click-through rate

The PPC Metrics You SHOULD Be Focusing On

Last Updated: October 13, 2016

If you’re handling your own PPC with AdWords or Bing Ads, hats off to you! It’s not an easy undertaking. However, it’s certainly doable once you become more familiar with industry vocabulary and best practices.
Learning the right terminology and approach can take time, though. One common stumbling block, even for experienced DIYers, has to do with metrics. Oftentimes, business owners are focusing on the wrong PPC metrics and therefore aren’t getting the most out of their campaigns.

Look Beyond Traffic-Based Metrics

At the end of the day, what’s the goal of your PPC campaign? Our guess: profit.
For this reason, our first suggestion is to stop focusing so much on traffic-based metrics. These metrics are all that’s included in the simplified AdWords dashboard, which is why so many business owners don’t look beyond them. These include:

Impressions
Clicks
CTR (click-through rate)
Average CPC (cost per click)

To be clear, it’s not wrong to look at these metrics—it’s just limiting to your overall understanding of your campaign. These traffic-based metrics only tell you how often your ads are being viewed and/or clicked. And while traffic is definitely something you want to pay attention to—after all, you need people to see your ads in order to interact with them—it doesn’t paint a full picture of how well your campaign is actually doing. Maybe you’re not getting a ton of clicks on a certain campaign, but if you’re getting a lot of paying customers out of it, who cares?
That brings us to what you should be focusing on.

Related: The Four Most Commonly Misunderstood PPC Metrics

Track Your Ads’ Conversion Rates

When you want to measure how well your ads are performing, look at the conversion rate. This is the only way to tell whether your campaigns are actually helping your business make money. It’s one thing for people to click on them, but that’s not enough: you also need to be converting those clicks into leads. Clicks alone aren’t going to help your business grow (unless, of course, your only goal is to create brand awareness).
You can set up conversion tracking on Google AdWords and Bing Ads yourself. Then, just sit back and check the reports as they develop.
Conversion tracking will show you the following metrics:

Cost per conversion: How much each conversion costs (on average).
Conversion rate: How often a click leads to a conversion.
Value per conversion: How much each conversion is potentially worth (you fill this out yourself).
Total conversion value: The total value of all conversions.
Conversion value per cost: How much each conversion is worth compared to how much they cost.
Conversion value per click: Total conversion value divided by total number of clicks.

And don’t forget to track phone leads in addition to online leads (newsletter signups, form submissions, purchases, etc.). For many businesses that provide local services like accounting, massage therapy, HVAC, and so on, the phone is the primary way customers contact them.
If you’re banking on phone calls, then you definitely need to incorporate phone tracking into your conversion monitoring. Assign a unique call-tracking number to each campaign so you can identify which ad generated which lead.

Go a Step Further and Calculate ROI

If you really want to be a PPC rock star, then you can calculate the ROI of your campaigns. Doing so will tell you which ads are actually generating money for your business (as opposed to just traffic or leads).
Calculating ROI is rather complicated, and there are several different methods you can use. One helpful tool is a customer relationship management (CRM) software that tracks all of your leads and sales data. A CRM will prevent you from having to record everything manually.
Regardless of where or how your sales data is stored, you can calculate your ROI by comparing how much you spent on each campaign (including cost per click and cost per conversion) and how many sales dollars it generated. The result is a concrete number that tells you which PPC campaigns are most contributing to your bottom line.

All Metrics Fit Together

There’s no single metric that tells the whole story on its own. Likewise, there’s no metric that you should just flat-out ignore, either. Look at all of the metrics together like pieces of a puzzle.
For example, you can tell if something is wrong with your landing page content if you have a high CTR (meaning lots of people are clicking on your ads) but a surprisingly low conversion rate. Clearly, people are interested in your ad but are then turned off by your landing page. Now you know it’s time to make that content more compelling so your visitors will feel motivated to fill out a form, contact you, or take whatever action is your goal.
When you put all of the above information into practice, you’ll be in a much better position to maximize your conversions and get more bang for your PPC buck.
Still unsure of the best strategy for weighing your PPC metrics? Would you feel more comfortable in the hands of a professional? The team at Prospect Genius offers effective pay-per-click marketing management and transparent pricing. Call now to find out how we can help.

Four Ways Your PPC Services Could Be a Rip-Off

Last Updated: July 13, 2016

“Where’s my money going, exactly?” If you’re paying an online advertising company for PPC services, this is a question you should be asking.
A disheartening number of providers don’t offer any type of transparency when it comes to billing, clicks, or campaign performance. Unfortunately, there are several ways your PPC services provider could be ripping you off without you even realizing it. When PPC providers don’t offer transparency, you pay dearly.
In this post, we’ll highlight a few of the hidden dangers that result from a lack of transparency in PPC advertising. Be on the lookout.

