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SearchCTR, CPC, CPM, CPA, and ROAS describe different aspects of advertising performance. Learn their formulas and how to read them alongside conversions and business results.
Reports from Google Ads, Meta Ads, and other platforms bring together metrics that answer different questions: how many times an ad was shown, how many people clicked, and what results are attributed to the campaign. Understanding what each indicator counts helps you interpret the report; a figure on its own does not prove that a campaign is profitable.
To compare data, use the same period, channel, and campaign scope. Also check which action is considered a conversion and how results are attributed. Definitions can vary between platforms or configurations.
CTR (click-through rate) relates clicks to impressions. It helps you observe the response to an ad, but on its own it does not indicate whether visits make purchases or generate revenue.
Formula: CTR = (clicks ÷ impressions) × 100
Example: 350 clicks ÷ 10,000 impressions × 100 = 3.5%.
CPC shows how much was spent, on average, for each counted click. It should not be confused with a maximum bid: it is an average result calculated from spend and clicks.
Formula: CPC = advertising spend ÷ clicks
Example: €500 ÷ 350 clicks = approximately €1.43 per click.
CPM expresses how much it costs to show an ad one thousand times. It helps you understand the cost of exposure, not the number of unique people reached or the sales generated.
Formula: CPM = (advertising spend ÷ impressions) × 1,000
Example: (€500 ÷ 10,000 impressions) × 1,000 = €50 CPM.
A conversion is the action the business decides to measure: it could be a purchase, a submitted form, a call, or a registration. Before comparing campaigns, confirm that the same action is being counted and that measurement is working correctly.
This measures what proportion of the visits or sessions considered completed the defined action. The result depends on the denominator used in the report—for example, visits or clicks—so it is worth checking.
Common formula: conversion rate = (conversions ÷ visits) × 100
Example: 20 sales ÷ 350 visits × 100 = approximately 5.7%.
CPA (cost per acquisition or per action) divides spend by attributed conversions. For the figure to be interpretable, you need to specify which action is being measured: a sale and a registration do not necessarily represent the same result.
Formula: CPA = advertising spend ÷ conversions
Example: €1,000 ÷ 20 sales = €50 per sale.
CPL (cost per lead) applies the same principle to the contacts obtained. The cost alone does not indicate their quality or how many will eventually become customers.
Formula: CPL = advertising spend ÷ leads
Example: €800 ÷ 40 leads = €20 per lead.
ROAS (return on ad spend) compares the revenue attributed to ads with advertising spend. A ROAS of 5 means that €5 in revenue is attributed for every euro of advertising spend; it does not mean the business makes €5 in profit.
Formula: ROAS = revenue attributed to advertising ÷ advertising spend
Example: €5,000 in attributed revenue ÷ €1,000 in spend = 5 (or 5:1).
The metric does not, by itself, include costs such as production, shipping, staff, or commissions, nor does it establish how much remains after covering them. That is why it should be read alongside margins and other relevant costs, without confusing attributed revenue with net profit.
Each metric provides a different piece of information:
A useful reading follows the full journey: exposure, click, visit, and action. If a figure seems favorable, check which denominator it uses, what period it covers, and what result it represents. That way, traffic metrics are not confused with business metrics, and the report can be understood in the context of the company’s objectives and costs.
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