Firstly, never forget that you’re in the online world now. It’s certainly important to take a look at your campaigns individually and check how well each of them is running. However, remember that online results are far quicker and easier to calibrate than their offline equivalents, and as a result your campaign is automatically more manoeuvrable.

Let’s look at what some of these terms mean. Cost Per Action (CPA, also known as Cost Per Acquisition) is an advertising payment measurement model based on predefined actions, which are most commonly a sale, a request of some kind, or a registration. This cost is made up of number of clicks from the relevant paid search adverts required for each action.

The CPA model differs from the more common Cost per Click (CPC) in that to be successful you have to convert the traffic visiting your website into sales or requests. Briefly put, Cost per Click measures how many people you can entice onto a site whereas CPA measures how many people you can persuade to register their interest or purchase a product.

Return on Investment (ROI) is no doubt familiar to most of you from an offline context. This is your bottom line; how much you will get back for each unit spent. The big difference here is between SEO and PPC. PPC is easier to measure, as you are paying directly for traffic. As those running SEO campaigns will know, search engine optimisation involves a more indirect relationship between the time and money put into it, and any output. As Google and Yahoo! take time to register all the improvements that you make to your site, the positions of your site in their indexes are totally dependent on them. SEO, although vital, and better value to maintain in the long run will most often not show visible signs of paying off until six months or so have elapsed. We’re going to concentrate on Pay per Click in this article.

If you are running your own Pay per Click campaign, make sure you get a balanced picture of your campaign. Do not exclusively micromanage your campaigns at the expense of looking at the big picture. Remember to focus on your overall net profit. Sometimes, you can do better by selling volume than you will by concentrating on your margin, and sometimes spending some cash will produce great results.

Let’s say you’re selling holidays to the Caribbean . If each holiday costs the buyer £200 and you’re paying £20 per Conversion on your website, then your ROI is 10:1. Let’s say you sell 100 holidays that way, and you make £18,000 (before the price of the goods and overheads, of course!) Those numbers look pretty good, but maybe you want to spend more money on your PPC campaigns. Now, as you spread your net wider through the market it will probably get harder to maintain those numbers. Maybe you’re now paying closer to £50 per conversion; but perhaps in doing so you manage to up your total sales to 300 holidays. Your overall ROI has taken a bit of a hit here, and has fallen to 4:1, but on the other hand your profit has increased to £45,000. (ROI in this case is being measured as total sales rather than as sales margins, which would produce different results).

The beauty of internet marketing is that you can change the amount you’re paying for each click (and by extension, per action) in a second. If you increase your campaign budget but your new campaigns are unsuccessful then you can scale back your spending; similarly if you spot an opportunity then you can also instantly increase your click spend. This feedback loop is the crucial element of online marketing. Quicker results measurement allows quicker decision-making and more nimble campaigns. If offline marketing campaigns have the turning circle of an ocean liner, adjusting your online marketing campaigns is like steering a speedboat.

To run an online marketing campaign that is as successful as possible, you have to take the opportunity to test your campaigns to gain a clear understanding of your market. As pay per click is flexible and fast, it is easy to change your campaigns to take advantage of the market. Users who concentrate too much of their time on the results of each of the individual campaigns are missing an important trick.