To ensure your PPC campaigns are successful, it’s crucial to monitor key PPC metrics that gauge their performance. These metrics help you understand the effectiveness of your ads, manage your budget efficiently, and optimize your campaigns for better returns.
By focusing on these metrics, you can make informed decisions to enhance your PPC campaigns, improve your ads’ performance, and achieve better results over time.
Core PPC Metrics to Monitor
1. Clicks and Impressions
Let’s talk about how to see if your PPC ads are doing their job by looking at clicks and impressions. Here’s what you need to know:
Clicks
Clicks tell you how many people thought your ad was interesting enough to check out your website. You want to aim for a good number of clicks compared to how many times your ad was shown (that’s your click-through rate or CTR). If less than 1% of the people seeing your ad are clicking on it, you might need to make your ad or website better.
Impressions
Impressions are about how many times your ad pops up for people. If this number is low, it means not enough people are seeing your ad. This could be because your daily budget is too small or your bid amount isn’t high enough. You can use something called an auction insights report to figure out what’s going on.
Click-Through Rate (CTR)
CTR is a percentage that shows how many times your ad was shown versus how many people clicked on it. For instance, if your ad was shown 1,000 times and got 50 clicks, your CTR is 5%. Compare your CTR to others in your field to see how you’re doing. A dropping CTR means your ad might be getting less interesting over time.
Cost-Per-Click (CPC)
CPC is how much you pay each time someone clicks on your ad. Keeping an eye on this helps you manage how much you’re spending. You can lower your CPC by using negative keywords, adjusting bids, or making your ads better. See how your CPC stacks up against the recommended bid.
Return on Ad Spend (ROAS)
To figure out your ROAS, divide the money you made from your ads by how much you spent on them. This number tells you if you’re making a profit. For example, a ROAS of 3 means you’re making $3 for every $1 you spend. You should aim for a ROAS of at least 2.
Keep an eye on these basic PPC metrics to make sure your ads are working well. If you notice any worrying trends with your clicks, CTR, or ROAS, it might be time to adjust your targeting, bids, budget, or ad copy.
2. Click-Through Rate (CTR)
Click-Through Rate, or CTR, is like a score that shows how often people click on your ad after they see it. You figure it out by this simple math:
CTR = (Clicks / Impressions) x 100
Where:
- Clicks = How many times people clicked on your ad
- Impressions = How many times your ad was shown
Some key things to know about CTR:
- A higher CTR means your ad is doing a good job catching people’s attention. They see your ad and want to learn more.
- CTR can be different depending on what you’re selling. It’s a good idea to see how your CTR compares to others who sell similar things.
- If your CTR starts to go down, your ad might be getting stale. This is a hint to try new things in your ad to keep it interesting.
- A good CTR can also make your ads cheaper. It’s part of what Google looks at to decide how much you pay per click.
- As a basic goal, try to have a CTR of at least 1-2%. If it’s below 1%, it might mean your ad isn’t showing up enough or isn’t appealing.
Tips to improve CTR:
- Try out different titles and descriptions in your ads to see what works best.
- Make sure your ad has a clear, attractive offer.
- Use nice pictures or graphics.
- Make sure you’re showing your ad to the right people who are interested in what you’re offering.
- Make your landing page (the page people go to when they click your ad) better so they’re more likely to do what you want them to do.
Keeping an eye on your CTR and tweaking your ads can help you get more clicks and make your ads more effective without spending more money.
3. Cost Per Click (CPC)
Cost Per Click, or CPC, is how much you spend each time someone clicks on your ad. It’s important because it helps you figure out the best way to use your budget and get the most out of your ads.
What CPC Tells You
- It shows if the keywords you’re using are in high demand. A high CPC means a lot of people want those keywords.
- It helps you see if your ads and the pages they go to match what people are looking for. If they don’t match well, you might pay more per click.
- It lets you know if your daily budget is enough. If your CPC is high, you might need to spend more each day.
Tips to Lower CPC
- Use negative keywords to keep away clicks that won’t help you.
- Make sure you’re targeting the right people who are actually interested in what you’re offering.
- Work on making your ads more relevant to what people are searching for.
- Check that your landing pages give people what they’re expecting to find.
Benchmark CPC Against Competition
- Look at what others are paying for similar keywords to get an idea of what’s normal.
