4 Minute Read

There’s no getting around it. If you are paying for ads, you need to know whether they’re working. And that means you have to know which ad performance metrics to monitor.

By watching the right metrics, you can learn everything you need to know about your ads and whether they are hitting the mark. But how do you know which metrics matter and which ones are just white noise?

There are hundreds of ad performance metrics. In this post, we take a look at the seven most important ad performance metrics and what you should expect in ad performance reports. For help getting your ads in the right places and in front of the right people, reach out to the world-class ad performance team at Playwire.

Gold Standard Ad Performance Metrics

The ad performance metrics that matter most to your brand may be unique to you, but there are a few gold standard metrics that set the tone for ads in most industries: viewability, video completion rate and click-through rate (CTR).

Let’s take a closer look at the first three most important ad performance metrics.

1. Viewability

You want people to actually see your ad. Otherwise, what was the point? This is what viewability measures in digital advertising. 

Viewability as an ad performance metric measures whether the ad was seen and for how long users saw it. The industry standard for a display ad to be considered “viewable” is that at least half of the ad must be visible on the user’s screen for one second or more. For video ads the standard is 50% in-view for 2s.

According to Google, the average publisher viewability for video ads is 66.1%, and 49% for display ads.

2. Video Completion Rate

If you are running video ads, you need to know your video completion rate. That is, how many people watched the video ad from start to finish?

In an ad performance report, the video completion rate is most often presented as a percentage. The formula is the number of video completions divided by the number of times the video was started. This metric might also be listed simply as “completed views” or something similar. 

However this metric is presented to you, the point is to understand how many people are becoming fully engaged in your video ads. The higher this percentage is, the better.

Average video completion rates (VCR) have been declining slightly and were at 84% in Q2 2020, according to the Extreme Reach Video Benchmarks Report.

3. Click-Through Rate

CTR is an oldie but a goodie. Advertisers and publishers have been monitoring this metric for years — basically since some of the first online banner ads were ever published.

CTR is simply the number of ad impressions that result in a click on the ad divided by the total number of impressions. This gives you an idea of how many people are finding your ad useful or enticing.

What is a good CTR? Over time, internet users have become less likely to click on ads, and CTRs have dropped as a result. In 2021, a “good” CTR will vary, depending on the type of content, the product or service being advertised and the targeted demographic. 

A benchmark CTR for standard banners might be 0.20%, while CTR for video ads typically sits closer to 2% on the higher end.

Other Digital Ad Metrics to Watch

Viewability, video completion rate and CTR are the gold standard ad performance metrics to monitor in your ad performance reports. But many other metrics and KPIs could be important to your business. We discuss a few of these below.

4. Cost Per Acquisition

The cost per acquisition (CPA) of a particular ad tells you how much it cost you, in total, to acquire a single paying customer. To calculate CPA for an ad, you take the total amount spent on the ad and divide it by the number of paying customers you acquired as a result of the ad.

5. Purchases

While your CPA can tell you about actions users took on the ad itself, you also want to measure the actions they take on your website, such as purchases. 

Depending on what the ad is selling, you could measure purchases as an ad performance metric in a variety of ways. For example, you can set up goal completions in Google Analytics that tie in with traffic your site gains from particular ads. And one of those goals can be an actual purchase or even someone adding something to their digital shopping cart.

6. Demographic Information

In advertising, demographics matter. Most advertisers have key demographics in mind for every ad they send out into the world. And you should make sure your ads are actually reaching those demographics.

If this is an important metric to you, your ad provider should include this information in your ad performance reports. This is usually expressed as a percentage of the viewers who were “in demo.” For example, if your ad reached 1 million people and 600,000 of them were in the age, location, income level or other demographic group you wanted to target, your in-demo percentage would be 60%.

7. Time Spent

“Time spent” is an ad performance metric that tells you a lot about viewer engagement. It’s similar to video completion rate, but it doesn’t require the user to actually complete the video to count toward the time-spent percentage. 

This metric answers one simple question: How much time did people actually spend viewing the ad? The more time spent viewing your ad, the more engagement your ad generated. 

Time spent has grown in popularity as an ad performance metric in recent years. Some in the advertising industry see it as an alternative to the more traditional route of selling impressions — a process that is often plagued by ad fraud.

What to Look for in Ad Performance Reports

Ad performance reports vary from provider to provider, but you should expect two key reports: weekly reports and wrap-up reports.

Weekly reports should detail the financial analytics behind your current campaigns. How much have you spent? Is spending on track? The answers to these and similar questions should be clear in every weekly ad performance report you receive.

Wrap-up reports detail the total performance of an ad or ad campaign after it has ended. Expect high levels of detail for every ad performance metric you and the provider agreed to monitor. 

Examples of metrics to look for in wrap-up reports include delivered impressions, clicks, CTR, viewability, completed views, video completion rate, invalid traffic and actualized spend.

Get Best-in-the-Industry Ad Performance Reporting

Ad performance reporting is an essential part of the deal in advertising campaigns. That’s why the team at Playwire focuses on providing the best, most detailed ad performance reports in the industry.

Our ad campaigns perform. And our ad performance reports prove it. To get started with Playwire, give us a call at 1-561-206-4621 or contact us online.