Google Ads Performance Metrics You Should Be Looking For  

Let’s cut straight to the point: When running Google ads, success hinges on how well you outperform your competition. But what many people fail to realise is, it is not whether you outspend your competition, but rather, how precise your data analysis is, that can be the make or break.  

When it comes to Google Ads campaigns, performance metrics are the guiding light, illuminating areas of strength and opportunities for improvement. We have many years’ experience in the development, planning and execution of both paid and organic search strategies and have compiled a guide to the essential metrics you should be monitoring to optimize your campaigns and maximize your return on investment (ROI). 

Introduction: Why Performance Metrics Matter 

Imagine driving a car blindfolded. Sure, you might eventually reach your destination (if you have a really good guide), but the journey would be fraught with inefficiency and frustration. Similarly, running Google Ads campaigns without data is akin to navigating in the dark. Performance metrics act as your headlights, providing crucial insights into how your ads are performing, who they’re reaching, and most importantly, if they’re generating the desired results. 

By diligently monitoring these metrics, you can make informed decisions about your campaigns. This could involve refining your keyword strategy, optimizsing ad copy, adjusting bids, or even revamping your landing pages. Ultimately, data-driven decisions pave the way for campaign optimisation, leading to increased conversions and a healthier bottom line. 

Setting Campaign Goals for Google Ads 

Before launching a Google Ads campaign, it’s crucial to establish clear, well-defined goals. These goals will guide your strategy, help you measure success, and ensure your advertising efforts align with your overall business objectives. 

Why Goal Setting Matters? 

Setting specific goals for your Google Ads campaigns is essential for several reasons: 

• It provides direction and focus for your advertising efforts. 
• It allows you to measure the success and ROI of your campaigns. 
• It helps optimize Google’s advertising algorithms to target the right prospects. 
• It prevents wasteful spending and improves overall campaign performance. 

Step-by-Step Process for Setting Campaign Goals 

Follow these steps to set effective goals for your Google Ads campaigns: 

• Define your business objectives: Start by identifying your overall business goals. Are you looking to increase sales, boost brand awareness, or generate leads? 
• Make your goals SMART: Ensure your goals are Specific, Measurable, Achievable, Relevant, and Time-bound. For example, instead of “increase sales,” aim for “increase online sales by 20% in the next quarter.” 
• Align goals with campaign types: Choose the appropriate campaign type based on your objectives. For instance: 
  • Sales goals: Use Search or Shopping campaigns 
  • Lead generation: Consider Search or Display campaigns 
  • Brand awareness: Example: opt for Display or Video campaigns 

• Identify your target audience: Define who you want to reach with your ads. Consider demographics, interests, and behaviors of your ideal customers. 
• Define your Conversion Goals: Start by clearly defining the specific actions or events that align with your business objectives, these may include: 
  • Product Purchases 
  • Lead Form Submissions 
  • Content Downloads 
  • Phone Calls 

*Leverage Multiple Conversion Actions: If your business has multiple key actions (e.g form completions, phone calls) you can create custom goals that include all relevant conversion actions. This allows for a better optimization strategy.   

• Establish a realistic budget: Determine how much you’re willing to spend to achieve your goals. Consider factors like industry competition and average CPCs. 
• Create a timeline: Set a specific timeframe for achieving your goals. This helps in tracking progress and making necessary adjustments. 
• Set specific metrics: Determine which key performance indicators (KPIs) you’ll use to measure success.  
• Examples include: 
  • Conversions 
  • Click-through rate (CTR) 
  • Cost per acquisition (CPA) 
  • Return on ad spend (ROAS) 

Setting Specific Metrics in Google Ads 

Determining which Key Performance Indicators (KPI’s) to use for measuring success in your Google Ads Campaign is crucial for evaluating performance and making data-driven decisions. Below, we define the most important KPI’s: 

Key Performance Indicators (KPI’s)

1. Conversions

Conversions are actions that you want users to take on your website, such as making a purchase, signing up for a newsletter, or filling out a contact form. This metric helps you understand how effective your ads are at driving these desired actions. 

