MKTG90026 Chap.10 Advertising and Digital Performance
Advertising and Digital Performance
Advertising metrics trace media delivery, message response, conversion and business outcome. This chapter connects reach, frequency, impressions, rating points, CPM and share of voice with viewability, CTR, CPC, engagement, conversion, lead-to-customer rate, CPA, ROAS and web analytics.
The central discipline is funnel reconciliation: every rate belongs to one transition, and an efficient intermediate rate does not guarantee more customers or profitable growth.
What this chapter covers
- 01
Reach, frequency and impressions
- 02
GRP, TRP, CPP and CPM
- 03
Spend and impression share of voice
- 04
Viewability, CTR and CPC
- 05
Conversion, CPA and ROAS
- 06
Sessions, users and abandonment
Worked example · free
Reconcile a digital funnel
- 1CTR is 24,000 divided by 1.2 million, or 2%.
- 1CVR is 3,600 divided by 24,000, or 15%.
- 1CPA is 48,000 divided by 3,600.
- 1CPA equals 13.33 dollars.
- 1Interpret each metric at its own funnel transition.
Key terms
- Gross Rating Points
- Reach percentage multiplied by average frequency for a defined population.
- Click-Through Rate
- Total clicks divided by total impressions.
- Acquisition Cost
- Advertising spend divided by attributed conversions or acquired customers under the stated rule.
Advertising and Digital Performance FAQ
What is the difference between reach and impressions?
Reach counts unduplicated people with an opportunity to see the ad, while impressions count exposures. One reached person can generate several impressions, so average frequency connects the two measures.
Can a lower CTR produce more conversions?
Yes. A campaign with a larger impression base or stronger post-click conversion can create more total customers despite a lower click rate. Restore the counts and carry them through every funnel transition before ranking performance.
Why is ROAS not profit?
ROAS divides attributed advertising revenue by spend. It does not subtract product cost, fulfilment, returns or other operating expenses, and attribution does not automatically prove incrementality. Compare revenue with contribution and customer value before making an investment decision.
How should two campaigns be compared fairly?
Reconstruct comparable funnel counts and use the same attribution window, customer definition and cost boundary. Compare scale, transition rates, acquisition quality and contribution rather than choosing the campaign with the single best intermediate rate.
Exam move
Draw the full funnel from impressions to customers and label the denominator for each rate. Recompute frequency, CPM, CTR, CVR, CPA and ROAS from one campaign, then change a single transition and trace every downstream count. Compare rates with scale, cost and customer value so local optimisation does not replace the business outcome. Start with media delivery.
Reach counts unduplicated people with an opportunity to see, impressions count exposures, and average frequency links them. Calculate rating points as reach percentage times frequency under the stated convention, then calculate CPM from spend and impressions. Keep people separate from exposures.
A campaign can buy more impressions without expanding reach if the same audience receives repeated exposures, so always inspect both scale and repetition. Extend the funnel through viewable impressions, clicks, sessions, leads, conversions and customers. Write the eligible base beside CTR, conversion rate and lead-to-customer rate.
Restore counts before comparing two campaigns because a better local rate on a smaller base may produce fewer customers. If a click rate falls while impressions and post-click conversion rise, total conversions can still grow. Reconcile each transition so the funnel cannot create or lose people without an explicit stage definition. Attach cost to the correct output.
CPC uses clicks, cost per lead uses leads and CPA uses the acquisition or action named by the scenario. Compare cost efficiency with quality, margin and customer value. A low CPA can be unattractive when customers churn quickly, while a higher CPA can be sustainable for a valuable segment.
Calculate ROAS as attributed revenue over advertising spend, then state why product cost, fulfilment, returns and incrementality are not captured. For web analytics, separate users, sessions and events. An engaged session rate or bounce definition depends on the platform rules, so preserve the supplied operational definition. Attribution assigns credit under a model; it does not alone establish causal lift.
Compare channel-reported conversions with a controlled incrementality design, holdout or credible counterfactual where the scenario permits. Use share of voice with market position as a diagnostic, not a guarantee of future share. For exam drills, sketch the entire funnel and calculate both rates and resulting counts.
Cover the answer options, predict direction and keep currency, people, sessions and exposures as explicit units. Maintain an error log for reach versus impressions, denominator drift, rates compared without scale, CPA without customer quality and ROAS labelled as profit. Finish each recommendation with the constrained stage, the business outcome it affects and one measurement limitation that could change the decision.
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