KPIs for Digital Marketing | How to Evaluate Your Marketing Performance
Рет қаралды 118,749
Күн бұрынWe are going to break down the most important KPIs for digital marketing. I will teach you how to evaluate marketing performance for each individual channel and for your overall business & marketing funnel. Template & dashboards included.
► Part 2: Performance Marketing (Conversion-Based Marketing): • Performance Marketing ...
► Part 3: Building a Growth Marketing Dashboard: • Marketing Dashboard Tu...
✅ Download the Excel template: bit.ly/mktgKPIs_mlchmp
🚀 If you want to master the finance skills & frameworks to successfully scale technology startups, secure your spot in my "Finance for Startups" program, today: www.ericandrewsstartups.com/f...
Communities:
💼 Linkedin: / eric-andrews-1624b656
☑️ Twitter/X: / eric__andrews
🌟 Instagram: / ericandrews_startups
🔥 Discord: bit.ly/discord_eric
💻 Newsletter: bit.ly/joinericnewsletter
🎥 Clips: / @ericandrewsclips7818
Related Digital Marketing Videos:
🚩 Playlist - Tracking Digital Marketing Performance: • Tracking Digital Marke...
▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬
In this video, we will learn how to understand the performance of each marketing channel as well as the performance of our overall marketing funnel using digital marketing KPIs.
We will build simple marketing dashboards that can be used in real life, as well as look at some case studies and talk about common pitfalls.
I've seen many times battles within companies to cut marketing spend from one channel to add to another, only to have these reallocations backfire and the performance ends up being worse than before. Why?
Because digital marketing performance is hard to understand if you aren't using the right KPIs, focusing on overall blended CAC, and thinking about the overall marketing funnel.
It is very easy to oversimplify marketing performance and make poor decisions about what is working and what is not.
We will cover all of this using real-life examples and discussions.
SECTIONS:
0:27 goals for evaluating digital marketing performance: CAC vs. LTV
1:20 who this video is for
1:49 explanation of the marketing funnel (top, mid, bottom)
5:20 what is customer acquisition cost (CAC) & why is it important
6:37 differences in CAC between parts of the funnel
7:46 case study e-commerce: common pitfalls when allocating ad spend
9:07 paid digital marketing dashboard
14:43 paid vs. organic vs. blended customers
15:13 overall digital marketing dashboard (blended)
17:53 recommendation for budget allocation to top vs. bottom of funnel
18:58 what is a good CAC & how much can we afford to spend on marketing?
19:34 customer lifetime value example - LTV vs. CAC case study
By the end of this video, you will understand the most important KPIs for evaluating digital marketing in real-life situations.
#digitalmarketingKPIs #startups #marketingperformance
@eric_andrews 3 жыл бұрын
This was my first video focused on marketing. Curious - what did you think? Do you want more? Also, don't miss my new video on Startup Metrics & KPIs ► kzfaq.info/get/bejne/qtuIfK-kutLOe5c.html
@oluwatosinagboola2904 Жыл бұрын
Hi
@oluwatosinagboola2904 Жыл бұрын
Please I Have A Question For You
@Bekind757 7 ай бұрын
Thanks you so much..
@LennyYT Ай бұрын
Yes! Moooore🎉
@syedjawaadali9841 6 күн бұрын
You nailed it bro! All covered in 23 minutes. Kudos!
@sarahaljuaidi2046 2 жыл бұрын
This video just answered all my questions about KPI. Thank you Eric!
@jyotsana4266 Жыл бұрын
Really appreciate the effort you have put in explaining the concepts in your videos. Very good quality content that's extremely helpful in my current role. Good luck !
@favourebubechukwu3592 2 жыл бұрын
This is very insightful and so well explained. Well done !
@mohamednasser1407 2 жыл бұрын
Thank you soooo much, I'm starting a position as a junior performance marketer and I didn't understand anything about marketing! Thanks to your thorough videos I'm finally on the right track, please keep it up!!
@TheManx1996 Жыл бұрын
Killer video Eric. Great content. You've earned yourself a subscriber!
@md.ashiqulislam5927 Жыл бұрын
This was really helpful. Thanks for putting these together.
