How do you assess PPC ROI?
-
I thought this would be pretty straightforward, but I'm trying to put together my first PPC ROI spreadsheet and it's turning out to be much more complicated than I had anticipated. Would anyone be willing to tell me what you look at to determine the return you're getting on PPC -- and if you're using AdWords and Analytics, what screens/reports you rely on? It seems to be more complex than simply comparing Paid Search Revenue to spend ... but I could be overcomplicating things.
-
To be fair in your example, the Adwords click did (on average) have some effect on the ultimate sale. If the customer never came through the door looking for red widgets, they may not have purchased the blue widgets from you? There are a few different reports in Analytics that can help you see this:
- Conversions > Multi-channel funnels > Attribution Modeling Tool (I think this is available to everyone now). If last-click interaction is by far the most important for you, you can select this in the tool and select the primary dimension of Source/Medium. Drill into Google / cpc and you should see the data you're looking for there.
- Conversions > Multi-channel funnels > Top conversion paths. Select primary dimension Source/Medium Path. This will should you the different parts that Adwords played in each conversion. You can also pick a secondary dimension of Adwords Campaign Path to see more info.
-
I'm not sure you can cover every angle or scenario.
We've found our data to be reliable enough to make good decisions.
-
How do you determine which revenue is directly attributable to AdWords?
-
Yes. Then you'll have to factor in the other costs associated with the sale like shipping, handling, discounts, etc.
There are some unknown variables such as repeat sales that are acquired from the initial conversion and/or volume purchases made after the initial conversion (assuming there are any).
-
Do you rely on AdWords' cost per conversion numbers?
-
I'm looking to compare spend to revenue from transactions that are directly attributable to that spend. So if I know how much I spent between Oct 1 and Oct 31, I want to know how much revenue resulted from those clicks. Not how many transactions occurred during that period, since that might include clicks from before Oct 1.
The problem is, AdWords includes conversions where the paid click might not actually be responsible for the transaction. If someone searches [red widgets], clicks an ad, comes to our website, leaves without purchasing, searches [blue widgets], clicks an organic result, and purchases, Analytics will correctly attribute that sale to organic. AdWords, however, will include that conversion in its cost/conv metric. Skewing the cost/conv number lower, I might add.
I've spoken with several AdWords/Analytics googlers about this, and they don't seem to know of a report that does what I want. I guess I'm wondering if others are trying to measure the same thing, or if they're comfortable with the less precise AdWords-supplied cost/conv figures.
-
I sell a downloadable product and a significant amount of my revenue is from Google adwords. We track the conversion rate of every keyword. An important factor is the click through ratio. You can get a lot of clicks and few orders. The important thing is to get the balance right. Any keyword with the word free will get a lot of clicks but very few orders.
Another important factor is to ensure that you are using negative keywords properly. On my site we sell generic set of speeches. We would have a negative keywords for therapy or disorder. Somebody looking for content to help with a speech is not interested in speech therapy or speech disorders.
Another area is to check your ROI in different countries, and only bid for clicks in countries where you can make an adequate ROI
-
Know your margins and watch the cost per conversion for your products.
Eventually, you'll get a good idea of what I call a "conversion threshold" which tells me what I can expect to spend to convert that product to a sale. From my experience, once the conversion threshold is determined, it won't deviate far from it over time.
If my net on the product is $20 and my conversion threshold is $12 then I'm making money (excluding cost for shipping, handling, promo discounts etc).
If the threshold his $18 or $22 then I re-think what to do with the product.
I'd put together a report that shows product cost, retail price, margin, net and cost per conversion. It should be quite telling.
-
I built my own Google Analytics custom reports which I export and add a few equations to in order to track ROI. I do it for a subscription site so it's not quite as complicated as it would be for an eCommerce site, where each purchase can have different items, margins, cost of goods sold, etc. What are you looking to see beyond paid search revenue to spend?
GA may be making this easier in 2013 with their "Universal Analytics" offering: http://analytics.blogspot.com/2012/10/google-analytics-summit-2013-whats-new.html.
Got a burning SEO question?
Subscribe to Moz Pro to gain full access to Q&A, answer questions, and ask your own.
Browse Questions
Explore more categories
-
Moz Tools
Chat with the community about the Moz tools.
-
SEO Tactics
Discuss the SEO process with fellow marketers
-
Community
Discuss industry events, jobs, and news!
-
Digital Marketing
Chat about tactics outside of SEO
-
Research & Trends
Dive into research and trends in the search industry.
-
Support
Connect on product support and feature requests.
Related Questions
-
Will pausing my AdWords PPC campaigns impact my organic rankings?
Over 95% of my revenue comes from organic search; less than 5% comes from AdWords PPC (all other sources account for about 1-2%). My ROI on AdWords is roughly zero. It's negative if you include opportunity costs. My question is: if I pause all of my AdWords campaigns, is there ANY chance that my organic rankings (and organic click-through rates) will suffer? This is really two questions. First, could Google retaliate to my reduced ad spending by dropping my rankings? Second, will searchers think differently about my organic link if they don't also see the accompanying paid link on the SERP?
Paid Search Marketing | | ahirai2 -
How to improve good ppc campaign?
Hi guys, I'm managing PPC campaign for one of my client.
