Customer Acquisition Cost (CAC) is a critical metric for anyone using paid advertising for an ecommerce brand. If your CAC is too high, revenue won't grow, but if you aren't spending enough on leads they will not convert to customers.

What is a digital marketing metric or KPI?

KPIs, or Key Performance Indicators, are the critical metrics that successful brands use to measure their results. 

Getting a good Return On Ad Spend (ROAS) makes the difference between a thriving ecommerce brand and a dying one. It’s important to understand how to use ROAS as a metric to make marketing decisions about your paid advertising, and also when ROAS might not be that helpful.

ROAS is especially important for ecommerce businesses who are running multiple ads on different channels. It gives a metric that can be tracked at the channel, campaign, or ad level to determine what is working and what is not with regards to advertising performance.

Using ROAS, you can often tell at a glance whether an ad is a candidate for scaling or needs to be turned off. It’s very helpful for evaluating the effectiveness of specific advertising campaigns, rather than a 10,000 ft view of your marketing department.

Unless you have been advertising online blindly or spending too much time on TikTok, you have probably seen the acronym CPL. Cost Per Lead (CPL) is a metric that most media buyers track for the brands they advertise for.