@ZKBeatz07 3 жыл бұрын
This is awesome stuff man because you break everything down to the essentials, I've recognised that this is the main skill that smart people use to differentiate themselves from the average ones, keep rolling!
@eric_andrews 3 жыл бұрын
Appreciate that and really glad this video distilled this stuff down for you 😎...more to come !!
@heathergray7538 2 жыл бұрын
I needed to hear this, thank you, fantastic!
@TremaineRaisa 2 жыл бұрын
Hi Eric! I've binged a couple of your videos today and absolutely have to say thank you so much for this info! You're really breaking down these concepts into bite sized pieces and its really valuable. Thanks!
@eric_andrews 2 жыл бұрын
My pleasure I'm glad they're valuable for you
@ferasalnaser8142 Жыл бұрын
I have a small question though, in your video you showed Paid Revenue and Paid Purchase. What is the difference between both ?
@PierreLaRRRR 3 жыл бұрын
This was fantastic! Exactly what I needed, thank you. Subscribed!
@eric_andrews 2 жыл бұрын
Awwwesome! That's what I like to hear
@juanacevedo5824 2 жыл бұрын
New to the channel. You are gifted at making this videos easy to digest. Keep them coming.
@eric_andrews 2 жыл бұрын
Appreciate the comment! Will do, working on my next video tomorrow
@ChiChi-sw5iu 2 жыл бұрын
This is one of my favorite channels 😌
2 жыл бұрын
You are amazing! Content is amazing! Thank you!!
@syedjawadhasan661 Жыл бұрын
Excellent. Thank you so much
@nev0116 4 ай бұрын
You explained this so well thank you!
@eric_andrews 3 ай бұрын
Glad it was helpful!
@spalding1495 2 жыл бұрын
Thank you so much for this - I did a lot of digital marketing (and 4+ other roles) for a small shipping container business but given the variance in prices and over-the-phone final sales it was difficult to quantify things. For example, how to label a final sale as paid, organic, or blended and from what channel, level of the funnel, etc., making it hard to express the value I brought in current interviews. I'm crushing interviews now and am much better at quantifying what exactly I did and am able to do. Thank you!
@elijahgabalda1278 3 жыл бұрын
Hi Eric! Amazing content. I love the case study portions of this video. Extremely informative! Can you have more Strategic Marketing related content? Would love to see these kinds of videos from your channel! :)
@eric_andrews 3 жыл бұрын
Hey Elijah, thanks and glad it was valuable! I can definitely create more content on the performance marketing side. My background is in finance as well as growth marketing so I'll try to teach more marketing going forward, thanks for the suggestion 😎
@morningcoffee1111 Жыл бұрын
Excellent video. Exactly what I wanted and perfectly explained. Instant subscribe.
@eric_andrews Жыл бұрын
🙏
@seda4338 2 жыл бұрын
Thank you, it was really helpful
@MadaMarquesAbreu 2 жыл бұрын
Very very useful! Looked into it because have a maketing interview for a new job coming up and needed to brush up in some topics! Hope I get it! Thank you for the help
@eric_andrews 2 жыл бұрын
Hope you get it, cheers!
@Unnamed111-l5z Жыл бұрын
this video was extremly usefull for me! It was absolutely the best what I have seen aboutthis topic!
@eric_andrews Жыл бұрын
You're very welcome!
@alyssanguyen8190 3 жыл бұрын
Thank you for your shaing. Your video is so helpful to my business
@eric_andrews 3 жыл бұрын
I'm really glad to hear that Alyssa thanks for leaving a comment to let me know !!
@wilsonmoscoso4620 Жыл бұрын
Thanks Eric for this great video.
@eric_andrews Жыл бұрын
Glad you enjoyed it!
@Bluesky-cg1ug 2 жыл бұрын
Thanks Eric
@swiftismymum4544 2 жыл бұрын
well-explained thanks
@Riosbjj Жыл бұрын
excellent job man.
@vascostudio 3 жыл бұрын
Great video! thanks a lot
@marimari0003 8 ай бұрын
thank you
@yuniakaminska5385 Жыл бұрын
Brilliant explanation, thank you!
@eric_andrews Жыл бұрын
I'm glad to hear it was helpful!
