There are some indisputable truths on PPC measurements that any practitioner can relate to:
This post is not meant to reveal “the ultimate PPC KPIs” or serve as “the definitive guide to PPC metrics once and for all”. Instead, see this as a useful starting point.
Looking at any one of these metrics alone will not give you the needed answers for optimizing your campaign, but at a universal level, each one can point you in the proper direction towards understanding:
I surveyed a few team members from my staff just to get their insights on “starting point metrics” and below are the most common ones:
At the core, this measurement is a very simple calculation:
Ad Spend / Conversions = Cost Per Conversion
It makes no difference whether it’s B2C retail, B2B manufacturing, ecommerce, local services, nonprofit, or another category.
When you start by looking at your cost per conversion, you can quickly see which campaigns might not look quite right.
Based on what you see here, you may decide to:
To state the obvious, not all conversions are created equal.
For example, a download of a whitepaper or research guide will have a different value than a prospect directly requesting a quote.
Generally, you should be willing to pay more for a customer wanting a quote than for one downloading a free guide. With that in mind, always remember “Cost Per Conversion” is not a “one-size-fits-all-campaigns”.
This measurement is also a simple calculation:
Conversions divided by clicks the ad receives = Conversion rate
Everyone. It makes no difference whether it’s B2C retail, B2B manufacturing, ecommerce, local services, nonprofit, or another category.
When you start by looking at your conversion rate early, you will see the highs and lows of various campaigns.
Start with the lowest ones. How did they perform in the current period vs. last month or last year? (If applicable.)
Just like the “cost per conversion” metric above, paying attention to this number will point the way to improving the campaign.
Based on what you see here, you may decide to:
Again, not all conversions are created equal. Therefore, some are naturally much easier to attain than others.
For example, in the consumer software world, converting someone to a free direct download of a trial version is much easier to than having a trial version that forces a user to enter personal information and a credit card up front that will automatically convert to a paid subscription after 14 days.
You will ultimately need to decide which method will lead to more paying customers.
Your ad campaigns are set up to (or at least they should all be) be seen by a specific audience with a specific intent.
This doesn’t guarantee that your ads will show 100 percent of the time the opportunity is available.
Simply put, if there were 100 opportunities that your ad could show (again, based on the criteria you specify) and it shows 80 times, then you have an 80 percent “search impression share”.
Everyone. It makes no difference whether it’s B2C retail, B2B manufacturing, ecommerce, local services, nonprofit, or another category. (Notice a pattern here?)
This isn’t the first metric you need to look at, but it should be near the top and a critical part of your analysis.
To state the obvious, you want your ad to show up for every applicable opportunity and see numbers on the report as close to 100 percent as possible.
A couple of common factors that play into this are:
Below is the same exact graphic as the one directly above this, but note the metrics in the line that’s highlighted.
The “search impression share” is 63 percent. This one is the most expensive in terms of CPC, total cost, and cost per conversion. Looking at the cost per conversion first would point you to dig deeper on this segment.
Some of the things this examination could lead you to might be:
For newer campaigns (especially in a highly competitive space), you’re trying to find your footing. Don’t panic if it’s low right out of the gate.
As you get more data, be prepared to take action, but try not to feel too defeated if the number doesn’t look as good that first month.
This measurement is an extension of what was covered in #3. Whereas the first three metrics were calculations, this one comes directly from Google.
Once again – everyone. It makes no difference whether it’s B2C retail, B2B manufacturing, ecommerce, local services, nonprofit, or another category.
This number is a clue that the path to scaling this segment may be easier than others.
The closer the number is to the difference between 100 and the “search impression share”, the more likely you are to find additional conversions simply by boosting the budget.
If, however, there is a significant gap, you have other issues (see #3 above).
In more than 15 years of PPC experience, I’ve yet to have Google tell me that I’m spending too much money! Just keep that in the back of your mind.
If this report tells you that you’ve lost 20 percent of search impression share due to budget, don’t automatically assume that increasing your spend will result in your other critical metrics remaining consistent (cost per conversion, conversion rate, etc.).
Huh?!? What does this mean?
Well, a conversion doesn’t always require a landing page.
The most obvious example of this would be a “call extension” that places a phone number directly in the ad.
To start, if getting phone calls or text messages are critical to your business, then you should set your ads up with those options.
If you’re doing that, then this is the first metric you should look at.
If the fastest way to earning a paid customer means getting a phone call or text message, then optimizing for that objective becomes your business lifeline.
In the context of the ad example above, a storm has taken out a tree in a someone’s yard and created a horrible mess.
The context of the query and intent of the searcher is very clear. That searcher wants to connect with someone quickly who can solve their problem.
The ad copy must clearly address the searcher’s need in order to earn that phone inquiry.
In this report, clicks do not equate to calls received. When clicking on the number in a mobile ad, the user is still prompted (by the device) to call the phone number.
Never rely on one single measurement to be the final arbiter of the success (or lack thereof) of your campaign. Instead, look for those singular measurements that can give you a place to start.
Always look to dig deeper to find the “why” that that helps you take action. Follow through on that action and over time you will see improvements to your PPC performance.
More Paid Search Resources:
In-Post Photo: RCarner / Can Stock Photo
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