Paid Search Marketing | | EdmondHong87
Its locksmith campaign in the US, so you can imagine that the competition is very high. We are getting really good results. almost 50% conversion rate, all the keys are in average position of 1.5, the quality score is high (between 6-10),Search Lost IS, is really low. Everything split to group, zip code, cities, for mobile or desktop... basically everything is going really well. BUT as we always want to increased the results and like all if us we have the presser from the client to improve and get more results, i feel that im a bit stuck. What other stuff i can do to improve\extend the campaign ? Any tips are more then welcome!0 -
PPC sessions being counted as organic in GA
I am coming across a very frustrating phenomenon in one of my PPC campaign reporting. In short: I believe that GA is counting some of my PPC sessions as organic (not provided). Has anybody come across this before? I believe they are being counted as organic because of the following: the website is brand new and does not rank for anything but their branded terms the few keywords showing up in GA are the terms we target our PPC towards the amount of sessions of Paid Search (in channels) and AdWords sessions don't match up (The number of actual PPC clicks is substantially higher than the Paid Search sessions) PPC clicks and sessions don't even match up in the AdWords part of GA GWT shows 0% CTR for any non branded terms Tell me I am crazy, but I really don't think I am. I just don't have the hard evidence to back it up. Any help is greatly appreciated.
Paid Search Marketing | | Rebecca.Holloway0 -
Is there a tool that can use measure and improve the quality score of my PPC landing pages?
Hey guys, I'm trying to improve the quality score for a few of my PPC landing pages. Does any one know a Tool that can help me in the process. Something kind of like the "on page grader" but for quality score. Thanks
Paid Search Marketing | | Felip30 -
What to do against competitor PPC sabotage?
This morning a competitor of ours decided to go on a PPC rampage against us. Basically our budgeting money was spent within the first hour of going live on bing. Its pretty obvious whats going on as we had a tremendous amount of clicks all from the exact same keyword within a short period of time. Obviously first step was to contact bing and they are going to refund me a credit once they go through their process, but they didnt really give me confidence about the future. It seems they may not be able to prevent this from continually happening.. ? The attacker used some sort of IP spoofing as the clicks were all from different IP's which is probably why it snuck pasted Bing. Wondering what have you guys done in the past to prevent this or combat it? Thankfully it didnt happen on google
Paid Search Marketing | | DemiGR0 -
PPC question for the experts
I know this is paid search but since Moz had a section for it, I thought it would be ok to ask. 🙂 According to: http://support.google.com/adwords/answer/2497836?hl=en Broad match modifier +tennis +shoes Ads may show on searches for tennis shoes
Paid Search Marketing | | MattAntonino
buy tennis shoes
best shoes for tennis Ads won't show on searches for running shoes
tennis sneakers I'm using (for a client) +wedding +photographer. It should show on wedding photographer hire a wedding photographer best wedding photographer in dallas It should not show on photographer in Dallas become a photographer dallas pictures But it is. Why would this happen? Isn't that exactly what it says it won't show up on? Also, Google writes: Don't leave space between the plus sign (+) prefix and the word you're modifying! •Correct: +leather +shoes
•Incorrect: + leather + shoes
•Incorrect: +leather+shoes Yet the client was told by Google the opposite. "I spoke with Google and they confirmed that the space after the plus and before wedding (“+ wedding”) would notrequire “wedding” to show up." How on Earth does this reconcile or make ANY sense? ETA: This is fairly clear to me: Be sure there are no spaces between the + and modified words, but do leave spaces between words. The right way to do it: +formal +shoes. The wrong way to do it: +formal+shoes. http://www.google.com/ads/innovations/bmm.html0 -
What are the best ways that PPC and SEO can work together?
This has come up recently internally as we are an agency that traditionally only focuses on SEO. However, when asked to articulate the benefits of how they can work together I normally see rather vague and non-actionable answers that don't really translate to real life always. I can understand how you can use SEO techniques to improve the ROAS of a PPC campaign by improving the quality of a landing page. I am also aware of a number of ways you can use Adwords data from your campaign to improve your SEO campaign but I am curious to know. How else can the two channels work together to help each other out?
Paid Search Marketing | | SearchAcademy0 -
Wordwatch Software: PPC Adwords campaign managers heard of, tried, or actively using this?
I've been trialing WordWatch for about a month. I'll admit I've been skeptical from the start. I don't quite understand the results they're delivering or how it works. So I did a search for "Wordwatch review" hoping someone out there could shed some light or help me decide whether this software was worth keeping. But all I can find are two suspicious and badly written posts, immediately raising red flags. (Penuguin should have eliminated crap sites using the Flesch-Kincaid reading level, but I digress.) **Wordwatch premise: **They take over keyword bidding to maximize budgets and clicks. They monitor the Adwords campaign to find an "optimal" bid price. Two questions about this premise: How is it different than using the Google settings for optimize for clicks or conversions? Since Google Adwords is based on a Vickery auction, wouldn't lowering my bid only lower my position? Bearing everyone has the same QS, then lowering my bids to the range between 2 positions does not increase my actual cost. I have Wordwatch enabled for a few of my campaigns. Their interface leaves a lot to be desired. They don't report the activity or the changes they make to the campaigns from the dashboard. I had to go into my Adwords Change History to track what they were doing. And lo and behold they're also adding long tail keywords to my ad groups. Bottom line I didn't notice any huge impact, and I don't see how it's better than Google's own version of campaign settings. I don't know that they're really legit. But their marketing was so convincing, and they raised $1.4M that I need other opinions. Any one with some pro/cons, or yay/nays?
Paid Search Marketing | | flowsimple0