Having good performance targets is essential for maximizing the value of Fospha's analytics platform, and your marketing budget.
These targets serve as critical benchmarks for measuring success, guiding your marketing strategies, and optimizing your overall performance.
By focusing on meaningful and achievable performance targets, you can ensure that your marketing efforts align with your broader business goals, ultimately driving better returns on investment and growth.
Setting and Understanding Targets
Available performance targets in Fospha are:
Target | Calculation |
Cost Per Purchase (CPP) | Total Cost / Total Purchases |
Customer Acquisition Cost (CAC) | Total Cost / New Purchases |
Return on Ad Spend (ROAS) | Total Revenue / Total Cost |
When setting performance targets, it's important to establish:
Blended ROAS/CAC and CPP values (provided by you)
Paid ROAS/CAC and CPP values (calculated by us)
These will help you measure your overall performance and guide your channel-specific strategies.
You can provide blended values to our customer success team, who can assist with calculating the appropriate paid targets.
Blended vs. Paid Targets: What’s the Difference?
Blended Targets: These refer to the overall performance across all channels, calculated using aggregated metrics from across your marketing mix, including organic channels
Paid Targets: This refers to the performance of paid channels, calculated using aggregated metrics from your paid channels only
From your blended overall target, we can determine the performance needed from your paid media, based on its contribution to revenue.
For example, if 50% of your revenue comes from paid media, achieving a 1.5 ROAS on paid activities can still help you meet a 3.0 blended ROAS overall. This balance ensures that your marketing spend is optimized across channels.
Practical Example
Blended ROAS Target: 3.0
Paid Media Revenue Contribution: 50%
Paid ROAS Target: 1.5
Using this approach, you can calculate the necessary performance across your channels, ensuring your paid media activities contribute effectively to your overall goals.
Optimizing Your Marketing Mix
To maximize volume while staying within your performance targets, you should continuously monitor and adjust your marketing mix. Here's how:
Underperforming Targets: If you find that your performance is below target, focus on optimizing spend. This could mean reallocating budget away from underperforming activities or decreasing spend in saturated channels to improve overall performance. However there are scenarios where your biggest volume channels are below target, and that could be ok – read on below for our best practice in this scenario.
Exceeding Targets: When performing better than the target, explore opportunities to increase volume by investing more in channels with room to grow above the target.
Your marketing mix will typically include different types of activities with varying levels of performance. It's acceptable for some channels, especially larger ones, to perform below your paid ROAS target as long as you achieve the overall paid media target across your entire mix.
Example
Paid Media ROAS Target: 2.0
Channel | Spend | Revenue | ROAS |
Paid Social / Meta | £100,000 | £180,000 | 1.8 |
Affiliates / Awin | £25,000 | £70,000 | 2.8 |
Total Paid | £125,000 | £250,000 | 2.0 |
In this scenario, Meta drives the majority of the revenue, while Awin contributes more efficiently.
Although Meta has a lower ROAS, it plays a vital role in volume, while Awin's performance ensures the overall target is met.
Next Steps
To ensure your targets are set correctly and to optimize your use of Fospha, we encourage you to submit this form.
If you have questions, please reach out to your CSM. They can provide personalized assistance and ensure that your targets are accurately reflected in the platform.