@varunpadmanabhan6101 Жыл бұрын
Thank you!
@eric_andrews Жыл бұрын
You're welcome!
@mattbrattin 3 жыл бұрын
Great breakdown here, very clear.
@eric_andrews 3 жыл бұрын
Glad it was helpful Matt. Appreciate the comment
@pjnyc8276 3 жыл бұрын
Excellent content, thank you!
@eric_andrews 3 жыл бұрын
Happy to help!!! 😀
@ardodheo94 3 жыл бұрын
very helpful thanks
@franklinbmedia5170 2 жыл бұрын
Really amazing content
@jamesmulvihill8526 Жыл бұрын
Amazing video!
@eric_andrews Жыл бұрын
🙌
@raziasehat1918 2 жыл бұрын
Thank you so much Eric
@eric_andrews 2 жыл бұрын
you are very welcome
@cherrypiemtl7823 3 ай бұрын
This was great content I learned a lot!
@eric_andrews 3 ай бұрын
Very welcome!
@revivelifewithme Жыл бұрын
Thank you so much for sharing valuable information and calculations to evaluate digital marketing performance. I have enrolled for marketing certification, and your videos are helping me more than the textbooks provided by the online university. Thank you 😀.
@eric_andrews Жыл бұрын
I love to hear it, you're very welcome!!
@vikramlinganna4988 2 жыл бұрын
Excellent Video Eric.
@eric_andrews 2 жыл бұрын
Cheers vikram!
@davidK2323 3 жыл бұрын
Great Video! Thanks!
@eric_andrews 3 жыл бұрын
Cheers David, glad to hear it 👍
@antheacarlyncaro3216 6 ай бұрын
So happy I stumbled upon you channel! This is really good content and you've done so well with demystifying marketing buzz words!
@eric_andrews 6 ай бұрын
Glad to hear it 🙌
@sonerguney3225 Жыл бұрын
You are very good
@DigitalMarketingAndMore 11 ай бұрын
very good
@happyiglu 2 ай бұрын
Nice video!
@lilyb2617 Ай бұрын
Very helpful thank you as no one has explained that to me before and I’ve made that Google mistake!
@eric_andrews Ай бұрын
😎🙌 awesome!!
@jninlove 3 жыл бұрын
Thanks for the informative video~
@eric_andrews 3 жыл бұрын
Happy to help Grace 👍
@mdshahidul2181 2 жыл бұрын
Osom video
@khaldoun6260 3 жыл бұрын
awesome video .. thanks alot
@eric_andrews 3 жыл бұрын
My pleasure, glad it was valuable Khaldoun!
@keyspanmusic 3 жыл бұрын
KPIs all day! 🙌💯
@eric_andrews 3 жыл бұрын
What gets measured gets managed!
@shamailajaved8027 Жыл бұрын
Hi Eric, Thanks for the great video. Very well explained. Could you please make more videos on other KPIs. I have a small question though, in your video you showed Paid Revenue and Paid Purchase. What is the difference between both ? As far as I understood, Paid revenue is the dollar amount I earned with my paid Ads and Paid purchases are in terms of quantity (how many were sold in total). Am I correct? Thanks
@hoturasu 2 жыл бұрын
Thankyouuu so much!!!@
@eric_andrews 2 жыл бұрын
You are very welcome
@Damian-rq3dj 3 жыл бұрын
Thanks! This is my first video and I already know I'm gonna love this channel. The only thing that I'm not sure here is if the general LTV is the best metric considering that cashflow is crucial for ecomm businesses. Maybe 60 day LTV would be better?
@eric_andrews 3 жыл бұрын
What's up Damian!! For cash flow you need to build an actual financial model with all expenses and this channel is absolutely packed with financial modeling videos 😅. The LTV will just tell you if you are acquiring customers that you will eventually make money on, but to calculate those up front losses you'll need to build a full financial model. Check out my e-commerce financial model, marketplace financial model, and three statement financial model and you'll be a pro 👍
@Damian-rq3dj 3 жыл бұрын
@@eric_andrews I will, thanks!
