Three Must-Measure Google Metrics for a Successful eCommerce PPC Campaign
by Ron Dod
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Investing in pay-per-click (PPC) advertising is an essential element for eCommerce merchants who seek to bolster their online activity and reputation. Not only do these campaigns give retailers an instant boost in visibility and revenue, but PPC adverts can also assist SEO efforts.
However, to effectively optimize and measure the objective successes of a campaign, retailers must understand which metrics and KPIs to monitor. Given that just about everyone online has an opinion on this matter, the waters can often be murky, causing significant confusion.
It is vital for those running a PPC campaign to understand the correct Google metrics to utilize from the start as each campaign goal correlates to a specific set of KPIs. Knowing a campaign’s purpose and how to measure the outcomes effectively will enable merchants to set up their Google Ads and Google Analytics accounts properly prior to launch. Accurately measuring performance from the beginning is essential for maintaining the campaign’s integrity.
However, before diving into Google metrics, it is essential to ensure the systems for proper measurement are first established.
Google Ads + Google Analytics
Many merchants purely utilize the Ads platform when analyzing Google metrics for their PPC campaigns. However, by linking Google Ads with the Analytics platform, merchants can gain a far more comprehensive understanding of their efforts and performance.
Each of these tools has their core strengths and insights to provide, but by pairing the two together, a much more useful depiction can emerge. Pairing the services provides a more complete picture of user behaviors as each only tells part of the story.
While Google Ads supplies information on PPC ad spend and performance metrics such as which keywords generate the most conversions, the platform fails to educate users on what actions were taken on a website after generating a click-through. At this point, retailers must rely on Google Analytics to fill in the blanks.
Moreover, by linking Google’s two platforms to enhance eCommerce analytics information, merchants gain access to additional data for optimizing campaigns.
In the Google Ads reports section of Analytics, retailers can view (once connected) data on bounce rates, average visit duration, pages per visit and more. These data points help eCommerce sellers to understand if their Ads campaigns are driving quality traffic to their sites or not. Additionally, this section also details performance metrics such as average cost-per-click and click-through rates (CTR).
By having these platforms integrated with each other, merchants can gain a better understanding of how much ad campaigns are costing and how much revenue they are generating.
Naturally, revenue is the most important metric for eCommerce PPC campaigns to monitor and measure. A campaign’s revenue will largely determine the campaign’s success as sales can inform a brand on how enticing and on-target their copy, offer, landing pages and other PPC elements were for the audience reached.
However, while it is good for a retailer to understand the total sales revenue generated from a campaign, there are a variety of metrics contained under this umbrella that merchants will also want to analyze. These include:
Conversion rate: Expressed as a percentage, conversion rates inform merchants what portion of their audience is completing purchases. This figure is calculated by dividing the total number of visitors by the number of conversions.
Sales: This metric can be broken down by purchases made by the hour, day, week, month, campaign, quarter or year.
Average order size: This metric informs how much shoppers typically spend per order.
Gross profit: The gross profit is found by subtracting the total cost of merchandise sold from the total sales.
Return on ad spend (ROAS): ROAS is calculated by subtracting the PPC cost from PPC revenue, dividing that by PPC cost and multiplying the result by 100.
It is essential to analyze all these Google metrics as doing so will help retailers to understand the overall performance of their campaign. Moreover, pouring over these data points will also assist merchants in formulating strategies for optimizing their PPC campaigns going forward.
For merchants running various PPC ads, there is an end goal in mind – for most, it will be sales.
In Google Ads, the company enables users to set goals for their ad campaigns. By doing this, retailers will “see relevant, recommended features and settings to help you attain the results that matter most to your business.” Conversion goals occur when “someone clicks on your ad and takes an action on your website that you think is valuable, whether it’s a purchase, a newsletter sign-up, or a request to receive more information about your organization.”
Therefore, once a site visitor completes the goal for a given campaign, it is called a conversion. Measuring a campaign’s conversion rate is essential as this helps retailers to gather information on which campaign elements are effective in driving the intended results. Moreover, by analyzing these eCommerce analytics, merchants can more effectively optimize their cost per conversion (CPC).
Advertisers can measure their campaign’s conversion rate by dividing the total number of conversions the campaign generates by the total number of clicks. Given that this figure is expressed as a percentage, the quotient will then be multiplied by 100.
For instance, if a campaign generates 500 clicks and 50 conversions, the formula would appear as follows:
50 ÷ 500 = 0.1 /0.1 x 100 = 10
Following this formula, retailers can determine that the conversion rate for the campaign is 10 percent.
However, there are a variety of strategies that eCommerce retailers can employ to increase their conversion rates, such as analyzing keyword data to establish if the right keywords and terms are targeted, assessing CTRs to determine if the ad’s copy, images or offer requires alterations, ensure landing pages are optimized for conversion generation and similar techniques.
Much as goal conversions help to determine campaign performance and ad effectiveness, an ad set’s CTR is also indicative of achievement, though to a lesser degree than the previous Google metrics.
While it is essential for eCommerce retailers to know how to measure a campaign’s click-through rate, it is important to remember that the average CTR varies greatly between industries. For instance, dating sites tend to generate a CTR of over six percent on Google’s Display Network. Meanwhile, eCommerce sites averaged less than three percent through the same network.
Merchants can find a campaign’s click-through rate by dividing the total number of clicks generated in a given period by the total number of impressions for that same timeframe.
If a retailer notices that their CTR is well below the industry average, try to optimize the ad set by analyzing and altering keywords and match types, creating urgency in the ad’s copy, utilizing ad extensions to increase visibility and click-ability, testing various CTAs and offers and similar strategies.
While merchants should start their optimization efforts at the click-through level, it is important not to get caught in a single Google metric or KPI as the ones described here (in addition to others) are inextricably linked. This means that by improving one, you are likely to enhance others.
Nonetheless, conducting the research for, effectively running, analyzing and optimizing eCommerce PPC campaigns can be a tricky and time-consuming endeavor. If merchants feel out of their depth in attempting to launch a successful campaign, rather than wasting their ad budget, it is wise to seek out eCommerce PPC management experts who can effectively put together a campaign that ultimately increases a store’s bottom line.
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Ronald Dod is the Chief Marketing Officer and Co-founder of Visiture, an end-to-end eCommerce marketing agency focused on helping online merchants acquire more customers through the use of search engines, social media platforms, marketplaces, and their online storefronts. His passion is helping leading brands use data to make more effective decisions in order to drive new traffic and conversions.
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