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36. KPI in All Industries

36.14 Marketing and Digital Ads

Performance-marketing interviews ask cost per order and return on ad spend (ROAS), and they ask whether the order row actually has a campaign id (Module 35.7). Impressions and clicks are easy to celebrate and easy to waste. CTR (clicks divided by impressions) is a diagnostic, not the decision.

KPI What the number means Who uses it Action it drives
CPA (cost per order) Spend divided by attributed orders. Media buyer A high CPA stops or rewrites that campaign.
ROAS Attributed sales divided by spend. Marketing lead Under 1 means the campaign returned less sales than it cost. Pause it in the practice file.
CTR Clicks divided by impressions. Only as a diagnostic A high CTR with no orders is a curious audience, not a result.

Fictional sample rows. One month. Every order below is attributed. Campaign names are labels, not real ads.

Campaign City Impressions Clicks Spend Orders Sales
Diwali Pune Pune 1,00,000 2,000 ₹20,000 100 ₹80,000
Monsoon Nashik Nashik 20,000 800 ₹8,000 80 ₹40,000
Ganesh Kolhapur Kolhapur 80,000 400 ₹10,000 20 ₹15,000
Weekend Nagpur Nagpur 10,000 500 ₹5,000 50 ₹30,000
Clearance Mumbai Mumbai 5,000 250 ₹2,500 40 ₹12,000
New user Sambhaji Sambhaji Nagar 60,000 300 ₹9,000 15 ₹6,000

Worked from those rows.

  • Impressions 2,75,000. Clicks 4,250. Spend ₹54,500. Orders 305. Sales ₹1,83,000.
  • CTR is 4,250 ÷ 2,75,000 = 1.5%.
  • CPA is 54,500 ÷ 305 = ₹179 (nearest rupee).
  • ROAS is 1,83,000 ÷ 54,500 = 3.36.

Diwali Pune: CPA 20,000 ÷ 100 = ₹200, ROAS 80,000 ÷ 20,000 = 4.00. Monsoon Nashik: CPA 8,000 ÷ 80 = ₹100, ROAS 40,000 ÷ 8,000 = 5.00. Ganesh Kolhapur: CPA 10,000 ÷ 20 = ₹500, ROAS 15,000 ÷ 10,000 = 1.50, on 80,000 impressions. Sambhaji Nagar ROAS is 6,000 ÷ 9,000 = 0.67.

Good KPI Vanity metric
From the same rows Monsoon Nashik CPA ₹100 and ROAS 5.00 Diwali and Ganesh impressions (1,00,000 and 80,000)
Why Nashik spent less and returned five rupees of sales per rupee. Ganesh looks like a big campaign. It brought 20 orders at ₹500 each. Sambhaji returned 67 paise per rupee.

What the manager does. The Nashik buyer keeps Monsoon and may test a small extra spend in the practice file, still labelled fictional. The Pune buyer keeps Diwali (ROAS 4) but does not judge it by the 1,00,000 impressions. The Kolhapur buyer pauses Ganesh. Clearance Mumbai is the quiet winner: CPA 2,500 ÷ 40 = ₹62, ROAS 12,000 ÷ 2,500 = 4.80, on only 5,000 impressions. Small is allowed to win.

Ravindra Bagale's Tip

Many students calculate ROAS where the order has a blank campaign. Call the blank Others, and do not join it to spend and call it ROAS. Use attributed orders only. Try it once more, then move on.