PPC (Pay-Per-Click) can be a bit of a confusing topic.
There are just so many numbers and variables to choose from.
While you may feel that only Rain Man could decipher the PPC numbers and statistics, we’re here to tell you different.
We’ve got a list of the top KPIs to look out for when you run your PPC campaigns.
As PPC experts who have run multiple successful campaigns for our clients, these are the top 5 we think you should focus on.
The 5 Top PPC KPIs You Need to Look Out For
The specific KPIs you focus on may depend on your campaign goals and business objectives.
1. Click-Through Rate (CTR)
CTR measures the percentage of people who click on an ad after seeing it, relative to the total number of impressions (views) the ad receives.
In other words, CTR is the ratio of clicks to impressions, expressed as a percentage.
A high CTR generally indicates that the ad is relevant and appealing to your target audience.
It suggests that the ad copy, keywords, and targeting are aligned with user intent.
It can also mean that a larger proportion of people who see the ad are clicking on it. This implies that the campaign is more efficient and effective in driving user engagement.
Ads with lower CTRs may need adjustments to improve their relevance and appeal.
You’ll need to monitor your CTR over time to provide detailed insights into your campaign performance.
You can identify trends, make data-driven decisions, and optimise campaigns to improve results.
So don’t just pull the plug if your CTR is lower than a limbo stick.
Give it time and see how it performs over a sustained period.
It’s important to remember that while CTR is important you can’t pin your campaign’s success on this one KPI.
2. Conversion Rate
Conversion rate is the percentage of users who take a desired action (a conversion) after clicking on an ad or visiting a landing page.
Conversions can include various actions, such as:
- Making a purchase.
- Filling out a form.
- Signing up for a newsletter.
- Any other goal that aligns with the campaign’s objectives.
In layman’s terms, it represents the proportion of clicks that result in the desired outcome.
It provides insights into the campaign’s ability to generate desired outcomes.
Conversion rates are important because they can affect the bottom line of your business.
Each conversion could be a sale that contributes to revenue.
That revenue can contribute to your company’s profit.
That profit is what contributes to your 3-week all-inclusive holiday to the Bahamas…
You get the picture.
Low conversion rates may indicate issues with the user experience on the landing page or problems with the conversion process.
You should use this information to improve the user journey and increase the likelihood of conversions.
3. Cost Per Click (CPC)
CPC represents the average cost that you pay each time a user clicks on your ad.
You need to know how much you’re paying for each click to allocate your budget efficiently and ensure you’re getting the desired number of clicks within your budget.
Monitoring CPC helps you control your costs and set appropriate bids for keywords.
Understanding the cost associated with each click allows for adjustments to bidding strategies, ensuring you don’t burn through your budget like an Australian bushfire.
By knowing the cost of each click, you can assess the cost-effectiveness of your campaigns and evaluate the return on investment.
This information is essential for determining whether the campaign is generating value relative to the amount spent.
A campaign with a high CPC will end up being expensive to run.
That is why a low CPC is desirable.
But there is no point in having a low CPC if the clicks generated aren’t relevant and don’t contribute to the campaign’s objectives.
It’s a bit of a balancing act.
You want a low CPC as long as they’re relevant.
But if your CPC was higher with more relevant clicks then you could still keep the campaign running.
Providing you don’t blow that budget of course!
4. Cost Per Acquisition (CPA)
CPA represents the average cost you incur to acquire a new customer or lead through a specific conversion action.
In other words, CPA measures the cost efficiency of a PPC campaign by indicating the average expense associated with acquiring a customer or generating a desired conversion.
CPA directly ties advertising costs to the acquisition of your customers or leads.
By understanding the CPA, you can optimise your budget allocation to focus on campaigns, keywords, or ad groups that deliver the most cost-effective acquisitions.
This helps in maximising your return on investment (ROI).
5. Return on Ad Spend (ROAS)
ROAS measures the revenue generated from advertising relative to the amount spent on those advertisements.
It is expressed as a ratio and it quantifies the effectiveness of advertising campaigns by revealing how much revenue is generated for every pound spent on advertising.
ROAS directly ties advertising costs to revenue, providing a clear indication of the profitability of a PPC campaign.
You can assess whether your advertising efforts are generating enough revenue to justify the costs.
Comparing ROAS across various advertising efforts provides insights into which strategies are most effective in driving revenue.
Different businesses may have varying acceptable ROAS targets based on factors such as:
- Profit margins.
- Customer acquisition costs.
- Marketing strategies.
With ROAS you can assess not only how well your ads are driving clicks and conversions but also how effectively those interactions contribute to revenue generation.
Achieving a positive ROAS indicates that your advertising efforts are contributing to the bottom line.
It’s for this reason that ROAS is usually one of the top KPIs that spammy marketers on the internet like to dangle.
They say things like – ‘Work with us and we’ll 10x your ROAS in 1.5 days’.
While ROAS may seem like the sexy KPI that every business owner should focus on, it’s important to remember that it doesn’t paint the whole picture.
While it is an important KPI, don’t fall for the clickbait and take off your ROAS-tinted glasses.
Your PPC Experts – Blaze Media
There you have it.
5 KPIs that you should look out for when it comes to running Google Ads campaigns.
Google Ads can be quite overwhelming to the uninitiated…that’s why we like to put guides such as these together.
But if you want real results with your Google Ads you’ll need to employ the help of some experts who know what they’re doing.
That’s where we come in.
We’re a full-service digital marketing agency that runs Google Ads as a service for our clients that are based in a wide range of industries.
Our experience with many different campaigns has allowed us to adopt innovative strategies that we’ve seen get outstanding results.
Check out how we helped this fragrance company achieve a sales value of over £65k with PPC.
If you’re interested in getting started with Google Ads or want to boost your existing lacklustre results then please reach out to us today.
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