February 28, 2019

Ross Yaeger photo

There’s one reality that every sales rep runs into when becoming a great digital salesperson:

You’re going to have to do some math.

To be clear, it’s not complicated math. And for those of us who do not enjoy spending our time working on calculations, I say: Don’t be intimidated!

Sure, if you read this blog post and never revisit the calculations, the formulas you need for digital sales may feel out of reach. But, if you write down these formulas, tape them to your office wall so you can review them – maybe even try some metrics-calculating practice sessions with your underwriting or digital team – they will become second nature to you.

Calculating CPM

Our first essential calculation is CPM, one of the most frequently used digital calculations:

Revenue = ( Impressions / 1,000 ) x CPM

This is one of those key metrics that everyone selling digital needs to know backwards and forwards.

Let’s look at an example of calculating revenue from impressions and CPMs.

If an underwriter wants to purchase 100,000 impressions at a $9 CPM, then…

( 100,000 / 1,000 ) x $9 = $900 in revenue

You can also rearrange this formula to calculate for impressions or CPMs:

Impressions = ( Revenue / CPM ) x 1,000

CPM = ( Revenue / Impressions ) x 1,000

[Continued below…]

Manage digital buyers and agencies

Calculating Click-Through Rate (CTR)

Click-through rates are used to measure the percentage of displayed ads that are clicked by users. CTRs aren’t the best way to measure a campaign’s success, but they do come up in conversation a fair amount. As a result, you should be ready to calculate them if needed.

Here is the formula to calculate CTR:

CTR = Clicked ads / Displayed ads

So, if an underwriter ran a campaign that displayed 250,000, and received 575 clicks…

575 / 250,000 = 0.23% CTR

As this example shows, CTRs are frequently smaller than 1%.

Calculating Pages Per Visit (PPV)

This calculation can show can show how engaged your audience is, so it’s a good metric to be familiar with. Sites with high PPVs can comfortably point out that they have an engaged audience. Most public media sites have a PPV of two to three pages. If your site has a PPV higher than three pages, it’s probably worthwhile to get in the habit of sharing this metric with your clients. Many stations are able to produce reports that include pages per visit, but it’s a worthwhile calculation to memorize because, over time, account representatives are often asked to calculate it on the fly or discuss it during a meeting.

PPV = Pageviews / Website sessions

If a website has 2 million page views and 800,000 sessions, then…

2,000,000 / 800,000 = 2.5 pages per visit

2.5 is a fairly common PPV for public media stations.

Calculating Share of Voice (SOV)

SOV tells us what percentage of ads an underwriter will own on a site during a given time period. Underwriters will frequently want to know what percentage of ads they’re buying, so this calculation is a good one to memorize. Campaigns with a high SOV will give an increased brand lift to the campaign.

SOV = Impressions for underwriter / Total website impressions

We could consider a website that has 5 million monthly impressions where an underwriter is buying 25,000 impressions.

250,000 / 5,000,000 = 5% SOV

A 5% share a voice means that if the underwriter reloaded the website 100 times, they’d likely see their ads in approximately 5% of the page loads.

You could also use this SOV formula to calculate the impressions for an underwriter if you know the SOV and the total website impressions:

Impressions for underwriter = SOV x Total website impressions

This can be helpful for sites that are selling a percentage of inventory to underwriters rather than guaranteeing a set number of impressions or selling by CPM.  

Manage digital buyers and agencies
Ross Yaeger photo