Also check out our guide to Attribution terminology (accrual vs cash, conversion lift, etc.)
AOV (Average Order Value)
The average dollar value of orders that were attributed to the ad.
AOV = Revenue from this ad / Total number of transactions credited to this ad
ATC (Add To Cart)
The number of products that were added to the cart as a result of the ad.
Bid Cap
This places a hard limit on the maximum spend on acquiring each customer (CAC).
Example: If you specify a $50 bid cap, the ad platform will not spend more than $50 on any single conversion from that campaign. This bid strategy gives you the most control over your budget and is more suitable for pro advertisers who have a good understanding of predicted conversion rates.
Also see Cost Cap.
Learn more about bid strategies here.
CAC (Customer Acquisition Cost)
How much it costs to get one customer to purchase from this ad. Also known as Cost per Acquisition or Cost per Conversion or Cost per Result (when the objective of the campaign is conversions).
A good way to look at this is to measure your CAC against your AOV – your average order value should be significantly greater than your average CAC. Simply put, the amount a customer spends with you should cover not just the cost of acquiring your customer, but also the production cost, shipping, and other business expenses.
CAC = Amount spent on this ad / Number of customers from this ad
Clicks
All clicks on the ad. This includes outbound clicks as well as engagement clicks (zoom-in, likes, comments, etc).
Conversion
The number of times your final goal was completed. For eCommerce ads, this is typically a purchase.
Cost cap
The advertiser specifies an average cost per conversion. This gives the ad platform the flexibility to go above your specified budget for some conversion as long as the average conversion cost stays below the cost cap amount. This is probably the better option option if you are not a pro advertiser.
Example: If you specify a $50 bid cap, the ad platform may get one sale for $40 and another for $60, but will keep the average cost of acquisition (CAC) at $50.
Also see Bid Cap.
Learn more about bid strategies here.
CPC (Cost Per Click)
The effective amount the advertiser pays for each click on the ad.
CPM (Cost Per Thousand Impressions)
The amount it costs the advertiser to show the ad 1000 times. This is the standard way of measuring the cost of advertising.
While you don’t want your CPM to be too high, remember that very low CPMs may mean that your target audience is too generic. A highly targeted audience with strong purchase intent will typically cost more.
CTR (Click-through-rate)
The percentage of impressions that resulted in a click. A high CTR shows that the creative is resonating with your audience.
However, a high CTR may not always mean higher ROAS, so it’s important to measure your clicks against your conversions. For instance, a provocative or funny ad may attract clicks but no purchases.
CTR = Number of clicks / Number of impressions
Frequency
The average number of times each shopper saw the ad.
For retargeting ads, a good frequency is 1-2 per day. (When checking this, do make sure that you are looking at the correct time window. It’s easy to accidentally see 14 frequency in a 7 day window and mistake it for 14 per day when it would actually be 2 per day).
For prospecting , the frequency should be below 2 for any date range that you’ve selected.
Frequency = Total impressions / Total reach
Impressions
The number of times an ad was served.
Outbound Clicks
Clicks to an external landing page.
Reach
The number of unique people who have viewed the ad.
ROAS (Return On Ad Spend)
This measures the amount of revenue earned for every dollar spent on this ad.
ROAS = Revenue Earned / Total Ad Spend
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