1. Mysterious Management Fees

It’s not uncommon for online advertising companies to charge a management fee for PPC services. However, the problem lies in whether they disclose their management fee to you.
Far too many providers pocket a large chunk (sometimes over 50%!) of your budget as part of their management fee—without telling you. This could mean less than half of the money you’re paying is actually going toward clicks.
But they won’t tell you this. Usually, the best you can hope for is a passing acknowledgment of their management fee’s existence as part of your service charges. It’s rare to have a company tell you exactly what this fee is.
And because of this total lack of transparency, some providers may sneakily pocket more and more of your money while spending less and less on clicks. They’ll squeeze every last penny they can from you before you finally notice a problem and fire them.
Take a look at your last PPC services bill. Did your provider note the exact cost of the management fee? We’re guessing not.

2. No Ability to Check Your Campaign Performance

If you aren’t spending at least a certain minimum amount on clicks (which varies by location and service category), your ads won’t perform. Plain and simple. And if your PPC provider is pocketing half of your budget, there’s a good chance you aren’t spending enough on actual clicks. Diminished performance is the result.
So, to prevent you from detecting an issue with your PPC spending, many providers will try to keep you in the dark. Most often, they do this by not providing access to reports on your campaign performance. This way, you can’t see how much is going toward clicks or how your ads are ranking. When you can’t see these reports, you can’t see how little they’re spending on advertising your company and how much they’re pocketing.
Ask to see a report of your campaign metrics. If your provider can’t give you access to one, that should tell you something.

3. Reporting Only One Metric

Other times, instead of not showing you any performance metrics for your ads, a PPC provider will show you one metric. The problem with only revealing one metric is that you don’t get the full context of that number.
For instance, if your provider focuses solely on click-through rate (CTR), then you miss other important factors, like total impressions (the number of people who saw your ad). Let’s say your campaign has a CTR of 66%. That sounds great, right? Well, it’s great until you realize only 9 people saw the ad and only 3 people clicked through. Conversely, a CTR of 0.5% sounds pretty dismal on the surface. However, 0.5% could mean 10,000 people saw your ad and 50 of them clicked through. Aren’t 50 clicks significantly better than 3?
The lesson here? Context matters. Don’t be fooled by a company that manipulates only one metric so you can’t tell how much money you’re actually wasting.

Read more: “The Four Most Commonly Misunderstood PPC Metrics.”

4. No Control Over When Your Budget Is Spent

Oftentimes, the dollar amount of your total PPC budget is the only say you have. Once you’ve set your budget, you have virtually no control over how and when that money is handled. That’s why most business owners aren’t aware of how their PPC budgets are spent. Some questions to ask:

Is your click budget portioned out so it lasts all 30 days of the month?
Is it exclusively spent during peak days and times?
Is your budget used up all at once?

The timing of your click spend may not be something you’ve put a lot of thought into before, but it actually has a huge impact on your campaign’s overall performance. For example, if your budget is portioned out little by little, and there’s only a small amount of money leftover (after the substantial management fee) for your clicks, then your ads will only run for an hour or two each day. Obviously, this is not going to provide you with satisfying results.
To better understand how your money is being spent, you need to find out when it’s being spent.

How to Avoid Being Ripped Off

Don’t let this blog post scare you away from PPC services. PPC is a super-efficient way to attract leads, even if it’s a little pricey. The trick is to find an online advertising company that’s honest and professional.
For instance, at Prospect Genius, we do charge a small management fee for PPC services; however, we tell you exactly how much it is so you can see what’s going to Google and what’s going to our team. And if the portion reserved for AdWords clicks won’t be enough to support a strong campaign, then we’ll tell you not to do PPC at all. Why? Because the meager results wouldn’t be worth your investment. Unlike other companies, we refuse to just pocket our management fee while your business flounders.
Furthermore, we provide our clients direct access to campaign reporting. With these reports (easily accessible by logging in to your portal account), you can see how much we’re spending each day, your average ad position, and even what each ad looks like! We also develop an ad schedule with you, so you can have a say in when your ads appear.
Shed some light on your PPC services! Talk to your provider to get some answers. Or feel free to get in touch with Prospect Genius to discover how we’re different.

READ THIS: "4 Things Most Leaders Don't Know About SEO"

Last Updated: June 11, 2015

By now, you’ve heard of the term “search engine optimization” (SEO for short), and at least recognize that there’s a lot of significance behind it. However, according to a recent article on Search Engine Land, there’s still a lot about SEO that business owners don’t know.

