Computers and Technology

PPC Guide: Key Metrics to Measure your Campaign’s Performance


August 17, 2019 12:14 PM

In the world of digital advertising and marketing, PPC (pay-per-click) ads marketing has attained a great significance. Understanding the growth of this major aspect will let you know about immense opportunities that can drive higher conversions. But the question is – how you can measure these outcomes, and what metrics should be used?

While running your PPC campaign, it is necessary to monitor its performance consistently. Marketers will require to track every activity that can impact their campaigns. However, there are a certain number of metrics that can help to measure these aspects.

Here are they:

  • Click-through Rate (CTR)

It is quite similar to that of measuring the number of clicks on your PPC ads. When you need to check the performance of your campaigns, you can measure CTR. It is determined by calculating total clicks and dividing it by total impressions they got during a specific period of time. For instance, if your ad got 600 impressions on 60 clicks in a daythen CTR will be 10%.

However, you can’t be specific about CTR as the performance will always vary according to the trends. But always keep the measurements in mind to monitor the performance. Just make sure that results don’t vary much as might affect your campaigns.

  • Cost per click (CPC)

PPC advertising needs a predetermined budget to invest in the ad campaigns. So, marketers should know how much they are paying for their ads. During the setup of these campaigns, advertisers mark their budget and bid. But they shouldn’t compare their investments with the amount they will pay through the clicks on ads.

It is generally measured as total cost invested in a campaign divided by the number of times the ad clicked. However, the cost of setting up an ad is generally marked up during the PPC auctions when other competitors make bids.

  • Quality Score

Another important metrics is a quality score. Google has given it great importance and usually prefer to accept content with a high quality score. Using CTR and other performance keys, you can measure the quality score of your PPC ads.

It might be a little complex to determine this metric as compared to other key indicators like ad relevancy, clicks, landing page response, etc. However, if the overall performance of your campaigns is good then Google will not hesitate to prefer a good quality score for your ads.

Here are the criteria on which your ads will be scored:

  1. Quality Score between 7 & 10means you don’t need more expenses to advertise with Google Ads.
  2. Quality Score from 6 to lower ratings means you might spend more on your ads.

In recent updates from Google, advertisers got some leverage to identify the quality score of their ad campaigns. In that case, they have a much better idea to calculate the overall performance and make their ads productive.

  • Conversion Rate (CVR)

PCC marketers can also measure their success, and this can be done by determining the conversion rate. It is calculated by dividing the total conversions come through ads by the total number of clicks.

It is generally determined in percentage, for instance, if you got 10 conversions on 100 clicks then the conversion rate is 10%. You can always set focus on conversions rather than clicks, but you still need to optimize campaigns based on clicks.

While you might have goals based on conversions, you should also keep an eye on CPA (cost per acquisition), which is another performance metrics.

  • Cost Per Acquisition (CPA)

CPA is defined quite similar to CPC, and it can be set when advertisers configure their PPC campaigns. It is generally calculated through the total amount spent on conversions divided by the number of conversions. For Google, the average CPA is the total costs paid by the advertiser whenever a new customer is attained.

However, this metric totally depends on your quality score. While setting up the campaigns, you can also set the CPA goals that can further help in bidding. This will make sure that less cost is spent during the conversions or clicks.

As a result, the campaigns will get you conversions as much as you can expect, based on your predetermined CPA goals.

  • Average Position

Since Google operates every search based on users’ requirements and organic search as well, so the ads will get show up on the top but have different positions. These positions are generally set on the basis of ad relevancy, quality score, and traffic as well.

In that case, Google determines the rank of an ad and hence gives random positions to them. It doesn’t matter who is the highest bidder, the placement is done on the basis of all the necessary performance metrics.

Moreover, it is not always necessary that ads on the first two positions will have a higher chance of conversions. So, you need to focus on the average position on which your ad is performing and gaining conversion opportunities.

Running PPC campaigns needs a lot of focus on every major aspect, and these performance metrics will help you to keep everything under control. A good PPC management company will always make sure to determine their outcomes and optimize the campaigns periodically. Sticking with the goals will always help you to choose the right path towards success.