- Remember to consider things like your industry and how good your landing page is when you compare.
Optimize Bids Around Profitability
- Spend more on keywords that bring you sales, and less on those that don’t.
- Figure out the best CPC for making a profit by looking at how much you earn from your ads compared to what you spend.
Keeping an eye on CPC is a smart way to make sure you’re not spending too much for clicks and to find chances to do better with your ads. Learning how to manage your CPC can help you save money and spot new opportunities.
4. Conversion Rate
Conversion rate is super important when you’re running ads because it tells you if those ads are actually getting people to do what you want, like buying something or signing up for a newsletter.
Here’s a simple way to figure out your conversion rate:
Conversion Rate = (Total Conversions / Total Clicks) x 100
So, if 50 people did what you wanted after clicking on your ad 500 times, your conversion rate is 10% (50 / 500 x 100).
What conversion rate tells you
- If your website and the page where your ad sends people are convincing them to take action
- Whether your ads are reaching the right people
- If you need to work on your ad or the page it sends people to
Tips for improving conversion rate
- Try changing your ad to see if it gets more people to click who are really interested
- Make sure the page you’re sending people to is clear about what you want them to do
- Add more info about what you’re offering so people know exactly what they’ll get
- Look at making it easier for people to do what you want on your page
- Use your website’s analytics to find out where people stop and try to fix those spots
Benchmarks for conversion rate
- SaaS: A normal rate is between 2-5%
- Ecommerce: Usually, around 2-3% is normal
- Lead gen: Between 5-15% is good, depending on what you’re offering
Check how your conversion rate compares with others in your field. If it’s lower than others, try the tips above to get better results. Keeping an eye on this number is key because more conversions mean more success for your business.
5. Cost Per Acquisition (CPA)
Cost Per Acquisition (CPA) is a key number that tells you how much you’re spending to get a new customer through your PPC ads.
Here’s how to figure it out: Take the total money you spent on PPC ads for a certain time, and divide it by how many sales or sign-ups you got from those ads.
Formula:
CPA = Total PPC Spend / Total Conversions
For instance, if you spent $1,000 on PPC ads last month and got 10 sales, your CPA is $100 ($1,000 / 10 sales).
Why CPA is Important
- It shows if you’re spending your money wisely. A lower CPA means you’re making more profit.
- It helps you see if your ads are reaching the right people.
- It tells you if tweaking your ads or website is working.
How to Spend Less on CPA
- Make your ads clearer to attract people who are really interested.
- Add negative keywords to avoid wasting money on clicks that won’t convert.
- Make your website better so more people will buy or sign up.
- Play around with how much you bid for ads to find a sweet spot between spending and earning.
What’s a Normal CPA?
- For Google Shopping Ads, it’s usually over $150.
- For getting leads, it’s between $50-$100.
- For SaaS (software as a service), it’s between $200-$300.
- For online stores, try to keep it below 2-3 times what people spend on average.
Compare your CPA with these average numbers. If yours is higher, try the tips above to get more bang for your buck in your PPC campaigns.
6. Quality Score
Quality Score is like a grade Google gives your ads. It looks at how well your ads match what people are searching for, how likely people are to click on your ads, and if they stick around on your site after clicking. A better score means you might pay less for your ads and they could show up in better spots.
What affects your Quality Score
- How well your ads, keywords, and landing pages match
- How often people click on your ad (CTR)
- If people stay on your site after clicking
How to get a better Quality Score
- Make sure your ads are clear and make people want to click
- Use keywords that match your ad text closely
- Direct people to landing pages that give them what they’re looking for
- Keep your website interesting so people stay longer
Check your Quality Score for each keyword
Google shows a score from 1-10 for each keyword (10 is the best). If a keyword has a low score:
- You might pay more for each click
- Your ad might show up lower on the page
Try to get Quality Scores of 8 or higher
Aim for scores of at least 8/10. If you see lower scores:
- Figure out why that keyword isn’t doing well
- Try changing your ad or landing page
- Consider pausing keywords with low scores to save on costs
Keeping an eye on Quality Scores can help you make your ads more relevant and improve your click-through rate while saving money.
7. Impression Share
Impression share is a way to see how often your ad gets shown when it could have. It helps you understand if your ads are getting enough attention.