Examples:  

• If your goal is to generate leads, a conversion might be a completed contact form submission. 
• Number of sign-ups for your monthly newsletter after launching a lead magnet, such as a free e-book or discount offer. 

2. Click-Through Rate (CTR)

CTR measures the percentage of people who click on your ad after seeing it. It is calculated by dividing the number of clicks by the number of impressions and multiplying by 100. 

CTR= (Impressions/Clicks) × 100 

Example: If your ad receives 1,000 impressions and 50 clicks, your CTR would be 5%.

3. Cost Per Acquisition (CPA)

CPA measures the average cost of acquiring one conversion. It is calculated by dividing the total cost of your ads by the number of conversions. 

CPA =Total Cost/ Number of Conversions 

Example: If you spend $500 on ads and acquire 25 conversions, your CPA would be $20. 

4. Return on Ad Spend (ROAS)

ROAS measures the revenue generated for every dollar spent on advertising. It is calculated by dividing the total revenue by the total ad spend.

ROAS= Revenue / Ad Spend 

Example: If you spend $500 on ads and generate $3,000 in revenue, your ROAS would be 6. 

This figure is vital for online stores and websites that convert traffic into dollar value. However, that is not to say that ROAS cannot be calculated for businesses where there are no online transactions. It just requires you to use robust CRM or similar to keep track of leads, returns and the value of each.   

5. Unveiling the Power of Quality Score 

One of the most fundamental metrics in your Google Ads arsenal is Quality Score. As the name suggests, it reflects the overall quality and relevance of your ads, keywords, and landing pages. Google assigns a score (1-10) to each keyword, with higher scores indicating a more positive user experience. 

6. Demystifying Quality Score 

Quality Score is not a single entity but rather a culmination of three key components: 

• Expected Click-Through Rate (CTR): This metric estimates the likelihood of users clicking on your ad when it appears in search results. Relevant keywords with compelling ad copy typically score higher on this factor. 
• Landing Page Relevance: Google assesses how well your landing page aligns with the intent behind the user’s search query. A well-optimizsed landing page that directly addresses the user’s needs will positively impact your Quality Score. 
• Ad Relevance: This component evaluates how closely your ad copy aligns with the keywords you’re targeting. A clear and concise ad copy that accurately reflects the keywords will earn a higher score. 
• Understanding the Components (Expected CTR, Landing Page Relevance, Ad Relevance) 

Understanding these components is crucial for improving your Quality Score. Let’s delve deeper: 

• Expected CTR: Focus on crafting compelling ad copy that resonates with your target audience. Include strong calls to action (CTAs) and highlight the unique selling proposition of your product or service. 
• Landing Page Relevance: Ensure your landing pages are optimizsed for the specific keywords you’re targeting. Incorporate relevant keywords throughout the page content 

Benchmarking Your Quality Score 

While there’s no universal “good” Quality Score, it’s helpful to benchmark yours against industry averages. Google provides benchmarks within the platform, but you can also leverage industry reports and competitor analysis tools to gain a broader perspective. Aim to consistently improve your Quality Score over time. 

Strategies to Enhance Your Quality Score (Keyword Relevancy, Improve Ad Copy, Optimize Landing Pages) 

Here are actionable strategies to elevate your Quality Score: 

• Keyword Relevancy: Conduct thorough keyword research to identify highly relevant keywords that align with your campaign goals. Regularly review your keyword lists and remove irrelevant terms. 
• Improve Ad Copy: Craft clear, concise, and compelling ad copy that directly addresses the user’s search query. Highlight your unique selling proposition (USP) and incorporate a strong CTA. 
• Optimise Landing Pages: Ensure your landing pages are relevant to the keywords you’re targeting. Incorporate those keywords throughout the page content, including headlines, meta descriptions, and body copy. Furthermore, optimizse your landing pages for conversions with clear CTAs and a user-friendly design. 

