Curious to know if the money you’re spending on ads for your online store is helping your business grow? This guide will explore everything you need to know about measuring and optimizing your ad performance. We’ll look at important numbers that tell you if your advertising efforts are paying off. By the end, you’ll know exactly how to tell if your ads are worth what you’re spending on them.
Before we get into complicated stuff, let’s talk about the main numbers every online store owner should keep track of:
This tells you how much money you make compared to what you spend on ads. For example, if you spend $1 on ads and make $4 back, that’s good! We call this a “4 to 1 return.”
This is all the money your ads helped you make from people buying your products. It’s important because it shows you the real money your ads brought in.
This shows how many people see your ad and actually click on it. If lots of people are clicking, it usually means your ad is interesting to them.
This tells you how much you pay each time someone clicks on your ad. Knowing this helps you make sure you’re not spending too much.
What’s considered “good” performance varies by industry. Here are some general benchmarks:
Remember that these are averages, and your specific goals might differ based on:
Here are the clear indicators that your campaigns are successful:
If you’re maintaining or exceeding your target ROAS over time, that’s a strong positive signal.
Month-over-month increases in conversion value suggest your campaigns are scaling effectively.
Higher quality scores often lead to lower CPCs and better ad positions.
If you’re acquiring customers more cheaply while maintaining quality, you’re on the right track.
On the other hand, you should always be alert to these warning signs:
If your ROAS is dropping without clear seasonal factors, it’s time to investigate.
If people click but immediately leave, your landing pages might not match ad expectations.
Increased costs without corresponding increases in conversion value need attention.
If your AOV is below target, your targeting might need adjustment.
When metrics show room for improvement, consider these strategies:
Now that you know which analytics to watch for, you are ready to improve your ad performance. Start by auditing your current tracking setup and establishing baseline metrics for your key KPIs. Create a simple dashboard with your most important metrics, and schedule weekly review sessions to monitor progress. Within 30 days, you should have a clear picture of your ad performance and opportunities for improvement.
———————-
Ready to get started with high converting ads for your ecommerce store? Schedule a consultation and let’s discuss how we can support your business growth!