Understanding AdWords: The 4 Simple Metrics To Begin With

Understanding AdWords: The 4 Simple Metrics To Begin With

Need help understanding AdWords? These four metrics are easy to find in your AdWords reports and have some clear lessons to teach. 

Sure, the investment into Adwords can seem infinite, both in time and money, all in the hope of getting a better understanding of your performance. There are a distressing amount of dimensions and metrics to be broken down and analyzed. It can become a overwhelming but hang in there. There’s no need to dive right into the deep end of data when there is indeed a good place to start. 

These easy metrics will be enlightening, and help you find some opportunities for improvement. 

How Enticing Is Your Ad? Clickthrough Rate (CTR) Will Tell You!

This is one of the most important metrics in AdWords reports. Clickthrough Rate, or simply, CTR, is the percentage of people who see your ad and then click on it. Or, as Google puts it: CTR is the number of clicks that your ad receives divided by the number of times your ad is shown

If 100 people see your ad, but only 2 people click on your ad, then your CTR is 2%. This means that only 2 people, out of 100 found your ad copy compelling enough to explore further. Don’t start worrying though, clickthrough rates are generally quite low, as you can see here in this Google benchmark data

Start by looking at your average clickthrough rate. Find what is a normal clickthrough rate for you and your industry. Then, compare each of your ads against your average. When you find ads that are below your average, those are the ones that most need some improved ad copy. Here are some tips to improving your ads.

Conversion Rate Is The Measure Of Landing Page Success.

The conversion rate is about action, action, action. This rate is the number of visitors who take the desired action of the ad, for example, completed a purchase, downloaded a brochure or subscribed to your newsletter . Simply put, conversion rate is number of visitors who have completed the action that you wanted to take divided by the total number of website visitors. Whereas clickthrough rate indicated how interesting your ad is, conversion rate can tell you how successful your landing page is (What is a landing page?).

In other words, once your ad has attracted potential customers to your website, your landing page’s job is to help these visitors complete an action. Conversion rate is a measure of how successful your landing page is at helping visitors do what you’d like them to.

While there are average conversion rates for different industries, I recommend focusing on improving your existing conversion rates, rather than worrying about other businesses. My tip is to start with improving the conversion rates for products or services that are most valuable to you over the long term.

Improving conversion rates often means re-designing your landing page to better meet the expectations of your visitors. Make sure that the landing page content is very relevant to the ad the visitor clicked on. Also, avoid distracting popups and irrelevant links off the page. Oh, and of course, you should have a clear, compelling call-to-action that leaves the visitor in no doubt as to what they ought to do next.

Bounce Rate Is The Measure Of Interest.

Now the inverse to conversion rate is bounce rate. This is the percentage of visitors who come to your website and leave (or bounce) without taking a look or any other actions on your site. So this is a measurement of retention. Are people getting the info they need then leaving? Are they turned off? This metric will help understand what makes people stay and go.

If you’re a blogger, and share specific posts through social media, bounce rate will naturally be high because people will come to your site, read the post and close the window, having read your article. That’s ok. But when it comes to AdWords, you want to continuously lower your bounce rate. In the AdWords experience, bounce rate indicates the number of people who clicked on your ad, visited your site and left without having done anything, not even explored further.

Related: Does your bounce rate matter?

In a content heavy site like a blog, improving your bounce rates will be very much about link and content relationships. Always add links, lots of em. Links to similar pages of content within your site. Links to guides and other informational bits and bobs that will help with a possible sale. When it comes to your ad’s landing page, you don’t want lots of links. Instead, you have a specific action you’d like your visitor to take. So improving your bounce rate means prioritizing your call to action.

Make sure that the call to action is clear, easy to complete and compelling. Including trust indicators on your page, like testimonials or association badges can help too. Include minimal links to “learn more” but do indeed have an option for the customer to get more information. Ultimately, the best way to improve your bounce rate (and your conversion rate), is to have great content on your landing page that is exactly what the visitor expects to find after they click on your ad.

Is Anyone Even Seeing Your Ad? Take A Look At Impressions.

Before anyone can click on your ad they have to see your ad first. This is an impression. Whenever your ad appears on a Google search, it is counted as one impressions. These are not measured by actions taken but rather are only counted if the ad was seen. So, what do impressions (or impression share) matter?

Impressions highlight opportunity and possible issues. Let’s start at AdWords basics: if your impressions are very, very low it means no one is even seeing your ad. It could be because you’re advertising on keywords that are too obscure. Or, it could be that your ad and landing page are not relevant to the keyword you’re advertising on so Google isn’t showing your ad. Both these possible issues are easy to uncover and fix.

It’s also possible that you’re bidding too low. Generally, Google will make this obvious by telling you your bid is below first page and what the recommended bid is.

Impression Share is worth discussion too. This metric tells you how often your ad could have shown. For example, if your impression share is 60%, it means that you’re missing out on 40% of the opportunities to have your ad shown. These primary reasons for this are budget and bid.

If you’re reaching 100% of your daily budget but your daily impression share is 80%, then the solution is simple. Increase your budget to keep your ads running. If you’re not reaching your budget and you’re not showing every time, then increasing your bid can make your ad more competitive and thus shown more often.

When aiming to increase your impression share, keep your business goals firmly in mind. If your budget is limited, or you’re getting good results anyways, there’s no reason to fuss about impression share.

AdWords Is Complex, So Keep It Simple

The world of metrics can become overwhelming quickly, with much uncertainly of what to analyze. It may even feel discouraging at first glance. The trick to having a successful AdWords experience is a good foundation. Make sure your website content is clear and understandable and provide an enjoyable experience on your site. Only then should you explore these four metrics to create simple adjustments with your website or ads and just take it step by step.

Respect your site’s visitors, and they’ll become customers. 

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