Google AdWords can be an intimidating advertising platform. Everyone throws out different reasons and suggestions for improving a campaign and if you don’t know what some of the basic vocabulary means then it is impossible to decipher the truth from all the sales pitches. In today’s blog we discuss three commonly used vocab terms for PPC campaigns on Google as well as other PPC platforms.
Click Through Rate (CTR)
Click through rate is a percentage calculation of the number of people who see your ad verses the number of people that click on your ad. This number is something you want to improve over time. If you see CTR of 0.05% on your campaign, then you can be certain that the ads in your campaign do not match search queries that people are typing into Google. The best way to combat a low CTR is to create more refined ad groups. A great rule of thumb is that it is always better to have 100 ad groups that contain 10 keywords, rather than 10 ad groups that contain 100 keywords.
Conversion
The word conversion is basically a marketing term for the successful competition of a goal on your website. There can be multiple conversions, because there are typically many ways that a visitor could successfully “convert” on your website. For example, they could sign up for your newsletter. That would be a goal worth tracking. Other types of conversions might be the visitor completing a sale on your website, or calling a phone number, or filling out a quote form, or filling out a form to download a whitepaper. Keep in mind that a conversion for AdWords is only tracked when someone comes to your website by clicking on one of your ads. All other methods of visitors getting to your website do not trigger conversion tracking through AdWords.
Cost Per Click (CPC)
The amount of money that you pay to put your ad within Google’s paid search results contributes to the cost per click of your ad. Before the click ever happens, you must submit a bid for each keyword you are advertising on Google. When the user clicks on your ad you pay one cent over the advertiser below you. This metric should decrease over time because Google rewards better performing ads by requiring them to pay less money. It’s a complicated formula, so to keep it simple let’s just say that your campaigns should see decreasing CPC figures month after month until your CPC reaches a plateau.
This covers just three commonly used vocabulary terms used frequently in Google AdWords as well as other PPC platforms. In future blogs we will explore more vocabulary terms that often confuse advertisers.