Assumptions and Formulas

Before you get started evaluating the results of the Display Advertising Campaign, let's walk through some assumptions you will want to consider when creating your calculations.

Assumptions

1. Marketing Objective

The marketing objective for this advertising campaign is to sign students up to take the Digital Marketing Nanodegree Program

2. Program Price

Let's make the assumption that the cost to every new student that signs up for the Digital Marketing Nanodegree Program is $999.

3. Profit Margin

For this project, let's make an assumption that the profit margin on the program is 30%. That means that we make 30% profit on each new student that signs up. That is a profit gain of $299 per student that signs up.

4. Conversion

Let's assume that we achieved 0.2% Conversion via the landing page. This means that .2% of traffic to the landing page converted.

Formulas

1. Calculating the Number of Student Sign-ups

To calculate the number of student sign-ups multiply the number of clicks to the landing page (the traffic) by 0.002.

• (Traffic * .002) = Number of Student Sign-ups

2. Calculating CPA (Cost Per Acquisition)

To calculate the Cost Per Acquisition divide the total Cost of Campaign by the number of student sign-ups.

• CPA = Cost of Campaign/Number of Student Sign-ups

3. Calculating the ROI (Return-on-Investment)

Calculating the ROI will require two steps. First, subtract the total profit for each sign up from the CPAc calculated above. Then, multiple that result by the number of student sign-ups to achieve total ROI.

• ** ROI = [($299 Profit) - CPA] * Number of Student Sign-ups**