This is a modification of the CPA metric that is applied if the target action chosen was to submit an application or fill out an online form.
CPL = contextual advertising costs / number of leads.
It is only reasonable to consider the cost b2b email list of attracting a lead for businesses with expensive goods that are sold in stages. We are talking about the services of lawyers, builders, financial consultants, etc. They need to collect contact information in order to then sell the service.
How to calculate CPL?
To calculate the indicator for contextual advertising in Yandex, you need to look at the data. In Yandex Metrica, they are available in the Conversions report. In Google Analytics, calculated indicators are configured in the same way as in MPA.
Why count?
CPL shows whether the costs of attracting potential buyers are within or exceeding the advertising budget.
Order cost (SRO)
As the name suggests, this metric shows the cost of an order. SROs calculate it to determine how much each order will cost the nurture leads to conversion advertiser. The metric is relevant primarily for online commerce.
The formula used for calculation is:
CPO = costs of contextual advertising / number of orders received.
SRO can be considered as a type of CPA. The peculiarity of SRO is that the target action is exclusively an order. If the advertiser has set a goal – to promote an order, then these CPA and SRO will correspond to each other.
How to calculate?
To calculate SRO, you can use reports from Yandex Metrica and Google Analytics.
Customer Acquisition Cost (CAC)
The metric shows how much it costs a business to attract a client. The formula used to calculate it is:
CAC = customer acquisition costs / number of new customers.
The costs of attracting new clients from contextual advertising include:
- payment for advertising in Google Ads or Yandex Direct;
- payment of wages to a full-time employee or advertising agency;
- costs for software, online services for setting up advertising;
- associated costs, such as paying for the Internet, renting premises (they are taken into account in proportion to the SMM marketer’s earnings);
- costs for preparing landing pages, including payment for the services of a designer, layout designer, copywriter, etc.
In each case, the amounts invested in it email list attracting clients may differ.
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How to recognize SAS
CAC data is contained in Google Ads and Yandex Direct reports:
- in Google Ads reports, they are easy to view by ad criteria, keywords, campaigns, and ad groups;
- In Yandex Direct reports they are available by campaign.
By the way, information about new clients can be taken from the CRM system.
CAC helps you find out how much money is spent on expanding your customer base and finding problem areas at different stages of the sales process. However, the value of this metric is not decisive without comparison with the LTV indicator.
Customer Lifetime Value (LTV)
It is important not only to attract a client, but also to retain it. The LTV indicator was create precisely to evaluate the results of interaction with the client base. It shows what total profit a company receives from one client over the entire period of work with him.
There are different ways to determine LTV. Sometimes the following formula is use:
LTV = revenue from a customer – costs of attracting and retaining a customer.
The costs of attracting a client include:
- payment for contextual advertising;
- earnings of a context specialist;
- payment for development and design of the landing page and others.
To find out LTV, another formula is also use:
LTV= C1 * C2 * C3 * C4, where:
C1 — average bill;
C2 — average monthly number of orders;
C3 — average time of interaction with the client (months);
C4 — payback (%).
LTV is a significant metric in business. It is especially important for online stores to evaluate it in order to identify loyal customers and improve the process of retaining them.