Digital Marketing Metrics Quiz

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Questions and Answers

What does the Cost Per Click (CPC) metric specifically track?

The cost incurred for each impression of the ad.
The total engagement rate of the ad with users.
The cost-efficiency of generating website traffic or ad clicks. (correct)
The total revenue generated from ads.

Which metric specifically helps determine how well clicks convert into sales?

Return on Investment (ROI)
Cost Per Acquisition (CPA)
Click-Through Rate (CTR)
Conversion Rate (CR) (correct)

What is the primary purpose of the Cost Per Thousand Impressions (CPM) metric?

To measure the cost of acquiring customers.
To evaluate profit margins on ad campaigns.
To assess ad engagement rates across various channels.
To determine the cost of reaching 1,000 people in advertising. (correct)

Which formula accurately describes the Return on Investment (ROI)?

<p>$ROI = rac{Total Revenue - Total Cost}{Total Cost} imes 100$ (A)</p> Signup and view all the answers

Which of the following formulas is used to evaluate the cost-efficiency of acquiring a single sale?

<p>$Cost Per Sale = rac{Total Media Spend}{Total Sales (Transactions)}$ (C)</p> Signup and view all the answers

Flashcards

ROI (Return on Investment)

Measures the profitability of a campaign compared to its cost.

CTR (Click-Through Rate)

Indicates how often people click on an ad after seeing it.

CR (Conversion Rate)

Measures how effectively clicks on an ad turn into actual sales or desired actions

CPC (Cost Per Click)

Tracks the cost-efficiency of generating website traffic or ad clicks.

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Cost Per Sale/Transaction

Evaluates the cost-efficiency of acquiring a single sale or customer.

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Study Notes

Return on Investment (ROI)

ROI = (Total Revenue - Total Cost) / Total Cost × 100
Measures profitability of a campaign against its cost

Click-Through Rate (CTR)

CTR = (Total Clicks / Total Impressions) × 100
Indicates ad relevance and audience engagement

Conversion Rate (CR)

CR = (Total Conversions/Sales / Total Clicks) × 100
Measures effectiveness of clicks turning into desired actions (e.g., sales)

Cost-Per-Click (CPC)

CPC = Total Media Spend / Total Clicks
Tracks cost-efficiency of generating website traffic or ad clicks

Cost Per Sale/Transaction

Cost Per Sale = Total Media Spend / Total Sales (Transactions)
Evaluates cost-efficiency of acquiring a single sale

Profit (Search Ads)

Profit = (Transactions × Margin Per Transaction) - Media Spend
Demonstrates the financial success of search ad campaigns

Cost Per Thousand Impressions (CPM)

CPM = (Total Media Spend / Total Impressions) × 1000
Measures cost of reaching 1,000 people in awareness campaigns

Cost Per Acquisition (CPA)

CPA = Total Media Spend / Total Conversions (Sales)
Assesses cost-efficiency of acquiring one customer or sale

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Description

Test your knowledge on essential digital marketing metrics such as ROI, CTR, and Conversion Rates. Understand how to measure the effectiveness of campaigns and their cost-efficiency. This quiz will enhance your comprehension of key performance indicators in digital advertising.