Which Display Advertising KPIs to Include in Your Reports
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Pathlabs Marketing |
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July 27, 2023 |
Key Performance Indicators (KPIs) are invaluable tools for measuring success and optimizing display advertising campaigns. Selecting the appropriate KPIs to track is more intricate and crucial than many might assume.
In this blog, we will explore the concept of KPIs and delve into their significance within the realm of display advertising. Furthermore, we will discuss the essential KPIs to include in reports and offer strategies to overcome common obstacles. Let's dive in!
What Is a KPI?
In marketing, KPIs (Key Performance Indicators) are metrics used to monitor the success of an initiative or campaign in achieving its goals.
For instance, if the objective is to boost web traffic through a campaign, the marketer can track KPIs such as the number of website visitors, the conversion rate, or the cost per acquisition.
KPIs are used for continuous performance evaluation and are regularly monitored, often on a daily, weekly, or monthly basis.
What Are Display Ads?
Display ads are a form of digital advertising that marketers utilize on various websites, mobile apps, and platforms. These ads typically appear as boxes within the margins, headers, footers, or even between content on a page.
These boxes contain visual elements such as images, graphics, and animations, all designed to promote products or services to a broad or specific audience. When users encounter these display ads, they can click on them, which will redirect them to a different page.
What Are Display Advertising KPIs?
Display Advertising KPIs play a crucial role in helping marketers assess and quantify the success of their display advertising campaigns. These performance metrics provide valuable insights into various aspects of the campaign's effectiveness, allowing marketers to make informed decisions and optimize their strategies.
Some common Display Advertising KPIs include:
Click-Through Rate (CTR)
Conversion Rate
Impressions
Cost Per Click (CPC)
Return on Investment (ROI)
Viewability
Bounce Rate
Engagement Metrics
By regularly monitoring and analyzing these Display Advertising KPIs, marketers can gain a comprehensive understanding of their campaign's performance, identify strengths and weaknesses, and make data-driven adjustments to achieve better results. Ultimately, a successful display advertising campaign relies on setting appropriate KPIs, tracking progress, and optimizing the strategy to deliver impactful and measurable outcomes.
Why Do KPIs Matter?
“Using KPIs in display ad campaigns is important because display is a method widely adopted by marketers, with many investing hundreds to thousands of dollars into these types of campaigns.
Without tracking these KPIs, marketers would be running these expensive campaigns blindly without knowing how they are actually performing or if they are effectively reaching their objectives. ”
By monitoring display campaign KPIs, marketers can continuously check in and assess actual data that aid in identifying trends and making decisions to optimize future performance.
Which Display Ad KPIs to Include in Your Reports
Which display ad KPIs a marketer decides to track is completely of their own discretion. However, they should at least consider and include a selection of the following:
Number of Impressions
Refers to the total count of times a display ad is displayed or viewed by users.
Tracking impressions helps marketers understand the potential audience reached by their display ads and evaluate the campaign's visibility and brand exposure.
Number of Clicks
Measures the total count of times users have clicked on a display ad.
By monitoring the number of clicks, marketers can assess the effectiveness of their ad creatives, messaging, and targeting in driving user interaction and traffic to their website or landing page.
Cost per Thousand Impressions (CPM)
Also called CPM, this quantifies the average cost incurred for every 1,000 display ad impressions.
With cost per impression, marketers can assess the value they are receiving in terms of ad exposure and impressions generated for their budget.
Cost per Click (CPC)
Measures the average cost incurred for each click on a display ad.
By monitoring the cost per click, marketers can optimize their bidding strategies, adjust targeting parameters, or refine their ad creatives to achieve better click-through rates at a more cost-effective rate.
Click-Through Rate (CTR)
Click-Through Rate represents the ratio of users who click on a display ad compared to the total number of times the ad is shown or viewed.
A higher CTR tends to indicate that the ad is resonating with the audience and successfully driving engagement. Monitoring the click-through rate helps marketers assess the relevance and performance of their ad creatives, ad placements, and targeting strategies.
Conversion Rate
Measures the percentage of display ad clicks that result in desired actions, such as purchases, form submissions, or sign-ups.
Tracking the conversion rate helps marketers evaluate the performance of their landing pages, user experience, and overall campaign optimization to improve the likelihood of desired conversions.
Cost Per Acquisition (CPA)
Calculates the average cost incurred to acquire a single conversion or customer.
By tracking the CPA, marketers can optimize their budget allocation, targeting strategies, and ad performance to achieve better conversion rates while keeping the cost per acquisition within acceptable limits.
Return on Ad Spend (ROAS)
Measures the revenue generated compared to the cost of the display advertising campaign.
