Any successful PPC (pay-per-click) campaign will emphasise key performance indicators (KPIs). These are the metrics you’ll track throughout a campaign to measure performance.
Early on during the planning phase is when your goals should be matched to a specific KPI. There isn’t much point in running a digital campaign if it’s not being measured.
We’ve compiled a list of 7 important KPIs to help you work out what’s best for your brand and optimise your PPC ads accordingly.
A click is the first indication that you have an active audience. The amount of clicks does need to be measured and tracked alongside other metrics because clicks alone can’t determine exactly how a campaign has performed.
For example, an ad may have a lot of clicks, but you’ll want to know how many of these have led to conversions (a sale, subscription, call back etc).
Clicks are a way of showing that a campaign is active, or an ad is gaining attention – but they are not a way of showing how successful a campaign is in terms of ROI (return on investment). This brings us onto CTR.
Click Through Rate (CTR)
Understanding what CTR means and how you can track it will help you to determine your ad performance. It’s best to constantly work on CTR throughout a campaign by experimenting with things like keywords and ad copy.
Tracking click through rate means measuring how many clicks you receive on a PPC campaign, compared to how many times your ad was seen (impressions). This is a more accurate way of measuring audience engagement, as opposed to just clicks. CTR also helps to determine things like cost per click.
Cost Per Click (CPC)
It’s not always as simple as knowing your max budget for a PPC campaign. Your budget and bid that you set up at the start of a PPC campaign is not always the same amount that you will pay.
CPC is an important KPI because it measures exactly how much an advertiser is paying. It works by dividing the total cost of a campaign by the number of times it was clicked. Keeping on top of this will help you understand your ROI.
Conversion Rate (CVR)
PPC campaigns can have various goals and objectives – but they will usually boil down to sales or conversions.
Tracking conversion rate allows you to measure the performance of your site, app or web page. You can use Google Ads to calculate conversion rate. This works by dividing the number of conversions in one campaign by the total number of clicks. So, let’s say a campaign has 100 clicks and 10 conversions – then your conversion rate is 10 percent.
CVR is a way of understanding what percentage of users are completing the actions that drive your business. It’s a way of identifying areas for improvement and working out how you can achieve your goals through PPC.
You gain an impression each time our ad is visible to a user. It doesn’t matter whether somebody clicks or not – it will still count as an impression. This means that impressions are not a way of directly measuring the success of a campaign. However, this doesn’t mean that they are not important!
Impression share is a way of working out how well your ads are likely to perform compared to your competitors. We work out impression share by dividing the number of impressions achieved – by the total number of impressions that it was eligible for.
Your impression share determines whether your ad is meeting its potential (in terms of reach). Google say;
‘Eligible impressions are estimated using many factors, including targeting settings, approval statuses, and quality.“
Your impression share will give you a clue as to how well your competitors perform for a specific keyword. If your impression share for a term is 50 percent, you’ll know that your competitors own the remaining 50 percent.
Bounce rate or exit rate collects data on the percentage of users who visit your site and then leave without viewing another page. You can use this metric to determine why visitors are leaving your site. This helps to optimise things like content, CTA’s and landing page design.
Ideally, your bounce rate should be below 40%. A higher bounce rate is a good indication that you need to make change to your site.
Reporting on PPC KPIs
Improving performance based on one KPI is likely to have an indirect impact on another. For example, more clicks provide more opportunity for conversions. A better CTR is likely to improve quality score, which will lead to a better ROI etc.
With any digital marketing campaign – it might be tempting to aim high and start off with multiple KPI’s. Try to avoid overloading a campaign with too many KPIs and objectives. Instead, think about what is important in terms of a campaigns specific goals and outcomes.
Get in touch if you have any questions!