · CTR / clicks: 1.2% / 750
Set B · orders: 30

Where do you put the extra $600?

Set A. Its CTR is almost three times higher, so people love this ad
Split it evenly. Give both sets a chance
Stop both and shoot a new video
Set B. It brings in orders for less

Pick your answer first, then open the reasoning below.

Show the answer and the reasoning

Answer: D. Set B. It brings in orders for less

A's CPA is $600 ÷ 16 = $37.50. B's is $600 ÷ 30 = $20. A gets lots of clicks, but the people who click don't buy (CVR 0.8%). With B, 4% of the people who click buy. Picking A because of its CTR is the most common mistake: clicks don't make you money, orders do. Shift the budget to B step by step and keep an eye on CPA.

The other steps work the same way: you decide first, then see why each option is right or wrong.

How you practice here

3 short concept cards
2 multiple-choice questions
1 campaign case with real-looking numbers
1 matching exercise
3 guided calculations

Part of the module: The Marketing Funnel

The journey that turns a stranger into a customer, and a customer into a loyal fan, plus the metrics that measure each stage.

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Programs that include this workout

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