Monitoring the ROAS allows marketers to evaluate the return on their advertising investment and make informed decisions on budget allocation and campaign optimizations to maximize revenue generation.
Revenue Generated
Tracks the total monetary value generated as a result of the campaign.
Tracking revenue helps marketers assess the effectiveness of their display advertising efforts in driving tangible business outcomes and aligning with overall revenue goals.
Landing Page Views
Tracks the number of times users view the designated landing page after clicking on the display ad.
Marketers can assess the relevance and performance of their landing page design, messaging, and call-to-action by monitoring landing page views to optimize the user experience and drive conversions.
Reach
Reach is a metric that measures the unique number of users exposed to a display ad during a campaign.
Evaluating the reach helps marketers understand the campaign's scope, whether it effectively reaches their target audience, or if adjustments are needed to enhance audience targeting and expand the campaign's reach.
Frequency
Frequency represents the average number of times an individual user has been exposed to a display ad during the campaign.
It helps manage ad fatigue by controlling excessive repetition and ensures the ad makes an impact with sufficient exposure.
Viewability
Viewability measures the percentage of ad impressions that users actually saw.
It ensures effective ad display and engagement, maximizing the impact of the display campaign. Higher viewability rates indicate that the ads are being displayed in visible positions on the webpage, enhancing the likelihood of user engagement and delivering better results for the campaign.
How to Ensure You’re Getting the Whole Picture
Marketers commonly don’t see the “whole picture” of their display campaigns because they make the mistake of selecting the wrong KPIs to track.
To avoid this, we recommend they start from the top and revisit the overall campaign objective. Do they want to generate awareness? Are they trying to make users arrive on a landing page and convert?
Once they clarify this, they should also double-check if display advertising is ultimately the suitable ad method to meet the objective. If so, they can proceed to select the KPI.
The chosen KPI should directly connect to the objective and indicate progress toward it. For instance, if the objective is to drive conversions, tracking metrics like impressions or clicks, which occur before the actual conversion, may not be as meaningful. Instead, focusing on the conversion rate would provide more valuable insights.
“Lastly, marketers must keep the number of KPIs they track limited to those that best represent performance. While numerous display KPIs exist, tracking too many can lead to confusion and distract from what truly matters. Selecting and monitoring a few key metrics will ensure marketers stay focused on the critical factors indicative of campaign performance.
In summary, go back to the objective, find a KPI that directly measures it, and choose to track only the best ones.”
How to Overcome Obstacles and Streamline Your Process
When running display ad campaigns and tracking KPIs, marketers may encounter obstacles; let’s take a look at a few and how to overcome them.
Use Data and Set Realistic KPI Goals
One common obstacle when starting a display campaign is that the marketer knows which KPI to track, but they don’t know the initial KPI range to shoot for. For example, if they want to track click-through rate, it can be unclear if they should initially try and attain a CTR of .50%, .60%, or 1%.
To address this challenge, the marketer should refer to historical data and research available to set the most realistic KPI goal possible.
We take a similar approach at Pathlabs, prioritizing leveraging our wealth of past campaign data to establish a practical baseline. This baseline serves as a starting point.
Then, we can build upon it for future campaigns, continuously monitoring its improvement.
Leverage KPI Tracking Within Platforms
Marketers commonly run display ads through platforms like Google Ads, Facebook Ads, Youtube, and many more. However, the obstacle here is the marketer may neglect that these provide lots of real-time KPI data they can access and view.
It is imperative to acquaint oneself with navigating these platforms and reporting dashboards, knowing how to find and view the KPIs for the campaign. Marketers should also inform themselves on how exactly the platform tracks and calculates the KPI metric. Not every platform does it the same.
Testing and Optimization
One last obstacle marketers may encounter when running display advertising campaigns is their hesitancy to modify them due to the fear of negatively impacting KPI performance. However, marketers must adopt an optimization mindset and be open to some A/B testing and experimentation within their campaigns.
By conducting A/B tests and trying out different tactics, marketers have the opportunity to discover more effective strategies that can yield better results. If a particular tactic doesn't work as expected, the KPI performance data they are tracking will indicate so, enabling them to make informed decisions and pivot their approach accordingly.
In Conclusion…
KPIs are crucial for measuring the effectiveness of display campaigns. Marketers can gain valuable insights into audience reach, engagement, conversions, and revenue generation by selecting the most relevant KPIs that align with objectives.
However, it's important to avoid overwhelming oneself with too many KPIs and focus on the ones that provide the most meaningful data. Overcoming obstacles by leveraging data and platforms and embracing testing and optimization will streamline the display advertising process and improve performance.
