Part
4 - Tracking and ROI
By Derek Vaughan
http://www.cpureview.com.
In Part 3 of this series, we learned how to precisely
limit the distribution of your Google AdWords ad to only
those prospects who are most interested, and how to beat
the competition with creative bidding strategies. In
this installment, we'll learn how to:
- Track the results of your ads and campaigns
- Create a Return on Investment (ROI) report
Tracking and Results
From the moment your AdWords account becomes active,
it begins to generate valuable data that will help you
optimize and fine-tune your marketing activities. In
order to bill you correctly, Google must carefully
monitor the number of clicks that each and every one of
your keywords and search phrases generates. Not only
that, they also have to report on what your active bid
was at the precise moment that each click was generated.
It is important that you familiarize yourself with
the reporting data that Google provides. Experience has
shown that, although one may generate a vast list of
search terms, keywords and phrases, it is invariably a
very small subset of these search terms that generate
the lion's share of cost and clicks. The click reports
will alert you to this, and help you optimize your
activities.
Some advertisers may have the capacity to track a
click directly from a particular site and keyword back
to the sale of an item at their site through the use of
'cookies' or other online tracking methods. If you have
the ability and resources to create unique tracking URLs
for each keyword or search phrase, I highly recommend
doing this. The ideal situation for a any advertiser is
to know which specific keywords, titles, descriptions,
and products are driving the highest return on
investment (ROI). Even if you are not capable of
tracking a click through to sale, I recommend
maintaining an ongoing ROI report as described below.
Closing the Loop - ROI Reports
Below is an example of a general Return on Investment
(ROI) report similar to one that I've used extensively
to manage cost per click sites, and to optimize our
advertising dollars spent there. While it can be
somewhat time consuming and resource intensive to
generate a report such as this from your actual results,
it is well worth the effort if you reveal information
that saves you money on bids, or dramatically increases
sales.
Please glance through the following report format.
Each element is described below.
- Site: The cost per click site
that generated the clicks for this reporting period
for this keyword.
- Keyword: The keyword or search
phrase that generated the click and cost data.
- Total Cost: The total dollar cost
for all clicks associated with this keyword over the
reporting period.
- Estimated Impressions: An
estimate of how many times the ad listing was
actually viewed whether it was clicked on or not --
this data is available from your AdWords reporting.
- Clicks: The total number of times
the ad listing was clicked during the reporting
period.
- Average Cost Per Click: The
average cost per click during the reporting period.
- Clickthrough Percent: The number
of clicks divided by the number of estimated
impressions for the reporting period.
- Sales: The total number of sales
generated by this keyword during the reporting
period.
- Cost Per Sale: The total cost
divided by sales for the reporting period.
The key to successful ROI is to manage your campaigns
by sales. The optimum campaigns are driving the highest
volume of sales for the lowest possible cost per sale.
If you're optimizing your listings according to how many
sales they make and the cost of those sales, you have
mastered the secret of the ROI report.
Summary
The purpose of this series is to get you started with
a solid foundation of great information learned through
years of day-to-day experience with cost per click
sites. The tips included in this series should place you
well ahead of your competition in the quest for more
sales and lower costs in Google AdWords. This is only a
beginning, and you will develop your own style,
methodologies and secrets as you become more familiar
with the Google AdWords product. I wish you well in your
online endeavors!
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Derek Vaughan has extensive online marketing experience, including marketing ecommerce at ESPN.com. and NASCAR.com, and directing marketing for Affinity Internet and Aplus.Net in the highly competitive Web hosting arena. He is currently director of
www.cpureview.com
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