A Complete Reference for Performance, Growth, and AI-Led Discovery Formulas

Digital marketing platforms evolve, algorithms change, and tools get replaced. What stays constant is the need to measure performance, understand efficiency, and make informed decisions. That is where formulas matter.

Core Paid Marketing Metrics & Formulas

This section contains the foundational digital marketing metrics used across paid advertising platforms such as search ads, social ads, display, and marketplaces. These formulas help measure visibility, efficiency, conversions, and profitability.

Core Paid Marketing Metrics

Metric	Formula	What it Measures	Example
CTR – Click Through Rate	(Clicks ÷ Impressions) × 100	Measures how often users click after seeing an ad. Indicates message and audience relevance.	75 clicks from 3,000 impressions → (75 ÷ 3,000) × 100 = 2.5%
CPM – Cost Per Mille	(Total Cost ÷ Impressions) × 1,000	Cost paid for every 1,000 ad impressions. Used mainly for brand awareness.	GBP 25 spent for 5,500 impressions → CPM = GBP 4.5
CPC – Cost Per Click	Total Cost ÷ Total Clicks	Average cost paid for each click generated by an ad.	150 clicks at GBP 2.2 → Total cost = GBP 330
CR – Conversion Rate	(Conversions ÷ Clicks) × 100	Percentage of clicks that result in a conversion.	10 conversions from 250 clicks → CR = 4%
CPA – Cost Per Action / Acquisition	Total Cost ÷ Conversions	Cost incurred for each conversion achieved.	GBP 600 spent for 15 conversions → CPA = GBP 40
CPA (Expanded)	Total Cost ÷ (Impressions × CTR × CR)	Shows how CPA is derived from impressions, CTR, and conversion rate.	Used for funnel-level analysis
CPL – Cost Per Lead	Total Cost ÷ Leads	Cost paid for each lead generated. Used in lead-gen campaigns.	GBP 500 spent for 50 leads → CPL = GBP 10
eCPM – Effective Cost Per Mille	(Total Revenue ÷ Impressions) × 1,000	Revenue earned per 1,000 impressions, regardless of pricing model.	USD 50 revenue from 10,000 impressions → eCPM = USD 5
eCPC – Effective Cost Per Click	Total Revenue ÷ Clicks	Revenue generated per click. Used to evaluate monetisation efficiency.	USD 200 revenue from 100 clicks → eCPC = USD 2
eCPA – Effective Cost Per Action	Total Revenue ÷ Conversions	Revenue generated per conversion. Used to judge CPA campaign profitability.	USD 300 revenue from 15 conversions → eCPA = USD 20
ROI – Return on Investment	(Revenue – Cost) ÷ Cost	Overall profitability of a campaign or activity.	(2000 – 500) ÷ 500 = 300% ROI
ROAS – Return on Ad Spend	Revenue ÷ Ad Spend	Revenue generated for every unit spent on advertising.	USD 50,000 revenue from USD 10,000 spend → 5:1 ROAS
ACOS – Advertising Cost of Sale	Ad Spend ÷ Revenue	Percentage of revenue spent on advertising. Common in eCommerce.	Rs. 5,500 spend on Rs. 87,000 revenue → 6.3% ACoS
AOV – Average Order Value	Total Revenue ÷ Conversions	Average value of each transaction.	Rs. 75,000 revenue from 15 orders → Rs. 5,000
I2C – Impressions to Conversion %	(Conversions ÷ Impressions) × 100	Measures how impressions directly convert into actions.	150,000 conversions from 252,643 impressions → 60%
Impression Share	Impressions ÷ Eligible Impressions	Percentage of total possible impressions your ads received.	101,692 ÷ 252,643 → 40%
Ad Rank	CPC Bid × Quality Score	Determines ad position and eligibility in search auctions.	Higher Ad Rank improves visibility
RPC – Revenue Per Click	(Revenue + Goal Value) ÷ Clicks	Average revenue generated per click.	USD 500 revenue from 250 clicks → USD 2 RPC

