There are only a few important metrics to understand when running Native Ads:
CPM is your bid
CPC is the translated cost per click
Campaign Optimization Formula = CPC x ad CTR x 10 = CPM
Have you ever wondered what the simple difference is between a High CPC and a low CPC campaign? Below is a simple way to understand how targeting impacts the CTR and the intended audience segment.
Headline: Men Over 50 without Life Insurance? You’ll Want to See This
Targeting: Specific
CTR: 0.05%
Headline: Men Over 50? You’ll Want to See This
Targeting: Narrow
CTR: 0.10%
Headline: Over 50? You’ll Want to See This
Targeting: Broad
CTR: 0.15%
The goal is to optimize one of the following:
-The Ad Level
-The Content Level
-The Offer Level
As you increase one variable, the other elements in the funnel start to change. For example, if your campaign has a narrow audience targeting, it therefore has a lower ad CTR, and the chances that your campaign will reach the intended narrow audience segment are extremely high. The CPC will change on the front-end, and ad CTR and conversion rate will change on the back-end.
Focus on increasing or decreasing levers in the campaign optimization formula to achieve your intended targeting and metrics on native ads.