E : Earning
C : Amount of Clicks
PM : Page Impressions
UV : Unique Visitors
TV : Total Visitors
Earnings per Click:
... Eq. (1)EPC = E / C
Click through Rate:
... Eq. (2)CTR = ( C / PM ) * 100%
Performance of your ads is the product of EPC and CTR:
... Eq. (3)(10) * EPC * CTR = CPM
where 10 = 1000 page impression / 100%
Cost per 1000 Page Impression:
... Eq. (4)CPM = ( E / PM ) * 1000
To measure how well your site benefits from Adsense, other parameters (UV and TV) will need to be considered. We'll need more data than those provided by Google. By introducing Unique Visitors (UV) and Total Visitors (TV), which you should manually implement a seperate tracking system.
Ads/Page Impression seen per visitor:
... Eq. (5)APV = PM / UV
Using the same method above such as equation (2), (3), (4). We can deduce (on average) how much each unique visitor benefit us.
Earning per 1000 Unique Visitor:
... Eq. (6)E / UV (*1000) = CPM * APV
E/UV is a good way to:
- measure how suitable your site is with Adsense. (useful if used to compare results across different sites)
- measure the quality of your site with respect to EPC, since CPM is the product of EPC and CTR.
- gives a good "idea" of how "demanding" your site contents are.
Clicks per Unique Visitors:
... Eq. (7)C / UV (*100%) = CTR * APV
C/UV is helpful in:
- learning what percentage of visitors are likely to click on your ads.
- measurement of how well are the placement of ads on your site. (compare this everytime you change your ads positions)
- setting a goal or target to the amount of traffic your site require to obtain your target earning amount. And using this as a guide to in your marketing tasks.
Errors/Failures Calculations (assume n-number of ads per page):
... Eq. (8)TV ≈ 1/n * PM
All these calculations requires data collection over a period of time. You should compare different sets of data to better understand your Adsense Performance.