Paid Media Economics & Funnel Metrics

Metric	Formula	What it Measures	Example
CAC – Customer Acquisition Cost	Total Marketing Cost ÷ Customers Acquired	Average cost to acquire one paying customer across channels.	Rs. 1,00,000 spend for 200 customers → Rs. 500 CAC
LTV – Lifetime Value (Economic Constraint)	CPC ÷ Conversion Rate < LTV	Ensures acquisition cost stays lower than lifetime value. Used as a bidding constraint.	If LTV = Rs. 500 and CR = 2%, max CPC = Rs. 10
Cost per Transaction	Total Cost ÷ Transactions	Cost incurred for each completed transaction.	Rs. 5,000 cost for 25 transactions → Rs. 200 per transaction
Average Cost of Sale (ACS / ACoS variant)	Total Cost ÷ Total Revenue	Shows how much it costs to generate one unit of revenue.	Rs. 5,500 cost on Rs. 87,000 revenue → 0.063
Funnel Conversion Rate	Final Conversions ÷ Total Funnel Entries	Overall efficiency of the funnel from entry to conversion.	100 conversions from 2,000 visitors → 5%
Funnel Efficiency	Revenue ÷ Total Funnel Cost	Measures how effectively spend converts into revenue.	Rs. 2,00,000 revenue from Rs. 50,000 spend → 4x
Impressions → Clicks → Conversions Chain	Impressions × CTR × CR = Conversions	Shows how traffic volume, CTR, and CR combine to drive outcomes.	10,000 × 2% × 5% = 10 conversions
Revenue per Visitor (RPV)	Total Revenue ÷ Total Visitors	Average revenue generated per visitor.	Rs. 1,00,000 revenue from 10,000 visitors → Rs. 10 RPV
Break-even CPA	LTV × Gross Margin	Maximum CPA allowed before losing money.	LTV Rs. 1,000 × 50% margin → Rs. 500 CPA cap
Retention Rate	Returning Customers ÷ Total Customers	Percentage of customers who return over a given period.	300 returning customers out of 1,000 → 30% retention

SEO Optimisation Metrics Formulas

This section covers SEO-specific formulas commonly used by SEO professionals, content teams, and analysts. These formulas help with keyword analysis, content optimisation, reporting, and automation.

SEO & Formulas

Term	Formula / Syntax	What It Does	Example
Keyword Density	(Nkr ÷ Tkn) × 100	Calculates how frequently a keyword appears in a text.	15 uses in 500 words → 3%
Keyword Density Variables	Nkr = keyword count, Tkn = total words	Defines variables used in density calculation.	Used for clarity

Google Analytics & Measurement Metrics

This section covers day-to-day website analytics metrics used to measure user behaviour, engagement, and goal performance.

Google Analytics Metrics

Metric	Formula	What It Measures	Example
Pages per Session	Pageviews ÷ Sessions	Average number of pages viewed during a session.	3.5 pages/session
Bounce Rate	Bounces ÷ Sessions	Percentage of sessions where users leave after viewing one page.	46.7%
Average Session Duration	Total Session Duration ÷ Sessions	Average time users spend on the site.	50 seconds
Goal Conversion Rate	Goal Completions ÷ Sessions	Percentage of sessions that resulted in a goal.	5%
Goal Abandonment Rate	(Goal Starts − Goal Completions) ÷ Goal Starts	Percentage of users who abandon goals.	40%
Exit Percentage	Exits ÷ Pageviews	Exit rate per page.	30%
New Sessions %	New Users ÷ Sessions	Percentage of sessions from new users.	60%
Ecommerce Conversion Rate	Transactions ÷ Sessions	Percentage of sessions that convert.	2%
Cost per Transaction	Total Cost ÷ Transactions	Cost incurred per transaction.	Rs. 200
EPC – Earnings Per Click	(Revenue + Goal Value) ÷ Clicks	Revenue generated per click.	Rs. 20

