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What Is the Most Important Metric in Google Ads Campaigns?

July 13, 2020

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Google Analytics will give you hundreds of metrics in your reports. Personalising it to your own needs and making sense of the data it retrieves takes skill and time to master.

But, with so much information available, how can you tell what you should focus on right now and what to leave for later?

We will list some of the most relevant and commonly pursued key metrics, and describe their utility for a marketer or a business owner who gets their data from the AdWords account. Because each company has certain specific needs, and because the needs are different as the campaigns change, we can’t only focus on one metric.

Impressions

Quite often, the first metric the user looks into is the number of impressions. An impression means that your ad was shown on the Google Ads network. To be more precise, it’s actually the number of times the ad was shown on the network, as nothing can guarantee that the user had actually seen it.

The number of impressions is not a spectacular metric, but it is relevant to other analysis. For example, another interesting metric is the Search Impression Share. It is calculated based on the number of impressions you received and the number of impressions you’re eligible to receive based on your relevance. It’s a metric that shows how you rank in Google’s quality evaluation algorithm.

Cost

If you are working on a tight budget, then it’s crucial to know where and how every marketing penny is spent. Google Ads lets you track the cost you have had so far. You can filter the costs by ad groups, campaigns, and keyword blocks, and use this information for your future strategies.

Click-Through Rate (CTR)

One of the most important metrics in Google Ads is the CTR – the click-through rate. It tells you exactly how many people have actually clicked on your ads and got to your website. It is calculated as a ratio between the number of clicks and the number of impressions. Of course, this doesn’t automatically translate into successfully making sales, but it gives you a good idea about the attractiveness of your ads.

If you notice ad variants with lower CTR, you can optimise the ad copy or other elements that seem to work poorly. CTR is a crucial metric to monitor during A/B testing, for example.

Conversion Rate (CR)

Whether you have launched an ad for bringing more sales, or for getting new subscribers, when a visitor clicks your ad and proceeds to complete your goal, it will be counted in your conversion rate. This is the ultimate goal for any campaign ad groups and a good measurement of how your marketing strategy is working.

The CR is calculated as a ratio between the number of conversions and the number of visitors on your website. Moreso, Google Ads can even track how many phone calls your business gets after a Google Ads campaign.

Average CPC (Cost per Conversion)

Besides getting a high conversion rate, you should aim at keeping your marketing budget reasonable, as your profit margin is actually affected by both variables. The cost per conversion metric is just as important as CR and the overall cost.

High costs will lead to a lower profit if the revenue per conversion does not cover the CPC. The CPC is calculated as a ratio between the cost per conversion, the total number of conversions, and the total actions.

Quality Score

The quality score of your ads is a complex score given by Google to the ads that end up in its network. It does this in order to prioritise high-quality content for the visitors, and it uses a complicated algorithm to determine which ads have value and which ones are less relevant.

In order to score a high-Quality Score, your ads have to lead to a relevant web page from a trusted website. Your ads will be evaluated based on keyword relevance, user experience, URL and landing page relevance. A high-quality score indicates that your content is relevant to the search query that led to it.

Cost per Click (CPC)

This metric is quite self-explanatory: it’s represented by how much you actually pay per click. The number of clicks will almost always be higher than the number of conversions, it is to be expected. For this reason, the CPC should be calculated in your overall campaign budget and not exceed a certain amount. Otherwise, you won’t get any profit. You will just send irrelevant ads to people who are not willing to make the purchase or fill in your form.

Over to You

These are the metrics that users look into most commonly. They should be known and monitored by any business, as they are very good indicators of how well your Google Ads are performing.

While being familiar with other search engines and advertising networks is part of being a knowledgeable marketer, Google Ads still remains the most important shareholder in the world of online advertising. It’s also a trend-setter.

If you are not yet familiar with how to juggle with these metrics and what to read from them, don’t hesitate to hire an advertiser who can shed light on how Google Ads data works.

We at Australian Internet Advertising have many years of experience with Google Ads and have developed a friendly way of reporting and interpreting the data to our client’s advantage. You don’t have to know any of these metrics, but we would be happy to discuss on a deeper level how to optimise your ads for the best results for your business. We are a trusted Google Ads Agency with strategies that generate amazing results!

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