KPIs to review and improve paid search marketing

5 basic questions to ask about your Google Adwords campaigns

With so much data, systems & best practice guides now available for Pay per click marketing, it is easy to get sucked in to data analysis and in actual fact never end up driving your business forwards. Afterall, there is sooo much to be doing and we only have a limited number of hours in the day, so we have to focus on the right things.

In this note I show what I believe are the right basic questions and related KPIs you should be asking yourself or your agency about.

The one thing I want to stress before starting with KPIs is that no one KPI will give you all the answers. You need to review a number of KPIs, with data over time & an understanding of the full picture before they become relevant & actionable! Analysing data with Week on Week, Month on Month & Year on Year views is a better way to get an understanding

Question 1: "Am I visible to all of my potential customers?"

KPIs : Impression Share, budget

The reach KPIs show how many people are seeing your adverts and how this compares to the opportunity. This obviously assumes you have the right keywords setup etc etc.

If you understand what your budget is currently restricting you in terms of possible advert views then by overlaying other statistics like click-through rate & conversion rates you will quickly be able to see what increasing your budget / visibility will do to your sales.

Checkout this Google report on impression share.

Question 2: "Is my website converting the traffic?"

KPIs : Sign ups / leads & bounce rate

Looking at your landing page bounce rate vs conversion rate will allow you to get an understanding of how well the traffic is engaging with your website.

Obviously if your traffic is bouncing at 80% but converting at 20%, while is far from perfect a 20% conversion is usually a good conversion rate! This kind of analysis should really be done at an ad-group level.

Question 3: "Does it give me an ROI which makes it a worthwhile channel?"

KPIs : Sales, CPS or CPA, Spend

Three metrics make up the answer to this very popular question. Ideally done at an adgroup level but for presentations back to a business / managers an overall metric is usually adequate. Ideally you will have set a target cost per sale or acquisition (CPS/CPA) which you can then use spend divide it by units which will work out how much it cost you per unit. Overlaying revenue vs spend will also help you work out the financial ROI.

Question 4 : "Can I not just spend more money & get more sales?"

KPIs : Impression share, CpS

The answer is usually yes, but it comes down to the target cost per sale. Understanding what you are not currently targeting or reaching due to budget through the impression share report as well as overlaying conversion data you should be able to map with some accuracy what spending more will do to your sales figures.

Question 5: "How do I reduce spend without losing sales?"

KPIs : CPC, CTR & Quality Score

Key to decreasing costs is relevance, this relates back to the quality score your adverts & keywords receive. While this can be affected by a range of different actions & configurations quality score is ultimately about how relevant your keywords are to the adverts displayed & landing pages they land on. We have a separate post where you can find out more about Google Quality Score.

Avoid "analysis paralysis" Action is far more important than analysis

My fear with reviewing data for channels like paid search is that you spend so much time analysing you never actually change much in the account and lose any creativeness you may have. When analysing paid search ensure you write any obvious actions down and commit to completing them within a set timeframe before analysing performance again.