How to measure Google AdWords performance

When new to AdWords, it can be a little confusing and overwhelming. Trying to understand what you’re supposed to keep track of and what it means can leave you misunderstanding the numbers. In this blog, we’ll give you a few tips on what to look out for when trying to measure your Google AdWords performance.

Click-through rate (CTR)

One of the key ways to see how well your campaigns are performing is to track the click-through rate. This measures the number of clicks your ad receives against the number of times it was shown. So for example, if your ad was shown to 1000 people and of those 55 people clicked it then the click-through rate would be 5.5% as that’s the percentage of users that clicked the ad. Depending on the industry and budget, the average click-through rate is around 1.91%.

Conversion rate

A simple way to gauge the effectiveness of your campaign is to simply see often conversions are occurring. A conversion rate is the percentage of users that complete a desired action after clicking on an ad. However, you should be aware of what type of conversion it is. You are able to see specific conversion goals that you’ve set up – so if you only want to see sales or contact form submissions you’re able to.

Cost per conversion

Having a good conversion and click-through rate can be great, but if the return on ad spend (ROAS) is minimal or even negative then those measures mean little. One of the primary ways to measure your Google AdWords performance is to look at the cost per conversion. This will give you a much better idea about the financial viability of the campaign and how much is it really costing you. Firstly, you’ll have to know how much you’re able to spend to acquire a conversion, the standard way to do this is by taking the profit made after selling your service/product and allocating 20% for marketing. This way you’ll know every conversion made is profitable.

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