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The Great Performance Shuffle – Part 2

by | Jun 28, 2012 | Search Engine Marketing

How to tell if your Adwords campaign is working?

Your performance will only be as good as your ability to measure and track your results. You know the saying, “You can’t manage what you don’t measure.” But what do you measure in Adwords? What are the important key performance indicators and how do you measure SEM performance?

Adwords has a lot of bells and whistles but we’ll focus on 5 core metrics and why they’re critically important to the success of your Adwords campaign.

Here are 5 metrics you should be focused on to get the most out of your Adwords campaign.

  • Conversions – This is the one we don’t have to tell you about as every business owner and marketer is obsessed with conversions, but the secret to this number is to understand how much a conversion means to your business in dollars. Especially if a conversion from your Adwords campaign is not a direct sale. Make sure you track how many of the Adwords conversions turn into sales and you will be able to calculate the value of each Adwords conversion.
  • Quality Score – The quality score is a somewhat mysterious but critical metric in the health of your Adwords campaign. It measures how relevant your keywords, ads and landing pages are to someone viewing you’re ad on a scale of 1 to 10, 10 being the best. A high quality score means Google thinks your ad is very relevant and your ad is likely to be shown more and cost less. If you have a lower quality score, you will be pay more for your keywords and it’s possible your ads will not show up at all. Although, Google has released information on how the quality score is calculated, the “relevancy” part of the equation is based on the perspective of Google. As an advertiser make sure that there is continuity between the keywords, ads, and landing pages, and don’t try to redirect traffic or trick Google’s system.
  • CTR – The Click-through-rate is important because it’s the main indication of relevancy of your ad and it is part of the quality score formula. If you can’t tell by now, Google’s goal is to serve up the most relevant ad for every search and Google sees every click as a positive vote by a user. If you want to be elected for more ad views and a lower cost, improve your CTR.
  • Impression Share – The impression shareis the percentage of ad views you received compared to how many ad views are possible. Impression share is important because it lets you know the percentage of ad views compared to your competition. If you are only getting 20% impression share that means 80% of the time your competition is showing up and your ads are not. There are two ways to increase your impression share, increase your budget or improve your quality score. Again, Google will show the ads believed to be the most relevant.
  • ROAS – Return on Ad Spend is not a metric that you will find in Adwords, but it is one you should be calculating. ROAS is simply the amount of revenue generated divided by the amount spent. This will give you a basic understanding of whether your marketing is profitable or not. Depending on your business it may not tell the full story as some businesses make the majority of their profit on the back -end, so to really get an understanding of if your marketing is profitable you need to track everything through to the final sale.

There are a ton of other metrics in your Adwords campaign and reports to monitor them all. However, most of Google’s metrics are monitoring the relevancy of your campaign. The best way to improve your metrics will be to increase the relevancy of your campaign overall.

There are some very specific strategies to improve these metrics and if you need help, building or improving your Adwords campaign, contact us today or give us a call at 866-925-9524.


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