How to Measure Advertising ROI
By Seikh Arsalan, QuickGrow Ads Agency
Short answer
To measure advertising ROI, track every lead and sale back to its campaign, then compare revenue with total cost. ROAS = revenue from ads ÷ ad spend. ROI = (profit from ads − total ad cost including agency fees) ÷ total ad cost. Clicks and likes alone do not show whether ads are paying for themselves.
Metrics that matter
- Cost per lead (CPL) = ad spend ÷ number of leads
- Lead-to-customer rate = customers ÷ leads
- Cost per acquisition (CPA) = ad spend ÷ customers
- ROAS = revenue from ads ÷ ad spend
A simple worked example
Illustrative numbers only: if you spend ₹10,000 on ads, receive 50 leads and 5 become customers worth ₹6,000 each, your CPL is ₹200, your CPA is ₹2,000 and your ROAS is 3x (₹30,000 ÷ ₹10,000). Subtract product costs and agency fees to see true profit.
How to track it properly
Install the Meta Pixel and Google Ads conversion tracking, use UTM links, and record the source of every enquiry in a CRM or spreadsheet. Review results weekly, but judge campaigns over several weeks — short periods can be misleading.
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