In his article, “4 Things Most Leaders Don’t Understand About SEO,” columnist Trond Lyngbø describes a major problem with business owners and SEO—mainly that they perceive SEO as a quick fix, an add-on, instead of the holistic approach to online marketing that it should be.
Here are the five most significant points from Lyngbø’s article:

SEO should be incorporated into every aspect of your marketing, including PPC.
Before you can begin creating optimized content, you must do your due-diligence and research your audience’s needs and interests. This way, you can attract your ideal prospects. Then, once they’ve visited your website, your content will demonstrate an understanding of why they need your product or service. This is what will grow your conversion rate.
In order to optimize your content and get the highest click-through rate, your company’s branding (i.e. messaging) must connect with what your prospects want to hear. In your advertising, you should be offering answers to their questions and solutions to their problems. Lyngbø writes, “Your story becomes more interesting when you talk about what they are already interested in.”
But SEO means more than just targeting the right keywords and content. It also means structuring your website so that the code is search engine friendly, pages load efficiently, navigation is easy, and internal links are sound.
However, SEO is not a cure-all. You must have a good product at the center of your marketing. That’s not only because you want your customers to spread the good word, but also because customer reviews will soon become a crucial ranking factor: “[Google] wants its users to keep coming back, so it will ultimately strive to suggest only high quality products and services which their users will love.”

Read the full article for further details, and feel free to check out additional columns by Trond Lyngbø on Search Engine Land.

The Four Most Commonly Misunderstood PPC Metrics

Last Updated: April 16, 2015

Confusion
Look. Online advertising isn’t easy. Not only is it time consuming—it’s downright confusing. Why else would there be an entire industry made up of professionals who have devoted their days and years to studying the nuances of online advertising? If it were easy, every business owner would be doing it themselves, and everyone would be successful at it. Unfortunately, that’s just not the reality.
PPC is a prime example of how confusing online advertising can be to the uninitiated. With so many metrics and data points to look at, the majority of DIY users often wind up misunderstanding what they’re looking at, or they put too much emphasis on a single metric.
Here are the four most commonly misunderstood PPC metrics and what you should really know about them.

1. Click-Through Rate (CTR)

Click-through rate (CTR) measures the ratio between people who see your ad and people who actually click on it. If you only focus on CTR, which is presented as a percentage, then you’re not seeing the total number of people who are actually looking at your ad and engaging with it. A percentage is not representative of the big picture. It doesn’t give you actual numbers, and it certainly doesn’t tell you whether or not you’re getting a good return on investment.
For example, let’s say you have a 90% CTR. That sounds incredible on the surface, but what if it turns out that that 90% is really just 9 clicks out of 10 impressions? Already, you realize that those numbers aren’t very good. But it gets worse, especially if your goal is to be closing jobs and generating more revenue than what you’re paying for PPC. In this scenario, if we consider that converting clicks into customers at a rate of 10% is the standard, then you’re probably only gaining one new customer per month at best. As it turns out, that 90% CTR isn’t good at all. But if you hadn’t looked at other data points, then you would’ve had no idea and you would have continued to throw money at a flailing campaign.
Conversely, you could have a 1% CTR, which seems pretty low at first glance. However, it could turn out that you’re actually getting 100 clicks out of 10,000 impressions. And when you apply the 10% rate of converting clicks into jobs, then you should be getting around 10 jobs per month. That 1% CTR isn’t so bad, after all.

2. Cost per Click (CPC)

Cost per click (CPC) is exactly what it sounds like—it’s the amount you pay for each click. You can set your own CPC budget to not go over a certain dollar amount (either per click or as a daily average each month) if you’re concerned about keeping costs low. However, it’s important to note that focusing exclusively on your CPC will lead you to ignore other important factors, like industry standards. If your company is in a high-demand industry, then all of your competitors will be paying a high CPC. You’ll need to adjust your budget accordingly if you want to remain competitive. Saying that you only want to spend $10 per click, no matter what, won’t do you any good.
Focusing solely on CPC might also stop you from thinking outside the box when it comes to ad spending. First, think about why you want to keep costs so low. Is it because of a small budget? There are better ways to handle a small budget than by arbitrarily setting CPC limits. For instance, you could focus your ads on super-specific, targeted keywords that won’t cost too much but will get you better leads. You could also spend a higher amount for a shorter period of time (like $30 per click for the first 9 days of the month) instead of paying for clicks the entire month. If that’s still too pricey, then you might want to opt for the more economical advertising options on Facebook instead of using Google AdWords.

