The Metrics That Actually Move the Needle in Digital Advertising
When it comes to paid media, success isn’t measured by impressions or clicks alone. Real performance comes down to whether your ads are meeting your business goals—and that requires tracking the right KPIs.
At Root Company, we manage ad campaigns across Google, Meta, LinkedIn, and more. While every client’s strategy is customized, our approach to measurement is consistent. We focus on the key performance indicators (KPIs) that tie directly to outcomes like leads, sales, and return on ad spend.
Here are the top KPIs we track for every paid media client—plus why each one matters.
1. Cost Per Lead (CPL) or Cost Per Acquisition (CPA)
What it is: The average amount spent to generate one lead or customer.
Why it matters: CPL/CPA tells you how efficiently your campaign is turning ad spend into results. This is the primary KPI for most lead gen and e-commerce campaigns.
What we do with it:
- Identify which campaigns or channels are most cost-effective
- Adjust bidding strategies and budgets accordingly
- Set performance benchmarks to scale or pause campaigns
2. Return on Ad Spend (ROAS)
What it is: Revenue generated for every dollar spent on ads.
Formula: Revenue ÷ Ad Spend
Why it matters: ROAS measures profitability. A high ROAS means your ads are driving revenue, not just traffic.
What we do with it:
- Track ROAS at the campaign and product level
- Use it to guide investment decisions and scaling strategies
- Evaluate ad effectiveness across different customer journeys
3. Click-Through Rate (CTR)
What it is: The percentage of impressions that result in clicks.
Formula: (Clicks ÷ Impressions) × 100
Why it matters: CTR is a strong indicator of how relevant your ads are to your audience. It also affects your quality score and CPC in platforms like Google Ads.
What we do with it:
- Optimize ad copy, headlines, and creatives for better engagement
- Benchmark performance by channel and industry
- Use CTR trends to identify ad fatigue or creative burnout
4. Conversion Rate (CVR)
What it is: The percentage of users who take a desired action after clicking an ad.
Why it matters: A high conversion rate means your landing page, offer, or funnel is doing its job.
What we do with it:
- Audit landing pages for UX, message match, and friction
- A/B test headlines, forms, and calls to action
- Segment by device or audience to improve performance
5. Cost Per Click (CPC)
What it is: The amount paid for each click on your ad.
Why it matters: CPC helps gauge how competitive your market is—and how efficiently you’re buying traffic.
What we do with it:
- Monitor for rising CPCs as a sign of audience saturation or platform changes
- Compare CPC against conversion rate to assess value per click
- Optimize bidding strategies to maintain profitability
6. Impression Share (Google Ads)
What it is: The percentage of times your ads showed compared to the total available impressions for your target keywords.
Why it matters: Low impression share means you’re missing opportunities—either due to budget limits or low ad rank.
What we do with it:
- Adjust budget allocations for high-value campaigns
- Improve ad quality and relevance
- Test different match types or bidding strategies
7. Frequency (Social Ads)
What it is: The average number of times a user sees your ad.
Why it matters: High frequency can lead to ad fatigue and declining performance.
What we do with it:
- Rotate creative and messaging
- Expand or refine audience targeting
- Monitor CTR and engagement over time to detect fatigue early
8. Lead Quality or Post-Click Engagement
What it is: A measure of how qualified leads are once they convert, or how users behave after the click.
Why it matters: Not all leads or clicks are created equal. High quantity means nothing if lead quality is poor.
What we do with it:
- Track metrics like time on site, bounce rate, and form completion
- Use CRM and sales team feedback to evaluate lead quality
- Refine targeting and messaging based on behavioral data
Want to Know How Your Ads Are Performing?
Effective paid media isn’t just about launching ads—it’s about understanding what’s working, what’s not, and how to optimize over time. By tracking the right KPIs, you can make smarter decisions, protect your budget, and focus on strategies that drive real business growth.
At Root Company, every campaign we launch is backed by a clear reporting framework, built around the metrics that matter most to your goals. Whether you want more leads, more sales, or more return on ad spend, we’ll help you track performance and act on it with confidence.
We’ll review your current campaigns and provide a custom KPI dashboard that makes your results easy to understand and act on.
Book your free strategy call now »