When it comes to measuring the success of your pay-per-click (PPC) program, these are the top metrics to monitor.
Here, you’ll find:
- Ways to determine your specific PPC goals
- How your goals relate to your KPIs
- Tips for evaluating your business’s definition of success
- Common KPIs used to measure PPC campaigns
Are you measuring key performance indicators (KPIs) for your marketing campaigns?
If you’re unsure how your campaigns are really performing or you’re struggling to measure the effectiveness of your campaigns, it may be time to revisit your KPIs.
KPIs give your business an effective, measurable way to track your campaigns’ progress and performance. In the case of a PPC campaign, you want to be sure that you’re seeing a reasonable return on your overall investment.
By establishing PPC KPIs, you can create goals in Google Analytics that connect with your Google Ads. This way, you’ll have visibility into campaign performance and can begin sourcing accurate data right from the start.
If you haven’t yet determined what you’re trying to accomplish with your campaign, here are some factors to consider.
What is your PPC campaign trying to accomplish?
Typically, the goal of a PPC campaign is to raise awareness of your brand and to encourage customers to click through the ad to your website over your competitors’.
Your PPC campaign may focus on a specific stage of the buyer’s journey or encompass specific keywords that are related to your product or service.
When determining what KPIs to track, make sure you’ve clearly defined what you’re trying to accomplish with the campaign.
For example, if you’re creating a top-of-funnel campaign to raise brand awareness or spread information about a new product or solution, you may want to focus on direct clicks more than conversions.
What does “success” look like for your marketing program?
Every industry — and every brand within those industries — has a different measure of success. A brand that has a significant marketing budget, for example, may have higher goals and be willing to spend more on a campaign.
If you sell high-dollar products or services or see a significant customer lifetime value (CLV), you may be able to spend more to acquire a single customer than if you’re a small business with relatively low-price items or a lower CLV.
When you’re first deciding on goals, consider your past marketing achievements as well as what you want this specific campaign to accomplish.
Ideally, you want to boost ROI through new sales. But if your goals are more focused on raising brand awareness or bringing customers to your website, you may not see that kind of return in the early stages of your campaign.
You also don’t have to start with your final goal, as Search Engine Journal explains. You can start by raising awareness or building your email list in the hopes that the end result over time will be more sales.
Common KPIs to help track PPC campaigns
Looking at common PPC KPIs used to measure a campaign can give you a better idea of what to focus on when evaluating your campaign.
Clickthrough rate (CTR)
CTR measures how many people clicked on your ad after seeing it. You can assess clickthrough rate by taking the total number of impressions (the number of times the ad was seen) and dividing it by the number of clicks it received.
For a view to qualify as an impression, the consumer doesn’t have to take any action or interact with the ad.
However, the clickthrough rate can give you a better idea about what percentage of people you can expect to click through an ad based on the number of times it’s been seen.
Cost per click
The cost per click determines how much it costs you when someone clicks on your ad. In the competitive digital ad space, particularly when it comes to specific, high-volume keywords, you may pay more per click than you would in the case of lower-frequency keywords.
However, those higher costs may be well worth it when you end up with a better overall return on your investment for critical keywords than you do for low-volume keywords.
Cost per conversion
As customers click through your ad, some of them will explore your site, join your mailing list, or even make a purchase. How much does it cost to convert customers through those ads?
Your cost per conversion will naturally be higher than your cost-per-click rate.
Not every customer who clicks through your ad will choose to convert, whether that means joining your list or making a purchase from your business.
Notice that your cost per conversion is higher on a specific type of campaign, or based on specific keywords? You may want to consider revisiting those keywords or the elements of your campaign.
This way, you can potentially create a more effective campaign that has a higher return on your investment.
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Not only do you want to know the cost per conversion, but it’s also important to know how many prospects actually convert.
If you notice your conversion rate decreasing — that is, that people are clicking through the ad, but not choosing to make a purchase from your business or to sign up for your mailing list — consider why.
Is your campaign focusing on the wrong keywords? Does your landing page fail to deliver the information customers need, or not provide them with an effective call to action? Keep a close eye on your conversion rate as you consider the performance of your campaign.
Pro tip: Quality Score is another KPI worth looking into. While this score is determined by Google, it’s based on factors like your expected CTR, ad relevance, and landing page experience. A higher quality score means you could rank higher while spending less.
The last thing you want is to pour money into a PPC program without a clear goal in mind.
Having key performance indicators helps you measure success and better pinpoint strengths and weaknesses in your campaigns.
By knowing what PPC KPIs are most important to your brand, you can build a solid plan to help ensure your goals are met.
This article has been updated and was originally published in July 2020.