Most business owners I speak to are spending money on digital advertising and not entirely sure what they’re getting for it. They’re running Google or Meta ads, their agency sends a report each month with an overload of metrics, and the numbers look positive – reach is up, clicks are increasing, cost per click is down.
But when I ask whether they’re getting more enquiries or seeing growth in the business, the answer is often “things seem about the same” or “hard to tell.” That gap between what the report shows and what the business is actually experiencing is almost always a measurement problem.
The trouble with how digital ads usually get reported
Most digital advertising reports are built around the metrics that are easiest to show. Click-through rates. Impressions. Reach. Cost per click. These numbers aren’t worthless, but none of them tell you whether the advertising is doing its actual job.
A high click-through rate means people clicked on your ad. It says nothing about whether they called you, filled in a form or bought something. A low cost per click sounds efficient, but if those clicks are coming from people with no interest in your product or service, you’re paying for traffic that goes nowhere.
This is what the industry calls vanity metrics. They measure activity. What you need to measure is outcomes.
The numbers that actually tell you something about your digital advertising
There are four metrics I want to see before I can give anyone an honest read on how a campaign is performing.
Cost per conversion
This is what it costs you to generate one meaningful action – a phone call, a form submission, an online booking. If you’re spending $1,000 a month and generating 20 enquiries, your cost per conversion is $50. That’s not the final picture though, we need to know what percentage of these are qualified, because 20 non-qualified conversions may as well be $1,000 spent on nothing. This is data your business can actually work with. It tells you whether the ads are commercially viable and gives you a benchmark to improve against.
Rocky Trail Entertainment runs mountain biking events and races across Australia. Registration prices vary by event, and the more it costs to generate each conversion, the more it eats into their margins.
One of their upcoming Superflow events costs $114 for an adult rider. The campaign we’re running to drive registrations is currently converting leads at around $9 each, a strong result that keeps their cost per conversion well under control.
Conversion rate
Of the people who click your ad and land on your website, how many actually do something? A low conversion rate is often a signal that the problem isn’t the ad itself – it’s the landing page, the offer or how easy it is to make contact. Sometimes improving the website or user journey has a bigger impact on results than increasing the budget or over optimising your ads.
Attribution
Where is the enquiry actually coming from? Someone might click your Google ad on a Monday, then come back directly three days later and fill in your contact form. Without proper tracking in place, most platforms won’t connect those two events. You can end up underfunding your best-performing channel while overspending on one that’s taking credit for work it didn’t do.
Getting attribution right from day one is one of the more unglamorous parts of setting up a digital advertising campaign. It’s also one of the most important.
We work with Military Shop to help sell high-quality military products to ADF, police and security organisations across Australia. Alongside the Google Ads campaigns we manage, they run Meta Ads, email marketing and SEO to build their online presence across multiple channels.
Because customers often interact with more than one channel before buying, we use data-driven attribution models and cross-match what’s recorded in their backend against what each platform reports. This gives a much more accurate picture of where sales are actually coming from. Sometimes that means Google Ads is only credited with half a sale, because the same customer also clicked a Meta Ad or found the business organically at another point in their journey.
Profit on ad spend
If you run an e-commerce business or can track revenue directly back to your campaigns, return on ad spend (ROAS) tells you how much return you’re generating for every dollar you spend. Profit on ad spend (POAS) tells us how much profit we’re actually making from a campaign. A high ROAS doesn’t always translate to profitable campaigns, and that’s something that’s often overlooked by advertisers. A POAS of 4:1 means every $1 in ads is returning $4 in profit. It’s a straightforward way to assess whether advertising is a viable growth lever for your business or something that needs a rethink.
Not every business will have visibility across all four of these straight away. But if your reporting doesn’t include at least one clear outcome metric, the conversation with your agency needs to change.
The question worth asking your agency
If you’re looking at a monthly report and not confident about what you’re seeing, start with one question: how many enquiries or sales did this generate, and what did each one cost us?
A good agency should be able to answer that clearly. If the response leans heavily on reach and impressions without connecting them back to a business outcome, it is worth pushing further.
Digital advertising is not complicated in principle. You spend money to reach people who are likely to buy from you, and you measure whether they do. The complexity is in the setup – making sure tracking is configured correctly, that you’re measuring the right conversions and that you’re reading the results across channels in a way that reflects what’s actually happening.
That’s the part of this work I find most interesting. And it’s consistently where the difference between a campaign that looks good on paper and one that genuinely delivers tends to show up.
If you want to understand how Threesides approaches this end of digital advertising, you can read more about our digital advertising services here.
Not sure whether your current advertising is being measured the right way? We’re happy to take a look. Get in touch with the Threesides team and we can talk through what you’re seeing.