Growth & Strategy Formulas

Growth & Strategy Metrics

Metric	Formula	What It Measures	Example
Growth Equation	(Traffic × Conversion Rate × LTV) − CAC	Core business growth model.	Higher CR or LTV increases growth
Growth Leverage Ratio	Highest Impact Variable ÷ Lowest Impact Variable	Identifies optimisation leverage.	Improving weakest metric unlocks scale
Market Message Fit	(Problem Intensity × Clarity) ÷ Alternatives	Clarity of positioning.	Improves conversion and recall
Retention Rate	Returning Customers ÷ Total Customers	Customer retention.	30%
Churn Rate	1 − Retention Rate	Customer loss rate.	70%
ARPU	Total Revenue ÷ Total Users	Revenue per user.	Rs. 50
Payback Period	CAC ÷ Monthly Revenue per Customer	Cost recovery time.	3 months
Scalability Ratio	Incremental Revenue ÷ Incremental Cost	Growth efficiency.	> 1 = scalable
Retention-Adjusted LTV	ARPU × Gross Margin × Customer Lifespan	Realistic lifetime value.	Forecasting metric

SEO, AI & Discovery-Era Formulas

SEO, AI & Discovery Metrics

Metric	Formula	What It Measures	Explanation
True Visibility	Search Presence + AI Answer Presence + Brand Recall	Overall discoverability.	Beyond rankings
AI Answer Inclusion Probability	Entity Clarity × Citation Signals × Structured Content	Likelihood of AI inclusion.	Improves answer visibility
Prompt Surface Area	Topics × Questions × Content Formats	Prompt coverage.	More coverage = more discovery
Content ROI (Modern)	Prompt Coverage × Reusability × Shelf Life	Long-term content value.	Evergreen compounding
Information Density	Value Delivered ÷ Words Used	Content efficiency.	Improves extraction
Attention Efficiency	Value Delivered ÷ Time Required	Speed to value.	Faster answers perform better
Citation Strength	Trusted Mentions × Consistency	Reference reliability.	Builds trust
Entity Clarity Score	Defined Entities ÷ Ambiguous Mentions	Entity definition strength.	Improves AI comprehension
Answer Match Rate	Relevant Answers ÷ Total Prompts Tested	Answer appearance frequency.	GEO testing metric
Zero-Click Coverage	AI Answers + SERP Features	Non-click visibility.	Top-funnel discovery

Brand, Trust & Authority Metrics

Metric	Formula	What It Measures	Explanation
Authority Score	Experience × Consistency × Verifiability	Credibility strength.	Trust compounder
Trust Signal Strength	Social Proof × Transparency × Accuracy	Trustworthiness.	Conversion driver
Brand Recall Loop	Distinctiveness × Repetition × Context	Recall likelihood.	Memory formation
Citation Reliability	Accurate Citations ÷ Total Citations	Reference quality.	AI trust signal
Author Credibility Index	Published Expertise × Topical Relevance	Author authority.	E-E-A-T support
Reputation Consistency	Positive Mentions ÷ Total Mentions	Sentiment stability.	Authority durability
Topical Authority Coverage	Covered Topics ÷ Total Relevant Topics	Expertise depth.	Dominance signal
Trust Decay Rate	Lost Trust Signals ÷ Total Signals	Trust erosion speed.	Risk indicator

How to Use This Cheat Sheet

For Performance Marketers

Use Section 2 to optimise ads, bids, and creatives
Use Section 3 to control CPA, CAC, and funnel efficiency
Track ROAS, ACoS, RPC, and break-even points before scaling

For SEO & Content Teams

Use Section 4 for SEO audits and optimisation
Use Section 5 to understand on-site engagement and exits
Use Section 7 to expand prompt coverage and AI visibility

For Founders & Growth Teams

Use Section 6 to evaluate scalability and leverage
Compare LTV, CAC, retention, and payback period before investing
Use authority and trust metrics to guide long-term positioning

For Analysts & Strategists

Combine metrics across sections to see full-funnel impact
Use economics and growth formulas to build forecasts
Track changes over time instead of isolated snapshots

How Often to Revisit These Metrics

Campaign metrics: daily to weekly
Funnel and economics metrics: weekly to monthly
Growth and authority metrics: quarterly

Final Notes

Digital marketing tools will continue to change. Platforms will rise and fall. What remains consistent is the need to measure, compare, and decide with clarity.

Formulas provide that clarity. They turn performance into patterns and actions into systems.

This cheat sheet brings together every essential digital marketing formula, from classic paid metrics to modern AI-era discovery models, in one place. It is designed to evolve without losing its foundations.

Quick Cheat Sheet of Digital Marketing Formulas