How to read an ad account in ten minutes
The four screens that tell you whether money is working, and the vanity numbers that will waste your afternoon.
Most people open an ad account and start at the top, which is the worst place to start. The top of the screen is where the platform puts the numbers that make you feel good. Reach. Impressions. Engagement rate. None of them tell you whether you made money.
Here is the order we actually use, and why. It takes about ten minutes and it works whether you are spending $500 a month or $50,000.
One: what came back per pound spent
The only opening question is how much money came back for each pound or dollar you put in. Every platform has a name for this and most of the names are jargon. Ignore the name and find the ratio.
If you spent $1,000 and the campaign is credited with $4,000, you got $4 back for every $1. Whether that is good depends entirely on your margin, which is the part almost nobody checks. A brand making 70% gross margin is comfortable at $2 back per $1. A brand making 20% is losing money at $4.
Two: what it cost to get one customer
The ratio hides volume. A campaign returning $8 per $1 on eleven orders is a rounding error. Look at the cost to acquire one paying customer, then compare it to what that customer is worth over a year.
If it costs $40 to win a customer who spends $60 once and never returns, you have a $20 business with a lot of admin. If that customer spends $60 four times a year, you should be spending far more than you are.
Three: which creative actually earned it
Sort by spend, not by performance. The platform will happily show you a beautiful result on an ad that received $30. What you want is the handful of pieces carrying most of the budget, because those are the only ones with enough data to mean anything.
- Anything under a few hundred pounds of spend is a rumour, not a result.
- If one piece is carrying 80% of spend, you do not have a creative strategy, you have one lucky ad and a countdown.
- Look at what the winners have in common. Usually it is the first two seconds, not the offer.
Four: what the landing page did with the click
This is where most accounts are actually broken, and it is the last place people look. Compare how many people arrived with how many reached the checkout. If the ads are doing their job and the page is not, no amount of budget fixes it — you are just buying more visits to a leaking bucket.
One caveat worth knowing: on some businesses the sale never happens on the page at all. We have run campaigns for a personalised-goods brand where the entire transaction happened in an Instagram inbox. Measuring page conversions there would have shown a broken account and a healthy business.
What to ignore
| The number | Why it is on the screen | What to look at instead |
|---|---|---|
| Impressions | It is always big and always rises with spend | Cost to reach one thousand people, tracked over time |
| Engagement rate | It measures whether people liked the post | Whether they clicked, and then whether they bought |
| Reach | It is the easiest number to grow and the easiest to buy | New customers, counted |
| Clicks | It counts a lot of accidents | Sessions that lasted longer than a bounce |
The ten-minute version
- Work out your break-even return from your margin. Write it down.
- Find what came back per pound. Compare it to that number, not to zero.
- Check the cost to win one customer against what a customer is worth over a year.
- Sort creative by spend and read only the top few.
- Compare arrivals to checkouts, unless your sale closes somewhere else.
If the account fails at step two, the problem is the offer or the margin, and no creative will save it. If it fails at step four, the problem is the page. Knowing which of those you have is most of the work.