It’s quite common for our clients and the larger community of growth professionals to come to us with this question: how well are doing in terms of performance on cost and creative?
At Pearmill — a tech-enabled ad agency — we’ve spent the last couple of years managing budgets from small to large for a variety of clients in different industries. From direct to consumer, to B2B — we have first-hand knowledge of looking at these numbers and believe they should be shared for the larger community to use as benchmarks when judging their internal team or agencies they’re working with.
That’s an easy thought to have, but it’s rather complicated — because these numbers fluctuate a lot on a per industry and company basis but I’ll do my best to provide a clear picture on how to measure the success of campaigns based on what we’ve learnt over the past couple of years.
Creative Performance
One of the main performance metrics we always keep an eye on (sometimes programmatically) is around how well the creative is performing.
The main metric we take a look at here is Click Through Rate (or Tap Through Rate).
This turns out to be one of the only metrics that isn’t very industry dependent, though we look at some secondary metrics to judge it.
We are usually comfortable with creative that has a CTR of 0.7% — 3%. That’s a pretty big range, so let’s set some ground rules:
First off, at a minimum — we should be aiming for creative that’s close to 0.7%-1%. Anything below that, we usually consider pausing the creative altogether or using it with another audience.
Secondly, we’re okay with a higher CTR (or one that’s at the low-end) as long as the Conversion Rate holds post click. CTR is a function of the familiarity and relevancy of the creative to the audience that it’s being shown to — but if it’s not relevant enough to the product or service that’s being advertised, then higher click-through-rates aren’t very useful.
So the simple rule here is to aim for high CTRs that maintain or increase down-funnel conversion rates.
Click to Action Conversion Rate
Another metric to always monitor is the post-click conversion rate of an ad. This is calculated by the total number of unique conversions divided by the total number of unique clicks.
This metric is fairly industry dependent, and on top of that — very highly influenced by comment rates on the social post, the audience, and the relevancy of the creative that the user is clicking on. However, with all that — we’ve seen some trends in performance over the years.
The metric turns out to defer widely based on the goal and down-funnel action you’d like the user to take:
Lead / Form Completion
For consumers, prosumer, or B2B companies that are attempting to get a user to fill out a simple form (simple input such as name, email, and company) — we’ve consistently seen an average of 15%-30% conversion rate from click to lead completion.
As per all our benchmarks here, this is a rather wide margin — but usually with poorly set up campaigns, they turn out to be well below 15% or just roughly at the bottom of this range. So you’d like to be achieving around 20–30% conversion rate on average and above that on your best campaigns.
Install
For campaigns that are attempting to get people to have users install an app on their Android or iOS device (and not looking any further than that), we’ve seen an average of 20%-35% from a tap/click to an install.
Note: installs are tracked as “opens”. So even if a higher % of people actually install the app, only a portion of those users will ever open the app — which is how this metric is tracked.
Product Sign Up
For campaigns that are working towards getting the user to go through a user on-boarding (either after an install or a landing page view), we’ve seen an average of 20%-50% completion.
This range is higher than we’re comfortable with, but it’s very dependent on the relevancy of the audience and the medium. For mobile apps, the metric tends to be closer to 50% for well designed onboarding experiences, where for landing pages — it’s definitely on the lower end of this range.
Purchase / Payment
For campaigns that are attempting to get the user to enter any sort of payment information and/or complete a purchase, we’re seeing a very low range of 1%-3%. This fluctuates depending on the value-prop of the product, the relevancy of the product to the user, and the product’s price and commitment.
For great e-commerce campaigns, this trends towards the higher side and usually, those are the brands you’ll hear all about in the press as well. Having some name recognition helps with increasing the conversion rate of a direct response ad.
Cost of Install Performance
For app install campaigns for iOS and Android apps, we’ve seen a different range of installs that are somewhat industry dependent — but we haven’t seen a consistent pattern to present it to you per-industry.
A few years ago when Facebook was still in its early stages, we all remember getting very cheap installs — but currently, we’re seeing a range of $5-$30 per install.
Android tends to always trend on the cheaper side (if all devices are included), but becomes more or less the same as iOS if you’re targeting high-value device types.
The range is mostly dependent on scale of spend and how broad the app is for the general Facebook audience.
Cost of Acquisition Performance
Given the previous data we’ve provided, it’s somewhat possible to achieve the numbers below with some simple math of looking up average impression and click costs on Facebook — but to make it easier for you, these are the costs we’re seeing for different action goals.
Business Products
When it comes to advertising to businesses and selling them a SAAS product, we’ve seen a clear division of costs for the type of action we’d like them to take:
Sign Ups
If the main goal is to have the user to sign up and start using the product (usually a free trial of some sort), then we’ve seen a $50-$200 cost depending on the industry.
For highly competitive industries, or very niche industries — the price tends to be closer to the high-end of the range.
Leads
If the goal of the campaign is to receive demo requests and bookings to show the product to slightly larger companies, we’ve seen a range of $30-$200 per lead.
This has been a great way to help sales teams get an extra flow of leads to work with, and we’ve seen companies of any-size being prone to being able to be reached through this method.
Consumer Products
There’s a large array of actions consumer companies attempt to incentivize the user to do, though the most common of them are Sign Ups and Purchases:
Sign Ups
For sign-ups (i.e. creating an account for the product, signing up for a newsletter, etc.), we’ve seen a rather unhelpful range of $2-$20 depending on the strength of the brand and value-prop for the consumer.
This is a useless benchmark for us to give out since it’s very dependent on the subsegment of the consumers you’re going after and how painful the problem you’re solving for them is. The more unique and differentiated the product, the cheaper this turns out to be!
Purchases
Getting a consumer to put their credit card somewhere and order something turns out to be very unpredictable as well.
It’s a function of the product price, market, and the strength of the brand. We’ve seen a range of $6-$120 in the past year on variety of products and services being sold to consumers. Unfortunately, the range here also varies widely due to the same factors — unique product differentiation, product’s price, and competition in the market for the product!
What is Pearmill?
Pearmill is a digital advertising performance agency focused on user acquisition for technology, and consumer product companies.
We’ve worked with a large range of clients of different types and believe in our internal process that helps us achieve great results. Started by me (Nima Gardideh) and Karim El Rabiey — our team has been working on growth for 7 years on average!
If you’re looking for help growing through paid acquisition, feel free to reach out.