|PPC||– 13 min read|
Most Important PPC KPIs You Should Be Tracking: A Guide For Newbies
Remember the famous Google Job Experiment by Alec Brownstein? Alec spent $0.13 on an average per click and targeted five creative directors whom he wanted to work with. This senior copywriter was at his best ideating that these directors would also search up their names on Google, just like he did for himself. And when they do, they will end up seeing a job request from him.
That's why he bidded their names on Google Adwords, and four of them invited him for an interview, out of which two of them offered him a job. The ads that he placed were linked to his website and the entire campaign cost him a total of only $6. Isn't that awesome?
This is probably one of those examples where it wasn't about the traditional KPIs we measure because the most important metrics here were the number of offers Alec received from his campaign.
Imagine what would happen if brands did not measure the total number of clicks on their ads? Or what brought them traffic? In that case, they'd still be spending dollars blindly. More like floating away your penny by yourself into the drain!
Measuring PPC KPIs for better conversions
Measuring a KPI is about highlighting the key performing metrics that decide the fate of your campaign. The starting point for your PPC campaign is Google AdWords, the single most prominent PPC advertising system. Google AdWords allows you to create relevant ads that will show up on Google search engine and also on other Google properties.
To ensure more relevancy and quality, here are the top 5 KPIs that you should start measuring and tracking if you haven't yet.
#1: Clicks and Click-through rates as the key metrics in ppc
Clicks are the starting point for your campaign. Conversion begins with a click. Hence, this is the first indicator of how your PPC campaign is faring, especially if you are looking to check how it's performing in the mid-month. Usually, marketers keep an eye on how the campaign is performing regarding clicks. They may even pause campaigns that aren't performing as expected or increase the bid.
However, clicks alone cannot determine the success of your campaign. Similar to measuring clicks, is Click-through-rate. This is measured by
While CTR helps you to know how your campaign is performing, there is no set range or benchmark for this. It varies according to industries and various other factors. Thus there is no one-size-fits-all benchmark everyone should be striving to achieve. WordStream created an infographic where shared benchmarks for average CTR for 20 common industries.
#2: Quality Score
#2: Quality Score
After the recent change in Google's quality score reporting, it has become less daunting for advertisers to start measuring it. It has now started providing historical data about KPIs that has made the game much more smoother and smarter.
#3: CVR, CPA, and CPC KPI
- CPC - Cost per Click
- CPA - Cost per Acquisition (or conversion)
- CVR - Conversion rate
A PPC campaign begins with setting a fixed budget and a bid. Advertisers bid immediate highest amount of the bid price for the ad placement. If I have to tell in numbers, it is something like this:
Targeted CPA: a bidding technique that advertisers apply when creating the campaign. It helps to set bids that will automatically trigger conversions (As many possible based on the CPA budget). What you need to do this are:
- Understand various bidding techniques
- Setup conversion tracking
- Have around (minimum) 30 conversions in the last 30 days
(20/200) X 100 = 10%
Note: Conversions are great and mostly the sole aim of your PPC campaign. But marketers mostly set up campaigns to optimize the clicks rather than CVR.
Impression shares give marketers insight into their competitive status. If your impression share is 40%, it means your competitors own the remaining 60%. If you can increase the impression share for your ads, it automatically means that you are decreasing the chances of your competitors' ads being seen.
#5: Best ad position on search engines: SEM KPI
It is not like the highest bidder will always get the first ad position. It can either be on the top or in the second place. Average position gives marketers an insight into the position of their ads for the most of the time.
Some advertisers may have conversions with ads placed in the 4th position while some see a conversion in the second position. The average position is determined by the ad rank which is calculated as follows:
The average position can be better used to provide a better context for your ad and campaign reporting.
Advertisers should go back to improving all the KPIs rather than getting caught with just one. All the KPIs together paint the actual competitive status of your campaign. Ignoring or sidelining any one of them may hamper your cumulative result.
When you decide the KPIs you need to track, it should not be based on what someone else did or said or something you read. While all of these may help you pin down the best KPIs to track and measure, it should largely be based on your end goal, business proposition, and target audience.
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