A U.S. retailer was spending $50 million a year bidding across a million keywords on Google. This spend drove $500 million of sales (equivalent to a ROAS, or return on ad spend, of 10). They were very pleased with the results and were planning to increase their spend.
Measuring Your Algorithm’s Performance
The right approach can help you spot where resources are being wasted — and how the system can be improved.
September 14, 2022
HBR Staff/Unsplash
Summary.
Understanding how to evaluate and manage algorithmic performance could be the difference between success and failure. This article outlines a six-step approach for defining what to measure and monitor. Central to this approach is to work out where the waste is by measuring failure states. These are critical to monitoring performance, prioritizing enhancements and understanding if actions are actually improving performance.