Google Ads Metrics: Understanding the Importance

The success of a marketing campaign is measured through ad metrics, serving as a key indicator of how well the campaign is doing in relation to key performance indicators (KPIs).

These metrics are pivotal for evaluating the effectiveness of strategies, offering a comprehensive overview of your marketing plan’s performance.

In this blog, we take a look at some of the key metrics to be aware of, what they mean, and why they’re important.

Interaction Metrics

When assessing the effectiveness of your campaigns, it’s essential to consider KPIs around ad interactions – such as impressions, clicks, and click-through rate (CTR).

By optimising your campaigns with the use of this data, you can ensure that you are getting the most out of them. It’s also important to combine these three indicators when measuring your efforts, to ensure you can identify any trends!

Impressions

An impression is recorded every time your advertisement is shown on a Google network, including display, search, Performance Max, and YouTube.

Impressions are a useful tool for measuring the volume of people seeing your ad.

Clicks

A click is counted when a user engages with your ad. Monitoring clicks offers insights into ad placement and budget adequacy, indicating campaign effectiveness.

Clicks are a good indication that your campaigns are working. Increased clicks naturally improves your quality score, potentially boosting ad placement whilst lowering cost-per-click (CPC).

Click-through Rate

Click-through rate (CTR) measures the frequency with which users click on your advertisement after seeing it, which can provide you with insight into the ad’s efficiency.

Conversion Metrics

Conversions, conversion rate and conversion value are three crucial metrics to track in order to determine the actual performance of your campaigns.

Conversions and conversion rate will reveal the genuine impact of your strategy, and conversion value will help you calculate your return on investment.

You can then use this information to make informed judgements about future investment opportunities.

Conversions

A conversion is when a user performs a specific action on your website such as filling in a form or making a purchase. But, depending on the objectives of your business, a conversion can be defined as many different things.

If your primary goal is to generate leads, you may set up a conversion as an inquiry, or if you run a store, you can set up the conversion action as a purchase.

Conversions demonstrate that consumers are performing the desired action you want them to, which makes them a reliable indicator of success.

Conversion Value

Following closely behind is conversion value, which can help you determine how much revenue you have generated from your campaigns.

Conversion value will help you track and optimise your campaign’s return on investment (ROI), and you can even use target ROAS (return on ad spend) bidding strategies to help maximise your conversion value (sales revenue).

Conversion value is essentially the figure you have assigned to a conversion. Typically used for e-commerce businesses, the conversion value will be attributed from the merchant centre as it’s the price of the product.

Bidding Strategies

Google Ads offers several different bidding strategies that are tailored to different campaign objectives. Your bid strategy will be determined by which network your campaign is targeting.

The most common objective for a campaign is to receive conversions (purchases or leads), however, some campaigns may be set up to receive clicks or impressions.

Google now uses a range of automated bidding strategies which essentially learn as they go using information about a bid’s performance to inform future bids. 

Here are some examples of bidding strategies, and what they mean…

Maximise Clicks

Maximise clicks sets your bids to get as many clicks as possible within your daily budget – this bidding strategy is the best if you are trying to increase site visits.

Target Impression Share

Another bidding strategy is target impression share. Target impression share sets bids with the goal of showing your ad on the top of the page – this bidding strategy works best when you are looking to increase visibility.

Target CPA

Target CPA bidding works well when you are working towards a cost per acquisition (CPA), as it sets bids to help you obtain as many conversions as possible in relation to the CPA you specify.

Target ROAS

Target ROAS helps set bids to get as much conversion value as possible at the target return on ad spend (ROAS) you set. This bidding strategy is recommended if you are looking to reach a specific return on investment.

Maximise Conversions

This is one of the most popular bidding strategies as the bidding will help you optimise towards conversions.

It will emphasise the area that you want to maximise while keeping your budget into consideration.

Maximise Conversion Value

Lastly, we have maximise conversion value. Maximise conversion value works in a similar way to maximise conversions however you will add a target ROAS.

This bidding strategy will aim to spend your budget to maximise conversion value for your campaigns.

Budgeting

When it comes down to choosing your budget, lots of factors will come into play. Most companies will have a set budget that has been allocated for the month.

The campaign objective and keywords will determine how you split the daily budget out as there may be certain areas you want to focus on. 

This will also vary per industry as some industries typically have a higher CPC meaning you will need some extra budget to cover all bases.

Conclusion

In conclusion, each and every ad metric is important for ensuring the effectiveness of your ads. Understanding ad metrics and how they affect your data is crucial to the success of your campaigns.

There are many more ad metrics that you can consider based on the objectives and purpose of your campaign, but the ones that are mentioned above are some of the most popular. 

Want to learn more about how ad metrics impact your campaigns’ success? Contact a member of the team to book a free PPC audit today.