@marynaksendz46 2 жыл бұрын
Content aside, I just love his voice:) How about running a podcast? I'd listen))
@eric_andrews 2 жыл бұрын
😊 that's an awesome idea!! I will think about it
@LennyYT Ай бұрын
Awesome 🎉 how do you figure out how much time a customer needs for coonsideration and how to best track it? 🙏
@sylwianehring8677 Жыл бұрын
Hi Eric, great video :) I have a question - where do you take the data for Google and FB from (Spend, Revenue etc.)? From Google Ads and Facebook Ads panel or Google Analytics?
@riccardoa150 3 жыл бұрын
Hey Eric, do you mind going over a simple LBO model?
@sachinsawant7114 Жыл бұрын
This seems to be good but I suggest you, how about adding few more metrices like cpc or ctr and impressions etc. This help in understanding what ratio we can expect while running a ad on top funnel or bottom funnel irrespective of market place like facebook or Google.
@eric_andrews Жыл бұрын
Hey yes 100% agree those are also very important I have another video that gets more into paid ad metrics here: kzfaq.info/get/bejne/gMuPps9pvrrOn4k.html And I go deeper on combining all of the metrics between those two videos into a marketing dashboard that you could use in a weekly growth meeting here: kzfaq.info/get/bejne/gbuIlbKrzLK5j6c.html Hope that helps!
@xinhk Жыл бұрын
Hi Eric, thank you for this information, it was so clearly explained and I enjoyed learning from you. I have a question - when you work out the AOV and average frequency of purchase, do you typically omit outliers and only include those within 75th percentile etc?
@eric_andrews Жыл бұрын
I think it depends a bit. If I was just selling one product or a similar bundle of products all the time I would just take the overall average. But if you have various product lines with different marketing funnels and products (with different price points) sometimes I would look at AOVs and marketing data separately. Have to use your best judgement.
@shishiwassef 2 жыл бұрын
Hey, I loved your video! Just a quick question: how do you define a Lifetime purchase? How long is lifetime? and with campaigns which normally run for like 4-6 weeks, how can you calculate that kind of formula? Thank you!
@eric_andrews Жыл бұрын
You're welcome! Lifetime is just the average amount of time that a customer continues to actively make purchases. For some businesses customers just purchase one time and for some businesses customers purchase for years, you have to look at your customer purchase data and cohortize it to understand it. Check out some of my videos on customer retention and customer lifetime value and we go into it in a lot more depth. The main thing you want to measure when you have a marketing campaign is the customer acquisition cost, separately you need to understand what your customer lifetime value is and then compare them to each other. The specific length of your campaign is basically irrelevant and unrelated to lifetime value.
@jindapornasairat2087 Жыл бұрын
Thank you so much for the video. It is super useful and it helps me so much!. I have a bit of a question. How do you identify which customers come from which channels? I am having a hard time tracking this.
@eric_andrews Жыл бұрын
It's not easy anymore now that data tracking is getting more restricted. The best place to start is looking at the last click conversion data in Google analytics, that is at least a starting point. Make sure use are using UTMs on any paid campaigns so you can track them. Each channel you may have to track a little differently though. I made a new marketing dashboard video about a month ago that should help you! kzfaq.info/get/bejne/gbuIlbKrzLK5j6c.html
@menhaj1 2 жыл бұрын
this is very informative, I was wondering if you can advise on the freemium business model and how do we calculate the value of free users
@eric_andrews 2 жыл бұрын
just look at what % of your free users convert into paid and what those paid users are worth over their lifetime. If 1 out of 20 freemium users converts to a paid user worth (for example) $300 in gross profit over their lifetime, then a freemium user is worth $300 / 20 = $15. That would be how much you can invest in marketing to get a free user.
@nikong9789 2 жыл бұрын
Super insightful!! Thank you. May I know how would we be able to best source for lifetime purchases information?
@eric_andrews 2 жыл бұрын
Customer orders!
