Lesson 1 of 5
Marketing foundations: funnels, channels and the numbers
2 min read
The marketing funnel
| Stage | Goal | Typical channels | Metrics |
|---|---|---|---|
| Awareness | people discover you | social, video, display ads, PR, SEO | reach, impressions, video views |
| Consideration | people evaluate you | content, search, retargeting, reviews | CTR, time on site, engagement |
| Conversion | people act (buy, sign up, apply) | search ads, landing pages, offers | conversion rate, CPA, ROAS |
| Retention | they come back | email, WhatsApp, app push, loyalty | repeat rate, churn, LTV |
| Advocacy | they recommend you | referrals, reviews, community | referrals, NPS |
Owned, earned and paid media
- Owned: your website, app, blog, email list, social profiles.
- Earned: press, reviews, shares, word of mouth.
- Paid: ads, sponsorships, influencer posts.
The metrics you must calculate in your head
- CTR (click-through rate) = clicks ÷ impressions. 200 clicks on 10,000 impressions = 2%.
- CPC (cost per click) = spend ÷ clicks.
- CPM (cost per thousand impressions) = spend ÷ impressions × 1,000.
- Conversion rate = conversions ÷ clicks (or visitors).
- CPA / CAC (cost per acquisition / customer acquisition cost) = spend ÷ conversions.
- ROAS (return on ad spend) = revenue from ads ÷ ad spend. ₹50,000 revenue on ₹10,000 spend = 5× (or 500%).
- LTV (customer lifetime value) ≈ average order value × purchases per year × years retained × margin.
- Healthy businesses aim for LTV : CAC ≥ 3 : 1.
Worked example: ₹20,000 spend, 400,000 impressions, 6,000 clicks, 240 sales at ₹1,500 average order value. CPM = ₹50. CTR = 1.5%. CPC = ₹3.33. Conversion rate = 4%. CPA = ₹83. Revenue = ₹3,60,000, so ROAS = 18×.
Know your customer
Define the target audience (who, problems, motivations, where they spend time online), positioning (why you over alternatives) and a clear value proposition. Most failed campaigns fail here, not in the ad settings.
Check yourself
- Calculate CTR, CPC and CPA for: ₹5,000 spend, 100,000 impressions, 1,500 clicks, 30 sign-ups.
- What's the difference between ROAS and ROI?
- Which funnel stage would a YouTube brand video target?
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