# Understanding Metrics Used in Online Advertisement Campaigns such as Click Through Ratio, Cost Per Click, Conversion rates, Ad Impressions, Cost Per Sale, etc.

You have probably come across many metrics used in online advertising like the ones shown below.

Online Metrics
Values
Media Cost
Click-Through-Rate (CTR)
Cost-Per-Thousand (CPM/CPT)
Clicks
Cost-Per-Click
Conversion Rate
Opportunity Response
Cost-Per-Opportunity
Conversion Rate
Sales
Cost Per Sale

Media Cost

Let us now fill in the Ad Impression B1 cell onto the Excel spreadsheet.
​ Each time your ad appears on Google Search Page Results or on Google Display Network, it is counted as one impression. You cannot have Clicks without Impressions. Users need to see your Ads before they can decide whether to click on them.

In this example, you have spent \$100,000 to get 10,250,000 ad impressions.

Understanding Online Advertising Metrics Using Microsoft Excel

Click Interactions

Fill in 27,560 under Clicks in cell A6 in your Excel Spreadsheet.

Understanding Online Advertising Metrics Using Microsoft Excel

For information on how to set up conversion tracking, click below resource.

Conversion tracking is a free tool that shows you what happens after a customer clicks on your ads — whether they purchased a product, signed up for your newsletter, called your business, or downloaded your app. When a customer completes an action that you’ve defined as valuable, these customer actions are called conversions.

Understanding Online Advertising Metrics Using Microsoft Excel

Now that you have entered the four basic information into the Excel Spreadsheet, let us now proceed to work on the rest.

Hence, type the formula =B6/B1 into Cell B3. You should get 0.27% for CTR.

Understanding Online Advertising Metrics Using Microsoft Excel

Cost-Per-Thousand is a marketing term used to denote the price of 1000 advertisement impressions.
Type the formula =B2/B1 * 1000 into Cell B4. You should get \$9.76 for CPM.

Understanding Online Advertising Metrics Using Microsoft Excel

Type the formula =B2/B6 into Cell B7. You should get \$3.63 for CPC.

Understanding Online Advertising Metrics Using Microsoft Excel

Conversion Rate is the average number of conversions per Ad click, shown as a percentage. Conversion Rate is computed by simply taking the number of conversions and dividing that by the total number of Ad clicks.
Type the formula =B10/B6 into Cell B8. You should get 51.89% for Conversion Rate.

Understanding Online Advertising Metrics Using Microsoft Excel

To find out the Cost Per Opportunity,
Type the formula =B2/B10 into Cell B11. You should get \$6.99 for Cost-Per-Opportunity.

Understanding Online Advertising Metrics Using Microsoft Excel

Assuming you made a total 1,235 sales after spending \$100,000 in online advertisement campaigns, let us now calculate the Conversion Rate for your Sales. Conversion Rate for Sales is calculated by taking Sales divided by total number of conversions.

Type the formula =B14/B10 into Cell B12. You should get 8.64% for Conversion Rate.

Understanding Online Advertising Metrics Using Microsoft Excel

To find out Cost-Per-Sales, simply
Type the formula =B2/B14 into Cell B15. You should get \$80.97 for CPS.

Understanding Online Advertising Metrics Using Microsoft Excel