@user-rx7mf1ck5j 3 жыл бұрын
you explained it so easily, i easily understood with almost with no knowledge on marketing. as a beginner (i have a degree on international business) what topics should i study to apply for a job as a digital marketing agent in the future? thank you in advance
@eric_andrews 3 жыл бұрын
Hey - I'm really glad to hear this video got you interested in marketing. I work as a growth marketer as well as in finance, and honestly I think there are more job opportunities in digital marketing than finance, and it's also a really fun industry. If you're starting as a beginner, you need to learn about all the different areas of digital marketing first because you'll ultimately be focusing on one specific thing (for example, some people focus on search engines, some people focus on paid advertising, some people on email marketing, etc). Here is an incredible free article (sort of like an ebook) that covers basically all of online marketing, I suggest you sit down for a few hours and read the whole thing to learn about how it all works and where you might want to focus: www.quicksprout.com/the-beginners-guide-to-online-marketing/ I personally run paid ad channels like facebook and there are lots of online courses & videos on each area of marketing. Anyway, so I'd start by reading that guide and you can decide from there where to dive into next. Cheers
@user-rx7mf1ck5j 3 жыл бұрын
@@eric_andrews thank you!!!
@eric_andrews 3 жыл бұрын
@@user-rx7mf1ck5j you're welcome!
@MrTHEGODSPEED 2 жыл бұрын
Thankyou, can you bring entire series on Marketing analytics please?
@eric_andrews 2 жыл бұрын
Let me think about this.... getting a lot of requests and would probably be pretty fun
@MrTHEGODSPEED 2 жыл бұрын
@@eric_andrews yeah it would be so
@Ferrari-f40 2 ай бұрын
Hi Eric, amazing video!! I had a question, if i want to start a marketing agency, is your digital marketing series enough to cover the basics of tracking metrics etc, ? (Not including Google seo, I just wanna know how to track marketing campaigns on social media)
@eric_andrews 2 ай бұрын
Hey! I think the series is definitely enough to get started and build the types of dashboards your clients would like. Obviously each platform is sort of a rabbit hole so some clients might want additional metrics around facebook ads, etc (like CPM, CTR, CVR, or different attribution windows, or ad-level or ad set-level metrics), but in general yes these will definitely get you off to a good start.
@Ferrari-f40 2 ай бұрын
@@eric_andrews Thank you so much!!
@hannahgodfred1797 3 жыл бұрын
would you be willing to share this spreadsheet, its excellent!
@eric_andrews 3 жыл бұрын
It's right there for free in the description 👍
@LennyYT Ай бұрын
What youd suggest if the ecommerce sells single iitems ans in bulk, which would demand a more relationship to build?🙏
@monikajankauskaite4522 2 жыл бұрын
Loved the video, thank you!! But one thing I can’t get my head around is paid revenue from Fb. If like in this example we use Fb ads for the top funnel, that brings google clients who then convert, how do we calculate the revenue from Fb when it’s used for the top funnel, not to convert the clients? Hope that makes sense?
@eric_andrews 2 жыл бұрын
Sure, so in general revenue is calculated on either a "first click" or "last click" attribution. Meaning, we give revenue credit to either the first place the customer interacted with our brand, or the last. These days we are relying more on last click because of the user tracking issues. So if we are using last click, facebook will have some conversions, but google would have a lot more per dollar spent on ads. Depends on the product as with some things facebook can convert pretty well even at the top of the funnel, especially for cheaper products. Hope that helps.
@monikajankauskaite4522 2 жыл бұрын
@@eric_andrews makes sense, thank you!
@ferasalnaser8142 Жыл бұрын
Dear sir, can you share this Excel sheet? Many thanks about this interesting content
@eric_andrews Жыл бұрын
Yes it's available for free download in the description
@mangowolf5 3 жыл бұрын
Hi Eric, great video. So does all marketing just depend on LTV at the end of the day? As CAC would be useless without knowing LTV?
@eric_andrews 3 жыл бұрын
That's exactly right. You got it
@mangowolf5 3 жыл бұрын
@@eric_andrews would this mean that CAC or other KPIs like CPA should not be used to assess marketing campaigns? or would there be instances where CPA should be focused on?
@eric_andrews 3 жыл бұрын
@@mangowolf5 No, CPA is by far the most important metric for marketing. But first you need to understand your LTV to understand what an acceptable CPA target is. From there, CPA is everything once you have defined what you can afford. For example, if LTV is $150, we know CPA absolutely must be lower than $150, but we may have more specific targets like 1/3 of LTV or $50 CPA.
