Programmatic Advertising 101: Setting Goals and KPIs
Programmatic advertising can get tricky if you’re not clear from the beginning what you’re trying to achieve with campaigns. Evaluating campaign success and performance can only be tracked and measured accurately if you set specific goals and measure these goals against a specific KPI, or a Key Performance Indicator.
Determining KPIs for Your Programmatic Advertising Campaign
When determining what KPI to measure against, you should be clear on what your business objectives are and how they tie into your campaign goals. For example: If you decide brand awareness is the main objective, then your campaigns need to be designed in a way that specifically aims to increase brand awareness among your audiences.
Once the overall campaign goal is set, you can determine how you will measure it using a KPI.
- Goal = KPI
- Awareness = impressions
- Consideration = clicks
- Sales = conversions
If you’re trying to achieve brand awareness, you likely will measure your campaign’s success based on how many people you reach. In other words: The KPI is impressions. Impressions indicate reach, and they will demonstrate the amount of times an ad gets shown, as well as the potential number of viewers.
Types of KPIs to Consider
When you buy impressions, you’re buying them on a CPM (cost-per-thousand) basis. When running a campaign that is looking to maximize reach, you want to ensure that different people are viewing the ad – not just the same user multiple times. Although capturing the same viewers is important for certain types of campaigns (like retargeting), it’s not an effective way to expand your reach to new prospects.
You can also measure a brand awareness campaign with clicks. An ad click helps determine overall interest, because it will point out the number of people interested enough in the ad that they click on it and visit the landing page. The more users who have clicked on your ad, the more interest there is in the offer. Ultimately, clicks deliver traffic, so the higher click rate you have, the more users you have visiting your site. Tracking CPC (cost-per-click) can help you determine how much you’re paying overall for each click. A lower CPC generally indicates you’re receiving a higher number of clicks for an overall lower cost.
Note: CPC is equal to the CPM rate divided by 1000 times the click-through rate, or CTR.
Many advertisers choose to track their campaigns based on conversions. A conversion occurs when the user completes a specific action on your site, predetermined by you. An action can be anything from a newsletter signup to making a purchase. You can track how much you have spent on a conversion by using a CPA (cost per acquisition) tracking model. By using this tracking model, you’ll know that not only have users seen the ad (tracked by CPM), but they have clicked on it (tracked with CPC), and they engaged with the site in some way (conversion/CPA).
When setting up a campaign, determine what results you want from your campaign and work backwards. Once you have the goal and KPI established, you can choose what campaign targeting tactic will work best to achieve this. Ultimately, you’ll want your campaigns to produce full-funnel results, starting with awareness, moving to product consideration, and ultimately resulting in conversions.
Example KPIs for Different Programmatic Ads
If you’re running an awareness campaign aimed at gaining impressions, you could try an audience or contextual campaign for desktop, or a hyperlocal campaign for mobile.
If you’re running an engagement or consideration campaign aimed at getting clicks, you could try a video campaign, or mobile app campaign to get users to click to learn more.
If you’re looking for sales, conversions or customer acquisitions, you want to focus on retargeting campaigns, as this tactic will bring users who are familiar with the brand back to the site.
Assigning a specific goal and KPI is also important to make appropriate campaign optimizations.
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