3. Monthly Spend

We have a lot of clients who wish to set a constant number (usually around $300) for AdWords spending each month. For budget-planning purposes, this makes sense to us. But we have a lot of clients who also say that they want their $300 budget to be spent evenly throughout the whole month. This doesn’t make as much sense to us. Frankly, it’s a terrible idea.
To a person who doesn’t deal with AdWords and countless metrics on a daily basis, it probably seems like a reasonable request: You want to make sure your money lasts the whole month. But that’s not really how AdWords works. If your budget runs out by the twentieth day of the month, that means lots and lots of people were clicking on your ads. In other words, your ads were successful.
Plus, with all of the data we collect on a daily basis, we know that there are natural spikes in impressions throughout the day and week. We want to be capturing as many clicks as possible from these spikes—but if you’ve put a cap on the amount we can spend per day, then your ads won’t reach their full potential. It’s important to stick to a monthly spending budget, but you should be flexible when it comes to how those dollars are used.
Moreover, if your budget does run out early, you’ll get the chance to decide whether you want to expand your budget before the end of the month. This would allow you to reach even more people than you anticipated. Remember, the more you spend, the more people you reach. And isn’t that the whole point?

4. Ad Position

It’s a very common myth that having the #1 ad position is the ultimate advertising goal. In truth, you really don’t need to have the #1 position—and you might spend way too much money trying to do so. Being high in the ad rankings is not always best. In fact, there have actually been studies reporting that position #10 gets more clicks than positions #4-8. It’s a surprising finding, but it makes sense when you think about your own browsing habits. Don’t you usually scan right over the middle of a page, focusing mainly on the top and bottom? As it turns out, that’s what most Internet users do, too. In many cases (especially when your monthly budget is the most limiting factor), there’s no sense in draining your budget trying to get your ad in the higher positions.

See the Forest for the Trees

The bottom line is that you have to make sure you’re looking at the full picture in addition to individual PPC metrics. While AdWords metrics are extremely helpful when taken in the right context, remember that there is inherent value in raw data, as well. The more numbers you look at, the more accurate picture you’ll have of your campaign’s performance.

When Pay-Per-Click Becomes Pay-Per-Search

Last Updated: February 15, 2024

We have a lot of clients who like to periodically search for their business on Google. Understandably, they’re curious as to how their campaign is performing and, if they’re pay-per-click clients, they want to see how their sponsored ads look on the search results page. But here’s the thing: Frequently googling your company can actually sabotage your campaign.
This is especially true for companies enrolled in any type of pay-per-click advertising, particularly one using Google AdWords. Here’s why.

Impressions, Clicks, and Quality Scores

The performance of your ad largely depends on the ratio of passive views to active clicks. An inflated number of views means an inflated cost per click. But why?
As we’ve discussed previously, AdWords uses a Quality Score system to ultimately determine the cost that a given account will have to pay per click of ads and keywords. Since Google only wants to endorse “quality” content, a low Quality Score means you’ll have to pay a much higher cost per click if you want your ads to be displayed.
An account’s overall Quality Score is highly influenced by click-through rate (CTR) and relevance. A low CTR or lack of relevance will significantly decrease your overall Quality Score. While it’s easy to achieve relevance—simply target ads by keyword and location—it’s a little more challenging to boost an ad’s CTR.
CTR is calculated by comparing the number of “impressions” (how many times the ad appears) versus the number of “clicks” (how many times a viewer actually clicks on the ad). So when you’re continually googling your company’s name and search terms to check out your sponsored advertisement, you’re spiking the number of impressions without adding to the number of clicks. In effect, you’re lowering the CTR of your own ad.
Unfortunately, this effect doesn’t stay exclusive to the particular ad or ad group in question. If you have multiple cases of low CTRs, then your whole AdWords account will ultimately be downgraded. As PPCHero explains, “If you have a lot of low CTR ads in your ad groups, they could be contributing to a low Quality Score since AdWords considers all of your ads when calculating your scores.”
And, as we’ve covered, a low overall Quality Score means higher costs for you. In a nutshell: By frequently googling your company, you’re driving up your own PPC costs.

Don’t Learn the Hard Way

Case in point: We’ve had numerous clients in the past who did serious damage to their PPC campaigns just by searching Google for their company’s ads too frequently. One client in particular actually spiked their cost per click from $22 to $31!
We understand the temptation to see how your campaign is performing, but you’re actively holding it back by constantly turning to Google’s search bar. Don’t make the same mistake that our client made. Don’t be an active participant in the downfall of your own PPC campaign.

Seek an Alternative to Googling

We wouldn’t tell you to stop googling yourself without having a viable solution for you.
If the reason that you’re always typing your name into Google’s search bar is that you want to track your campaign’s performance, the solution is simple: Find an online advertising company that offers tracking features as part of their program. At Prospect Genius, all of our clients have unfettered access to all of their account’s call logs, leads, and other reports so they can view their campaign’s progress right from the Client Portal—without having to resort to Google.
If you already have access to these types of features but can’t seem to kick the habit in moments of weakness, just remind yourself of all the damage you’re doing with every search. It won’t be easy at first, especially when boredom or curiosity takes over, but it will be well worth the sacrifice.
For further guidance, call Prospect Genius today!

Prospect Genius