There are so many digital mediums today, and they seem to expand and change infinitely. For marketers, the rapid developments make it difficult to know which metrics are useful in assessing their PPC strategy. The confusion can make it difficult to come up with solutions to marketing problems. To simplify things, focusing on these four metrics can be enough.
Cost per click
Cost-per-click, or CPC, measures how well the audience is responding to your digital advertisements. It is significant in determining the rank of your ad on Google. If Google decides your content is quite useful and helpful to users, your CPC will be cheaper. By setting your maximum CPC bid, you can make a successful campaign that even comes in under budget. This, and the increased sales opportunities, can quickly increase your ROI and make your campaign worth it.
Conversion rates are measured according to the percentage of guests on your site who complete the action or series of actions you are urging them to take. It increases whenever there is someone making a purchase, downloading a guide, or filling out a form. Buying clicks is senseless if it does not make any revenue-driving sales, and your conversion rate lets you know if the clicks you bought was worthwhile.
When you change the layout of your website, or update its contents or product description, pay close attention to the conversion rate to know if the changes were effective. This metric also helps when comparing different audience segments and channels.
Also known as CTR, your click-through rate shows the approaches that incite responses, particularly those with incentives or taglines. You will have a good CTR if you have found the appropriate audience and are able to effectively connect with them. It is also a strong indicator if your tactic does not resonate well with your audience. You will quickly find out if you should adjust your strategy by closely monitoring your CTR. A better CTR can enhance your conversion rate.
Cost per conversion
Cost per conversion or cost per action shows how much it cost you to have a real customer who successfully makes a conversion. It is the ratio of the number of ad views to the number of completed conversions that resulted from these ad views.
Your cost per conversion is considered to ultimately determine whether a marketing strategy is worth the investment. If you track the cost per conversion, you are making sure that you are not spending more on gathering and nurturing leads than you are gaining in ROI. An efficient way to measure if your campaign is worth it is to compare your cost per conversion with CPC, instead of the click-through rate.
Bonus: problematic metrics
There are several metrics that can cause confusion and problems for marketers, and here are some of them:
Tracking the number of new users is more important than tracking monthly users. The number of returning customers do not indicate how many new ones were driven by your ongoing campaign to a specific landing page.
It can be misleading, as guests who dig your site for hidden content can increase the numbers, while glossing over other issues.
While tracking how many people quickly left your website is important, you should also troubleshoot what caused them to leave. Did they come upon your site on accident, or were they frustrated by the contents and interface?
From the first day of a campaign, you should make sure that your metrics are working effectively. You can track ROI more accurately by doing so. Also, check your data points weekly but do not make big changes as often. Do not put too much emphasis and resources into confusing and unnecessary metrics. Bad data is useless, while smart data lets you develop more effective campaigns.