Get To The Heart Of Your AdWords Performance

Dec 22nd 2016

Get To The Heart Of Your AdWords Performance

As the year winds to a close, it’s a time to take a look back at the last year: Cataloging goals achieved and missed is a great way to measure your personal growth and prioritize what you want to work on in the upcoming year – and this applies to your marketing just as much as your personal goals.

As you look back at your AdWords campaigns for 2016, there can be a tendency to ‘miss the forest for the trees; there are simply too many metrics and variables to get a clear view of what worked, what didn’t, and where to take your strategy in the new year.

To make the smart decisions you need in 2017, here are 3 metrics that will give you a clear view of your account performance:

Quality Score

Why It Matters

Quality Score is Google’s nod towards search quality – it is the hidden multiplier that makes sure that if spammers want to pay for irrelevant keywords, they at least will have to pay out the nose for them.

At a very basic level, Google’s ranking algorithm for AdWords is Bid X Quality Score – A better quality score means you will have to bid less to appear on the search page for a given term.

How To Improve

There have been oceans of digital ink spilled over the question of improving quality score – but at the simplest level, it is an easy question to answer. Take a look at your landing pages and ensure that they are closely relevant to the terms you want to advertise for. If they aren’t, consider building out additional pages, or refresh your content to match the terms that are actually being searched.

Conversion Rate

Why It Matters

This is a step away from the metrics that AdWords provides – You will need to pull data from both AdWords and Analytics to get a detailed look at your conversion rate for any given AdWords campaign. But knowing how many of your clicks are turning into conversions will help you judge the effectiveness of your campaigns.

The formula is simple – The percentage of clicks that led to a conversion action. This action be be a sale, a newsletter signup, a ‘learn more’ request. I have found that is if often helpful to look at these by page in Google Analytics first. See which pages are doing well, then segment the traffic to see how AdWords traffic compares to the rest.

How To Improve

To improve your conversion rate, you will need to take a look at the landing pages that you are directing traffic to, and ask the following questions:

  • Do they match the ad text? Will the people who click your ads see what they expect to see, or does the page text vary from the ad text?
  • Is your Call-To-Action clear and reasonable? To count as a conversion, a user will have to do something. Is that action clear? Is it something small that they are likely to do?
  • Is the landing page designed well? Everyone hates landing on an ugly page, or one that doesn’t render on a mobile device. Landing page builders like Unbounce are great tools for creating and testing clean landing page designs.

Cost Per Conversion

Why It Matters

Cost-Per-Conversion is the AdWords metric that should track most closely with the real world impact of digital advertising for your business. This is basically a count of all the users from AdWords who completed your coal action (Conversion), divided by total spend. This lets you know how much each conversion cost you.

You should start by looking at your Cost Per Conversion at an account-wide level, and ask the following questions:

  • Is this sustainable? Can you bring in leads at this expense and still turn a profit?
  • Is this competitive? Is this Cost Per Conversion high or low compared to your other forms of marketing?
  • Is this scalable? If you could bring in 10x as many leads at this price, would it still be worthwhile?

Next, you will want to look at different campaigns and ad groups – are any of these netting you a lower Cost Per Conversion than the average, and are the leads generated by these campaigns of an equal value? These are a good place tos start if you want to shift your budget around.

Note: Cost-Per-Conversion is the first step on the road towards calculating the Gold Standard of marketing metrics – Cost-Per-Acquisition. By calculating how much it costs to generate a closed sale in any of your marketing channels, and figuring out how much revenue you can expect to generate, you can start making some really smart marketing decisions. Learn more about CPA and other smart metrics in our free ebook!

How To Improve

Cost-Per-Conversion is a downstream metric that can be influenced by dozens of small decisions in your strategy. Once you have fully optimized your account and are pleased with your targeting, you should take a look at your landing pages and calls-to-action and start testing ways to turn more of your clicks into conversions.

We hope these three metrics will help you guide your decisions in the upcoming year! For more about AdWords Metrics that really matter, and creating goals that drive business performance, download our free guide!

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