How To Measure PPC Campaign Success

Paid advertising benefits your business in multiple ways. It increases your visibility in the overcrowded SERPs and gives you the opportunity to put yourself in front of people that are really interested in your offers. Wordstream claims that 41% of clicks go to the top 3 paid ads in the search results page, while 65% of people with a high commercial intent click on a paid ad. Moreover, according to Unbounce, PPC visitors are 50% more likely to buy from you than organic ones. Given these stats, it’s not surprising that paid advertising drives a high ROI. Namely, for every $1 you invest in Google Ads, you will make $2.

However, creating a successful Google Ads campaign is not easy. You need to constantly track its performance and A/B test everything in order to make informed PPC decisions and stop wasting money on unprofitable practices. When measuring the success of your PPC campaign, you need to understand your industry benchmarks, set clear campaign objectives, and tie your PPC metrics to them.

Here are key PPC metrics that will serve as your solid starting point.

The Click-Through Rate

Clicks and click-through rates are not the same. While clicks only tell you how many people opened your ad, the click-through rate provides a far wider context. Namely, this KPI tells you how many users clicked on your ad, compared to the number of people who saw it. To measure CTR, you need to divide the total number of clicks by total ad impressions (views).

According to the 2018 WordStream report, the average CTR is 3.17%. Still, this figure varies across industries. For example, the dating and personals industry has the highest CTR (6.05%), while the CTR in the technology sector is only 2.09%.

Conversion Rate

Conversions are the nerve center of your PPC success and the main purpose of your campaign. Namely, your goal is not only to attract people to click on your ad, but also engage them and inspire them to take the desired action (download an eBook, submit a form, make a purchase, etc.).

To measure your conversions successfully, you need to track your conversion rate. This metric stands for the number of conversions you generate as a result of your PPC campaign.

To understand where you stand compared to your competitors, you should track industry benchmarks, as well. According to the abovementioned Wordstream report, the conversion rate varies and the average one is 3.75%. The highest CVR belongs to the dating and personals sector (9.64%), while advocacy businesses have a CVR of only 1.96%.

The conversion rate is important for a simple reason – it indicates the success of your entire campaign. Creating a creative ad copy that grabs people’s attention and gets them to click is just half the job done. The other half is meeting their expectations once they land on your page. Poor conversion rates may indicate problems with your content relevancy or the design and functionality of your landing page (its visual appeal, navigation, CTA buttons, page load speed, and so forth). These are serious UX issues that may hurt both your organic and paid conversions. This is where you should consult professionals such as OMG digital marketing company to help you improve your overall online presence and provide consistent experiences in the SERPs and on your website.

The Quality Score

The quality score is a bit elusive metric created by Google. Its main goal is to determine the quality and relevancy of your ads and their content. The quality score is based on multiple Google Ads metrics. For example, Google calculates your account history, average CTR, the relevance of keywords and your content to the search query, as well as the user-friendliness and relevance of your landing pages.

The quality score is calculated on a 0-10 score. Logically, 5 is the golden mean, while the optimal score is above 7. So, if your score is lower than that, you need to focus on making your ads more relevant for the keywords you’re targeting and invest in the overall optimization of your landing page.

Now, staying on top of this KPI was extremely difficult a while ago. Precisely because of that, Google now allows PPC managers to see their historical quality score in Google Ads. This has helped PPC managers understand the idea behind this metric and track their campaign success more efficiently.

Cost Per Acquisition

Cost per acquisition (CPA) lets you understand whether your PPC strategy is designed for profit. Namely, this KPI informs you about the costs of your PPC campaign, compared to the number of conversions you gained through your ad. In other words, it tells you how much it costs to acquire a single customer via your PPC campaign.

Unsurprisingly, cost per acquisition is measured by dividing the total cost of your conversions by the total number of conversions. Also, don’t forget to compare your CPA to your industry benchmarks. For example, the average cost per action is about $48.96, while the highest one is in the technology industry ($133.52).

Return on Advertising Spend

Return on advertising spend (ROAS) can tell you what the ROI on your PPC campaign is by measuring how much you earned for each dollar you spent. It’s calculated by dividing the gross revenue you earned as a result of a campaign by your initial investments.

For instance, if you allocated $1000 on your Google Ads campaign and gained $6000 in gross revenue. This would mean that you earned $6 dollars for every $1 you spent on your campaign. Measuring this metric regularly can help you see whether your campaign paid off and let you strategize and budget your future campaigns wiser.

Over to You

The Definitive Guide to Measuring Marketing Performance by Paul W. Farris highlights that most marketers don’t appreciate "the range of metrics by which they can evaluate marketing strategies and dynamics." Unfortunately, that’s true. Don’t take your PPC efforts for granted. Just because a PPC campaign cost you a pretty penny doesn’t mean it’ll dive the desired ROI.

Most importantly, don’t wait until its end to start measuring its effectiveness. Measure your performance consistently, from the very launch of your campaign. Also, don’t forget to compare your reports to the average industry benchmarks to see where you stand, compared to your major rivals. This is the only way to maximize the effectiveness of your PPC tactics and stop wasting money on those practices that don’t work for you.

How do you measure the success of your PPC campaigns?

Elaine Bennett is a digital marketing specialist and a regular contributor for Bizzmark Blog. She writes hands-on articles about business and marketing, as it allows her to reach more people and help them on their business journey.