April 30, 2004

(Continued)

What to do with all that data
To calculate your total ROI from that campaign is relatively easy. The simple math formulas below will guide you step by step:

The ad revenue is the amount your campaign earned, after all your advertising costs have been determined.

     The math formula is Revenue minus Ad Cost

Your CPA (Cost per Acquisition) is the amount of money you actually spent to get each sale in your campaign:

     The formula is Ad Cost divided by the Number of Sales

Your final ROI is the actual profitability of your ad campaign, based on a percentage:

     The formula is Ad Profit divided by Ad Cost multiplied by 100

Important notes
One word of advice: in an ideal online advertising campaign, it is strongly recommended to include all ad listings (in your titles and descriptions) and your landing pages if you happen to analyze more than one product (or more than one keyword). Failing to do that could generate reports that could be useless to you, since there won’t be any accurate way of tracking which ad sold which product.

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Article written by Serge Thibodeau,
President & CEO,
Rank for $ales
Copyright (c) Serge Thibodeau 2004

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