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Nobody should set out to launch a PPC campaign without knowing exactly what the campaign’s goals are going to be.
Ultimately, the idea should always be to make back more money than you spent, right? But which metrics actually help you ensure you’re on the right track?
We’re all worried about typical measures like total spend, number of clicks, number of sessions, and cost-per-click. These are obviously important metrics, but they don’t tell the whole story.
The campaigns we routinely run for our clients are focused on sales, or leads that can turn into customers. In support of these objectives, it’s important to define a quantifiable goal for your PPC campaign (such as getting 50 new leads or earning £10,000 in new sales).
With a set goal, we can measure every stage of the campaign and uncover any problem areas to optimise. Let’s avoid vanity metrics and focus on three must-know metrics that can dramatically improve your PPC performance for future campaigns.
PPC Performance Metric #1: Persona Conversion Rate
Let’s say you have an overall conversion rate of 3% on your PPC campaign so far. That’s great! But you’re likely reaching a broad audience of people with your campaign – can you accurately describe the conversions for your campaign’s ideal buyer persona(s)?
It’s crucial to have individualised persona conversion numbers, because it allows you to focus your ad spend and messaging toward the most receptive audience. As you create multiple ad sets, you can peg them to different personas and track the conversions for each one.
Personas are a key part of the testing process, serving as the entry point for your sales funnel. This is the best time to see how different audiences respond to your messaging and creative. For example, say a financial SaaS company is targeting two personas: the solopreneur and the chief financial officer at a mid-sized company. These two audience segments are quite different, which could result in a major difference in conversions between them.
Regardless of what you choose to do with the information, it’s incredibly helpful to know that there’s a 2% conversion for the CFO audience versus a 4.5% conversion for the solopreneur. Maybe there’s a lower conversion for the CFO audience, but they spend 10 times as much as the solopreneur.
Compared to having only a general conversion rate for your PPC campaign, segmenting your audiences and their conversions this way will help you make informed decisions about what’s really working.
PPC Performance Metric #2: Landing Page Bounce Rate
It’s one thing to see how your PPC ads are performing – it’s another to see how your landing pages perform once new leads start arriving.
We’ve found that the bounce rate on your landing page or series of pages is an indispensable metric to track. Not only is this helpful to pinpoint problem spots in your campaign, but it also directly affects your quality score. Simply put, a high bounce rate on your landing page is a red flag that users don’t like your ads for some reason, and your PPC campaign may suffer as a result.
Google Analytics is a great way to directly measure your bounces, including by traffic source. Landing page software like ClickFunnels, Unbounce, Instapage, or LeadPages can also measure your bounces and conversions, if you choose to go that route for your landing pages.
As you continue testing and tweaking your campaign, the landing page bounce rate should give you a clear sense of how well your page is resonating with visitors. Some users may ditch it because it wasn’t what they expected – in that case, you may need to better align the messaging and design of your ads with your landing pages. This is especially true if your ad promises them something of value, like a free trial or a discount on a product, and they don’t see it after clicking through.
If you have a multi-step sequence, you should be able to see exactly where most users drop off from page to page. Do you have a call to action that’s failing to perform? Are users refusing to fill out an overly complicated form? Are there too many possible actions on the same page?
The bounce rate is a great way to uncover what needs improvement on your landing pages, which will lift your PPC performance and improve campaign profitability.
PPC Performance Metric #3: Cost Per Acquisition
Smart marketers will identify a specific return on ad spend (ROAS) for any PPC campaign in order to justify what they’re spending. But you can’t really know what this number is until after the campaign is over.
That’s why the next best thing is tracking the cost-per-acquisition (CPA) along the way. The CPA tells you exactly how much it’s costing to capture a lead, subscriber, or customer.
How do you find out the CPA? Depending on the campaign, you could:
- Use built-in data from the PPC campaign dashboard (provided within Google Ads or Facebook Ads, for example)
- Utilize link codes with UTM parameters
- Deploy landing page software with analytics or connect your landing pages to Google Analytics
- Monitor sign-ups and purchases through your CRM
- Establish a form field on your contact forms to ask customers how they found you
Some combination of these techniques will help you measure how many leads or customers you’re getting from a particular campaign. Then, you can divide this number into how much you’re spending to determine an accurate cost per acquisition metric. For example, if you’ve spent £1200 and closed 30 leads in your PPC campaign, your CPA would be £40.
But this brings up another question: What should your ideal CPA be? Unfortunately, there’s no universal CPA to compare yours to, as it varies significantly by industry and campaign – but one important consideration is the average lifetime value of a customer (CLV). As a rule of thumb, you should ensure that your CPA is lower than the average CLV, or else you’ll be on track to lose money with the campaign.
In concert with the persona conversion rate and the bounce rate, the CPA metric is a financial metric that paints a picture of the campaign’s revenue impact. By pulling some of these other levers, you should be able to lower your CPA – which means a more profitable campaign!
PPC Performance Wrap-Up
In the end, nothing is more important to a PPC campaign than the metric of profit or return on investment. But these are lagging indicators that tell you how well a campaign performed after it’s already over – and that information comes too late to help steer the ship.
That’s why you need to track other metrics – leading indicators – that will help lead you to profitability. Persona conversion rate, landing page bounce rate, and cost per acquisition each give you invaluable data to optimise your campaign along the way.
Here at Common Ground, we’ve managed hundreds of successful PPC campaigns with metrics like these. It’s not easy to handle the technical and creative aspects of a PPC campaign on your own. Let an expert PPC agency help you reach your PPC performance goals this year!