@shashiv6822 2 жыл бұрын
@@mangowolf5 CPA is actual one of high priority marketing KPI. CPA is different for a B2B than ecommerce. There are lot thing come into play when hit saturation point of market. CPA would change exponentially. Especially for higher ticket B2B service it is very complicated to predict actual CAC when are competing against well established market who are already solution aware and top vendor they have on thier priotiy list. Marketing much more complex than formulas.
@ahmedtalha1355 Жыл бұрын
Hello Eric do you have LinkedIn profile to connect more ?
@prisciliasalinas7436 2 жыл бұрын
The video is amazing and I got most of the info very easy, but I got confused in the Blended CAC calculation, because you are saying you have to take the total new clients and then divide by total spend, but google says you have to take the total spend and divide it by the total customers acquired, so is backwards and it made me very confused. I am new in all these and that particular part is what confused me so much. But is very good overall.
@eric_andrews 2 жыл бұрын
Hi Priscilla, so there are a few ways to calculate the blended CAC, the best way always depends on the situation. The reason we like paid CAC is because usually most of our marketing spend is directed towards getting new clients so it gives us a metric to measure how expensive that is for us over time. For a business that gets all of its sales from people buying for the first time (once and never again) then Google's way or this way would give you basically the same number. But if you were a company that had 80% of its sales coming from repeat customers, and all your marketing was focused on getting new customers, then it doesn't really make sense to include those repeat customers in your CAC because your marketing spend was not focused on them. Anyway, you can do it different ways, there is no right / wrong. Hope that helps.
@anasjumaa4435 Жыл бұрын
This is amazing, can I have the file?
@eric_andrews Жыл бұрын
Sure it's right there in the description for free
@duncanmahood2878 3 жыл бұрын
Don't neglect the top of the funnel!
@eric_andrews 3 жыл бұрын
That is exactly right Duncan!
@mikeselldigitalconsulting3847 3 жыл бұрын
Hello - I am looking for marketing funnel performance bench arks for law firms (From visitors, to leads, to MQL to SQL to clients). are you familiar with such benchmarks? Thank you.
@eric_andrews 3 жыл бұрын
Hey - so these metrics are more oriented towards technology businesses instead of service businesses, but I would recommend you look at the google keyword planner and research some searches related to "law firm" to see what the CPCs (cost per clicks) are, that would give you a good starting point on the cost of paid traffic, and you could probably assume a conversion rate and try to estimate CPA from there. Hope that helps!
@standforfreedom5857 2 жыл бұрын
If the Ltv already factors a gross profit margin in, wouldn’t taking the difference between the Ltv & CAC be double counting the Cac? The advertising & other customer acquisition costs will be part of the primary expenses for an e-commerce business so Cac will Already be accounted for in the gross margin. I guess if a certain company includes advertising as SG&A expense then your method would make sense but if not we should be starting with pure revenue right? Am I thinking about this correctly or where am I of?
@eric_andrews 2 жыл бұрын
No, CAC is not included in the gross margin. Marketing costs always go in the operating expenses, that's an accounting rule. So it is not double counting.
@eric_andrews 2 жыл бұрын
🚨 Who's interested in being a part of my Finance for Startups program? www.ericandrewsstartups.com/financeforstartups
@ferasalnaser8142 Жыл бұрын
I have a small question though, in your video you showed Paid Revenue and Paid Purchase. What is the difference between both ?
@eric_andrews Жыл бұрын
Sure, that is just revenue and the associated purchases that you are able to prove came directly from paid advertising...a lot of purchases come from "organic" or free activities like word of mouth, so you want to try to differentiate where possible.
@bigtimesites 2 жыл бұрын
Eric can you please tell me how to know how much content to create per clients budget and how often to release it? If for instance a client comes to me with $1,000 budget per month and asks me to create a marketing plan and tell him how many Instagram posts, Facebook posts, PPC ads and SEO articles i can provide for him and how often will they be released. How can I possible come up with that strategy? No one ever talks about that in any videos. I need to build a template for that plan for a client and still account for my profit. And this question would apply the same way for a $5,000/mo client or $10,000. I need to have a content count and release duration strategy. Is this some kind of secret or is there a formula or what? Do you know of videos or courses that discuss this in detail? Thanks.
