No marketer can survive without data.
In the information age, your marketing strategies do not just rely on thinking and creativity but also on relevant data and metrics. Determining the campaign’s results and understanding the weak points will point you in the right direction.
However, one must combine science and art to analyse and collect all data. Even after collecting, understanding it isn’t a piece of cake. Therefore, most standing businesses use multiple marketing dashboards to get valuable metrics and KPIs.
In a series of metrics and KPIs, there is one helpful to monitor your Ad spend. The Ads are expensive; therefore, analysing their cost and effect is of utmost importance. In this article, we will cover Ad spending. So, let’s begin.
What is an Ad Spend Metric?
The Ad spends metric shows the amount you have spent on ad campaigns. It’s the same for all marketing platforms like Google, YouTube, Instagram, etc. In this metric, you get monitor options. Depending on your business, you can monitor Ad spending annually, monthly, quarterly, weekly, and daily.
It’s a valuable metric not just for knowing Ad spend but also to calculate other factors. Following are some important metrics you can calculate with the help of the Ad spend metric:
- Cost Per Conversion (CPC) = Total Spend/Total number of conversions
- Cost Per Thousand (CPM) = (Total Spend/Number of measured impressions) x 1000
- Cost Per Engagement (CPE) = Total Spend/Number of measured engagements
- Profit = Revenue – Spend
- Ad Rank = Quality score x CPC
As a wise marketer, you must know which metrics are your KPIs. Even if they don’t matter, tracking all metrics is just wasting time. So, use your time wisely by focusing only on metrics useful for the bottom line.
How to Manage Your Ad Spend?
Managing Ad spend is essential because you jeopardize the overall marketing budget once you spend over the limit. So, as a wise marketer, you should learn how to spend wisely. Firstly, the marketing circles usually adopt the 70-30 rule for managing ad budgets. You already know what channels hit your KPIs and produced ROIs using the Ad spend metric. Considering that, you use 70% of the budget on those channels. You should keep the remaining 30% budget for experimenting and innovating new opportunities.
Secondly, divert your attention to ROIs. Rather than focusing on leads only, it would help if you tracked the impact on your revenue. Since a marketer has the challenge to line up each dollar spent with each dollar generated, use customised marketing dashboards to have a real-time view of your businesses. The customised marketing dashboards help you through cost per opportunity/acquisition metrics. It enables you to decide what lead to the final conversion.
In general, there are two ways to track your Ad spend:
- Manual Tracking – Using pen and paper
- Automated Tracking – Using marketing dashboards to manage your Ad spend.
Let’s examine their pros and cons.
- Requires no cost.
- Easy and straightforward to set up; requires no skills but pen and paper.
- Must keep the record on papers.
- Risk of losing the record
- Risk of forgetting to include transactions as the files aren’t always accessible.
- Easy and simple set up
- Immediate and real-time tracking.
- Consumes less space because the records are kept online
- There is a different interface for different electronic devices; iPad, laptop, Android, etc.
- Requires cost.
Why Is Ad Spend Metric Important?
The Ad spends metric gives you a clear vision of what works and doesn’t. Following are the three ways Ad spend metric can help your marketing businesses:
- The Ad spending metrics help you create conversion-boosting ads and posts. Ad spends metrics help you understand what kind of posts or content are working and what aren’t. If a particular ad or placement isn’t attracting conversions, then you should probably bring a change.
- The Advertising spends metrics to improve your ROIs by helping you create highly-converting ads at lesser prices. All social media platforms have different audiences, having unique patterns of likes and dislikes. For instance, when you understand what type of ads work for Facebook audiences, you are more likely to get a conversion and improve your ROAS. Knowing the psychology of your audience improves your ROAS much better than any other thing.
- Last but not least, it helps you achieve a specific goal because you can use it to set up a benchmark of specific results. By analysing today’s conversion rate, you can work to improve it for tomorrow. They help you create better outcomes for tomorrow by providing insights into today.
Does Your Company Need a Marketing Dashboard?
As mentioned earlier, surviving in the information age without consistent data is a hard nut to crack. So, yes, the marketing dashboards are valuable because they provide a consistent report, including all data. You can optimise your decisions and create a better tomorrow for your company using these reports.
For example, you can analyse each penny spend on the Ad campaigns using the marketing dashboard’s ad spend metric. Plus, it provides a real-time view of the return on the Ads. Thus, helping you understand what content attracts conversion and requires your immediate attention and what is just a waste of money. A well-customised marketing dashboard points you in the right direction, informing you which decisions were correct and which were wrong.
Blind spending on Ads may push you to the verge of bankruptcy. Allotting budget to non-converting ads costs you your cash and your time spent on designing them. Therefore, almost all successful businesses use the Ad spend metric to know precisely how much they spend on Ads.
Apart from the Ad spend metric, you will find numbers of others helping you dig solid pillars for your business. If you are going to use all of them, it would be best if you used only those that are useful to your business. If you ever need to create a customised dashboard, know that Powermetrics are the best in this field.