What Impression Share Tells You
- It shows the percentage of times your ad is shown out of all the times it could have been.
- It helps you spot missed chances where your ad could have appeared.
- It lets you know how well your ad is doing against others.
Reasons for Low Impression Share
- Not enough budget – Try raising your daily budget or stop using keywords that aren’t doing well.
- Your ad rank is too low – Make your ads better or offer more money for clicks.
- You’re targeting too narrowly – Try to reach more people to get more views.
Tips to Improve Impression Share
- Pick better keywords and use match types smartly to make sure your ads match what people are searching for.
- Write ads that make people want to click.
- Make sure you’re tracking conversions so you can spend more wisely.
- Target your best customers with things like remarketing to get better results.
Keeping an eye on impression share can show you where you can do better. By understanding why your ad might not be showing as much as it could and working to fix those issues, you can get your ads in front of more people and hopefully get more clicks.
8. Return on Ad Spend (ROAS)
Return on Ad Spend (ROAS) is all about figuring out if the money you’re putting into your ads is actually bringing you enough sales. Think of it as checking if you’re getting a good deal from your ads.
Here’s a simple way to see your ROAS:
ROAS = (Money made from Ads / Money spent on Ads) x 100
For instance, if your ads cost you $1,000 and you made $3,000 in sales from those ads, your ROAS is 300% ($3,000 / $1,000 x 100).
What’s a solid ROAS to aim for:
- For getting leads, you want at least 200-300% ROAS
- If you’re selling products online, try for 250-400% ROAS
- Software companies might look for 100-200% ROAS
How to get better ROAS
- Make sure you’re tracking all sales to see how well your ads are doing
- Use negative keywords to stop wasting money on clicks that won’t buy
- Create ads that really speak to people ready to buy
- Make your landing pages better to turn more visitors into buyers
- Change how much you’re willing to pay for ads based on which keywords bring in sales
Why keeping an eye on ROAS is key
ROAS tells you straight up if your ads are worth it. If your ROAS is low, you might be losing cash. Watching this number helps you decide the best way to spend your ad money.
Always shoot for a ROAS that’s good for your type of business. If it starts to drop, try the tips above to tweak and improve your ads. Staying on top of your return on ad spend is crucial for making more money.
9. Cost Per Mille (CPM) / Cost Per Thousand Impressions
Cost Per Mille (CPM), or the cost for every 1,000 times your ad is shown, is important if you want to understand how much you’re really spending on your PPC ads to get them seen.
What CPM Tells You
CPM lets you know the price you pay every time a thousand people see your ad. It’s useful for figuring out how much attention your ads are getting and the cost of that attention.
Why Track CPM
- It helps you see how far your ad is reaching.
- You can better plan your budget knowing the cost per thousand views.
- It’s good for comparing different types of ads, like those on Google versus Facebook.
- You can tweak who sees your ads to try and make the cost go down.
How to Calculate CPM
CPM = Campaign Spend / Impressions x 1000
For example, if you spent $60 and your ad was seen 20,000 times, your CPM is $3 ($60 / 20,000 x 1000).
Tips to Reduce CPM
- Make sure you’re tracking which ads lead to sales or sign-ups to spend your money smarter.
- Adding negative keywords helps avoid wasting views on people not interested in your ad.
- Experiment with different settings and places to show your ad to find the cheapest options.
- Look at your impression share to figure out if you’re missing out on potential views.
By keeping an eye on your CPM, you can get a clear picture of what you’re paying to have your ads seen. With a bit of investigation and some tweaks here and there, you can help your ads reach more people without spending more money.
10. Search Impression Share Lost (Rank and Budget)
When your ads aren’t showing up as much as they should, it’s often because of issues with either rank or budget. Let’s break down what that means and how you can fix it.
Impression Share Lost to Rank
This tells you if your ads are missing out because they’re not high enough in the search results. Think of it like not making it to the front row in a concert.
Easy fixes for a better rank:
- Make sure you’re bidding enough on the right keywords that bring in sales.
- Work on your ads and the pages they lead to, making them more about what people are searching for.
- Use negative keywords to stop your ads from showing up for searches that won’t help you.
Impression Share Lost to Budget
This one’s about how often you miss showing your ad because you’ve run out of budget for the day.
How to miss out less because of your budget:
- If you can, put more money into your best keywords.