@PriyamvadaGoel 2 жыл бұрын
Hey there Eric! I've been finding your videos very helpful and I'm looking forward to more of them. Just to be sure I understood correctly, could you confirm this please? Thank you! Say, A - No. of new paid customers B - No. of new organic customers C - No. of returning paid customers D - No. of returning organic customers and R(A) - Revenue from new paid customers R(B) - Revenue from new organic customers R(C) - Revenue from returning paid customers R(D) - Revenue from returning organic customers Paid ROAS = {R(A) + R(C)}/ Total ad spend Blended ROAS = {R(A) + R(B) + R(C) + R(D)}/ Total ad spend Paid CAC = Total ad spend / A Blended CAC = Total ad spend / (A + B)
@eric_andrews 2 жыл бұрын
Not quite, but great to see you digging in to this most people don't take the time. Paid roas is paid rev / ad spend Paid cac are ad spend / paid purchasers Blended roas is all rev / ad spend Blended cac is ad spend / all purchasers If you run ad accounts (FB / google, etc) you would see they report out their own "conversions" and "rev" so that is what you consider the paid part.
@PriyamvadaGoel 2 жыл бұрын
@@eric_andrews Thanks a ton Eric. This is the information I was looking for - "If you run ad accounts (FB / google, etc) you would see they report out their own "conversions" and "rev" so that is what you consider the paid part." I guess it will bring more clarity once I work on these numbers for real. However, the formula you used for CAC calculations in the excel sheets is ad spend / purchases and not purchases / ad spend. Also the term 'new' is vital to CAC calculations right? So paid CAC would apply to paid NEW customers and Blended CAC would apply to organic NEW + paid NEW customers. Is that right?
@eric_andrews 2 жыл бұрын
@@PriyamvadaGoel Sorry, I was writing that previous comment too fast and swapped the data. I corrected it just now and yes to all your questions. CAC is just the average marketing cost per customer, just conceptualize that idea rather than focusing too hard on the formulas.
@PriyamvadaGoel 2 жыл бұрын
@@eric_andrews Right. Thank you for taking the time to address the queries Eric. Appreciate it. :)
@Jzguan 2 жыл бұрын
Pro
@eric_andrews 2 жыл бұрын
💯
@maryjoygromia6643 8 ай бұрын
Where did you get the paid purchase?
@eric_andrews 8 ай бұрын
From your tools like the Facebook Ads Manager and Google analytics. It's significantly less accurate now since 2021 when Apple released iOS 14 and started restricting the ad platforms ability to collect data
@JayanVarghese 2 жыл бұрын
Is Facebook a good TOF channel for a product like office furniture. Isn't Furniture searches intent driven? Wouldn't customers find us more on Google more and less on FB?
@eric_andrews 2 жыл бұрын
Probably google would make more sense, but with google you are limited to the number of people searching. With office furniture facebook probably wouldn't be a great tool, but with other types of furniture or other consumer goods facebook can be a great way to get in front of people who fit certain demographics / interest groups if you can get the creative right
@BlesseDana Жыл бұрын
Customer Acquisition Cost is how much we spent to acquire ONE new customer?
@eric_andrews Жыл бұрын
Yes
@carlodandrea9898 2 жыл бұрын
What about when you can't exactly break down what has come from Facebook ads or Google ads??
@eric_andrews 2 жыл бұрын
You gotta depend a lot on Google analytics right now, it's all last-click but it still gives you a decent idea. Also a good test to do is to pause your Facebook ads for a few days and see what the impact on your revenue is. The post iOS 14 world is really tough
@omerk2534 5 ай бұрын
Really good video , thanks !
@eric_andrews 4 ай бұрын
You are welcome!
@iberoamericano6904 2 жыл бұрын
very good
@eric_andrews 2 жыл бұрын
Thank you! Cheers!
Eric Andrews
Рет қаралды 58 М.
Senator We Run Ads
Рет қаралды 104 М.
Google Career Certificates
Рет қаралды 57 М.
Tim Ferriss
Рет қаралды 1 МЛН
The Knowledge Project Podcast
Рет қаралды 417 М.
Eric Andrews
Рет қаралды 15 М.