Maintaining a Healthy Impression Share 

Impression Share is another crucial metric. This one reflects how often your ads are displayed when compared to the total number of times they could have been shown. It’s essentially the visibility of your ads within search results. There are two key components to consider: 

Budget vs. Ranked Impression Share 

• Budget Impression Share: This metric indicates how often your ads were limited due to budget constraints. A low budget impression share suggests you might need to adjust your budget to ensure your ads are seen by a wider audience. 
• Ranked Impression Share: This metric reveals how often your ad wasn’t shown due to ad rank. A low ranked impression share might be a sign that you need to optimise your bids or improve your Quality Score to achieve a higher ad rank. 

Analyzing Search Impression Share 

Search Impression Share specifically focuses on how often your ads appeared in search results for relevant keywords. A low search impression share could indicate issues with your keyword targeting or competition. 

Strategies to Boost Impression Share (Optimize Bids, Refine Keyword Targeting) 

Here’s how to increase your impression share: 

• Optimize Bids: Strategically adjust your bids to ensure your ads are competitive within the auction system. Utilize automated bidding strategies offered by Google Ads to streamline this process. 
• Refine Keyword Targeting: Review your keyword lists and identify any irrelevant or overly broad terms. Consider adding negative keywords to prevent your ads from showing irrelevant searches. Additionally, you might explore adding new, more relevant keywords to expand your reach. 

Eliminating Wasted Spend with Negative Keywords 

Negative keywords are a powerful tool for preventing your ads from showing when people enter search criteria that is not relevant to your business. Imagine you’re advertising a high-end shoe store. You wouldn’t want your ads to appear for searches related to “cheap shoes” or “used shoes.”  Negative keywords allow you to exclude such irrelevant searches, saving you money and ensuring your ads reach the right audience more often. 

Identifying Irrelevant Search Terms 

A core initial step is to identify irrelevant search terms that are triggering your ads. You can do this by reviewing the search terms report within Google Ads. This report reveals the exact search queries that prompted your ads to appear. Look for any terms that are not aligned with your target audience or campaign goals. 

The Magic of Negative Keywords 

By adding these irrelevant search terms as negative keywords, you can prevent your ads from showing them in the future. This helps you eliminate wasted spending and ensures your budget is directed towards users who are genuinely interested in what you have to offer. 

Best Practices for Implementing Negative Keywords 

Here are some best practices for using negative keywords effectively: 

• Start Broad, Refine Gradually: Begin with a broad list of negative keywords and gradually refine it based on your search terms report data. 
• Match Types Matter: Utilize different match types (e.g., broad match negative, phrase match negative) to ensure you’re capturing all irrelevant variations of a search term. 
• Monitor and Update Regularly: Negative keyword lists require ongoing monitoring and maintenance. Regularly review your search terms report and add new negative keywords as needed. 

Taking Control of Your Google Ads Destiny

Running Google Ads campaigns can feel akin to steering a ship on the ocean. You have a destination in mind (conversions, sales, leads), but  gaining successful results requires constant course correction due to the effects of waves, the wind, tides etc. In this analogy, Performance metrics are your compass, providing invaluable data that allows you to course correct and ensure that you are able to optimise your campaigns so they achieve maximum return on investment (ROI).. 

By closely monitoring Quality Score, Impression Share, and wasted spend through negative keywords, you can gain a deeper understanding of your ad campaign’s effectiveness. You can then make data-driven decisions, fine-tune your keyword strategy, craft compelling ad copy, and ensure your landing pages resonate with your target audience. Remember, using Google Ads is a continuous optimisation process.   

The truth is though, a comprehensive data-centric approach extends beyond the metrics covered here. Exploring A/B testing different ad variations, delving into conversion tracking and heat maps to understand user behavior, and staying informed about the latest Google Ads features are just a few more strategies that you can implement in your Google Ad campaigns. The more you delve into the data, the more precisely you can target your ideal audience and achieve your sales and marketing goals. 

Alternatively, if you do not have the time, the resources or the knowledge to run a successful campaign, reach out to us, and we can help you.