- Think about lowering how much you bid on keywords that aren’t doing well, so you save money.
- Change who sees your ads so you’re more likely to reach people who will click and buy.
By keeping an eye on these two reasons you’re missing out on showing your ads, you can figure out what’s going wrong. Fixing issues with your rank and budget can help your ads reach more people who are likely to buy.
11. Conversion Value and Conversion Value/Cost
Conversion value and conversion value/cost are key numbers that tell you how much money you’re making from your PPC ads.
Conversion Value
Conversion value is just the total amount of money you make from sales or leads that come from your PPC clicks.
Here’s how to figure it out: If you got 100 clicks and 10% of those clicks led to a sale, and each sale is worth $50, then you made $500 from those clicks (10 sales x $50 each).
Why Track Conversion Value?
- It shows you the direct money made from your PPC efforts.
- It helps you see which keywords are bringing in more valuable sales.
- It points out where you can adjust your spending to make more profit.
Conversion Value per Cost (CVC)
CVC is about how much money you make for every dollar you spend on ads. Here’s the math:
CVC = Conversion Value / Cost of Clicks
So, if your ads cost $100 and you made $200 in sales, your CVC is $2 for every $1 spent ($200 in sales / $100 spent on ads).
Why CVC Matters
- It helps you get the most out of your ad budget.
- It’s good for comparing how different campaigns are doing.
- It lets you put your money into the keywords or ads that make you the most.
Keep an eye on conversion value and CVC when you’re running PPC ads. Find out which keywords bring in the most money and focus on those to boost your ad spend efficiency.
Advanced PPC Metrics for In-depth Analysis
Let’s dig a bit deeper and look at some more detailed metrics that can really help you understand how your ads are doing. Here are a few more numbers and terms worth keeping an eye on:
Search Lost IS (Budget)
This tells you how often you’re missing out on showing your ad because you don’t have enough money in your budget. If this number is high, it might be time to think about spending a bit more to reach more people.
Search Lost IS (Rank)
This metric lets you know how often your ads aren’t showing up because they’re not ranking high enough. To get better, try improving things like your click-through rate and Quality Score.
Outranking Share
Outranking Share is all about seeing how often your ads show up higher than your competitors’. Keeping track of this can help you understand if you’re beating the competition.
Absolute Top Impression Share
This one shows you how often your ads are the very first thing people see. Being at the very top means your ad is super relevant.
Click Share
Click Share gives you an idea of how many clicks on keywords are going to your ads. It’s a good way to check if your ads are hitting the mark with what people are searching for.
Benchmark CPA
Benchmark CPA tells you what other advertisers are paying, on average, for a conversion in your field. Comparing your numbers to this can show you if there’s room to make your ads more cost-effective.
ROMI (Return on Marketing Investment)
ROMI compares the money you make from your ads to how much you’re spending on them. You want this number to be over 3, showing you’re getting a good return on what you spend.
Keeping an eye on these more detailed metrics, along with the basic ones, will give you a fuller picture of how your ads are performing. This can point you in the right direction for making your ads even better.
Conclusion
Keeping an eye on important PPC metrics is a must if you want to know how well your ads are doing and find ways to make them better. By watching numbers like how many people see your ads, how many click on them, your click-through rate, how many of those clicks lead to something valuable like a sale, how much it costs you to get a new customer, and how much money you’re making compared to what you’re spending, you can spot what’s working and what’s not.
Here’s a simple way to look at your PPC metrics:
- Set clear targets for each important number based on what you want to achieve, what’s normal for your type of business, and how you’ve done in the past. This helps you know what you’re shooting for.
- Break down your data by things like which keywords or ads are bringing in clicks, or which landing pages are doing well. This helps you see the strong points and the weak spots.
- Fix what’s not doing great by trying different ads, changing how much you’re willing to pay for clicks, making your landing pages better, and getting more specific with who sees your ads.
- Invest more in what’s working by putting more of your budget into the ads and keywords that are bringing in good results.
- Keep testing and tweaking – Getting the best out of your PPC ads means always looking for ways to do better as things change over time.
By keeping a regular check on your PPC metrics and using what you learn to make smart choices, you can get more value from the money you spend on ads and get closer to your marketing goals. Remember, it’s all about making small improvements over time.
