We're constantly amazed by the number of marketers who get hung up on media math. Of course, it's complicated, with every media channel talking about different metrics -- Gross Rating Points (% reach x frequency), CPM (cost per mil, or thousand impressions), DEC, and those lovely new web figures, cost per click, conversion rates, etc. Here's a little secret: media channels use different metrics because they like to use the ones that make their channel look better than the other options.
So: How about cost per acquisition? It's simple. How much are you willing to spend to bring in one incremental customer?
You should be able to answer this, and then pass it to your ad agency or media planners, and hold them accountable. If one customer generates $1,000 in revenue and $300 in profit in the first year, you may be willing to spend, say, $400 to bring in a new customer (since more profit will flow in future years, and you need to replenish your base). That's your target cost per acquisition.
So, you have $400 in funds to bring in a customer.
If half goes to sales, then you have $200 to spend on marketing for each new customer.
And if only 1 in 4 customers is sold, you have $50 to spend for each lead (or inquiry).
$50. That's it. All of your media needs to drive a phone call or web lead form for $50 per inquiry. How's your direct mail doing? If it costs 50 cents per piece, you'll need a 1% response rate to get to a $50 call. How's newsprint? If one ad costs $5,000, you need 100 calls from a single ad to get to a $50 call.
Now, you have a single, common benchmark for every aspect of the media. Those old GRPs and CPMs are fine for planning. But if you really want to measure performance, you need to track action, not impressions. Everything else is just Monopoly money.
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