It’s no secret that common SEM metrics shape and inform digital marketing campaigns. We all understand CTR, conversions, and so on, but do marketers and agencies really understand the incredible narratives these metrics can tell us when combined? Maybe you do, maybe you don’t – but in the interest of fair competition, let’s all get on the same page.
After activating a search campaign, reviewing the data will help get you an idea of what is working and what isn’t. Here is what to look at when assessing the performance of your ads:
Click-Through Rate (CTR) & Conversion Rate
To get a general idea of campaign performance, these two metrics should be paired together. In an ideal world, CTR and conversion rate will both be high, signifying that you have a quality, and highly relevant landing page, copy, and targeting. But what can you learn when one or both of these metrics are lagging? Let’s look at a few scenarios...
NOTE: To gain perspective on your metrics as they relate to performance, compare your own YOY data or industry benchmarks
High CTR & Low Conversion Rate
If you have encountered this, it could be an issue with your ad copy. While seeing a high CTR generally means your copy is speaking to your audience, it may not match the landing page’s objective.
If a user clicks your ad because it sparks their interest and then navigates to a landing page that isn’t relevant, chances are you just got yourself an unqualified click and wasted some of your ad budget.
On the flip side, it is possible your landing page is doing a poor job of closing the sale or is providing a difficult experience that doesn’t accommodate a conversion. The ads may be clearly speaking to the end goal of the user, but it is possible your landing page isn’t. In this case, conversion rate optimization is a must.
Aside from copy, there could be another issue leading to high CTR and low conversions: targeting.
Imagine you have really compelling ad copy that could speak to many people, but is meant to really only speak to a small, select group. Seeing this ad could lead people to click without fully comprehending this ad is not relevant to them.
For example, if you are running an ad for an adult learning program, but are targeting 18-40 year old audience on the younger side of your spectrum are going to realize this program is irrelevant to them once they get to the landing page. Even by including the term “adult learning” in your ad, there is no guarantee they won’t skim the ad and before clicking.
By being selective with your targeting, you can ensure the people that click your ads are the same ones you expect to convert.
Low CTR & High Conversion Rate
In an instance where you run into a low CTR and high conversion rate, it is likely related to your ad copy not being compelling enough. Troubleshoot your copy by asking yourself these questions:
- Is my ad using too much jargon or targeting too specific of an audience?
- Are my competitors presenting more compelling benefits or differentiators?
- Do I have a weak call to action? Can I instill urgency in my copy through emotional triggers?
Having a high conversion rate usually means your landing page is doing an excellent job of closing the sale so by editing your ad copy to be more effective, you can get more clicks and conversions.
It is also important to note that if your ad has a low CTR, it can lead to your ads having a low-quality score, which will negatively impact your campaigns’ cost effectiveness.
A low-quality score impacts the placement of your ad, meaning its shown on fewer searches or buried under similar ads with higher Quality Scores. Three main factors impact Quality Score:
- Ad Relevance: How well your keywords match your ad copy
- Landing Page Relevance: The user experience and keyword relevancy of your landing page
- Expected CTR: How likely your ad will get clicked based on historical keyword performance
Low CTR & Low Conversion Rate
If you compare your ads to the industry standards and note they are underperforming, it is time to revise your strategy as whole. Start by correcting the issue of low CTR by examining the following:
- Is the copy compelling and relevant enough to generate clicks?
- Are the ads targeted correctly?
- Look into the demographics, location, devices, etc. to ensure your ads are correctly reaching the desired audience
- Adjust your bids so you have more budget allocated to the top conversion channels
- Complete additional keyword research to determine if you are missing out on keywords with high CTRs
- Be sure to include those keywords in your copy!
After optimizing your ads to address your low CTR, monitor their performance and then reassess. If you have increased your CTR, but still are not getting conversions, there is most likely a disconnect between your ad copy and landing page.
Cost Per Conversion
If you were stranded on a desert island and could only bring one SEM metric with you, it should be the cost per conversion.
Remember: The purpose of your ads is to inspire the audience to take an action that is profitable to your business.
By looking at cost per conversion, you can determine if your ad is driving conversions at a cost that is lower than your average profit from a new customer, thus driving a positive return on investment for your business.
This type of performance tracking is not available in traditional advertising, so take advantage of it and utilize the data to optimize your advertising, whether that means pausing the underperformers or allocating more budget to the overachievers. After all, if you are going to invest in digital marketing, ROI is what really matters at the end of the day.
View-Through & Assisted Conversions
There are a couple caveats to conversions that are worth mentioning. A typical conversion according to AdWords is what happens when a user clicks on your ad and converts on the landing page, whether that is adding an item to their cart, submitting a request for more information, clicking a call extension, etc.
However, what if this is not the path taken by a user, but they still convert?
A view-through conversion occurs when a user sees your ad, does not click, but later directly visits your site or finds it organically and converts. In this case, it is probable that your ad played a part in inspiring action even if it was not directly what was used to get there.
Hopefully, this story can clear up this idea: Jenny sees an ad for shoes but has to rush to catch a train, so she notes the company's name for future reference, but doesn’t click on the ad. Once on the train, she goes directly to the website where she finds the shoes she saw on your ad and purchases them. The original ad served to Jenny receives a view-through conversion for the sale.
Assisted conversions are interactions with your website that lead to a conversion, but are not directly, or fully responsible for the conversion. For example, imagine Jenny clicks on your ad, learns about your shoes and then leaves. Later, she searches for your site organically and ends up buying those shoes. The first click on your ad would count as an assisted conversion.
These types of conversions should not be overlooked when reporting as they play a part in the final value associated with the campaign.
While testing your copy is not a metric, you can use the metrics we discussed to influence your copy and ensure you are putting the most relevant and compelling copy in front of your audience.
By running A/B versions of your ad copy, you allow yourself the opportunity to observe what type of messaging resonates with your audience. Here are some ideas for A/B testing:
Switch up your benefits and unique selling propositions
- Does affordability mean more to your customers than quality?
- Does free shipping mean more than a lifetime warranty?
Creative vs. straightforward messaging
- Run one ad of each and look at the data. What is getting more traction?
New CTAs and CTA placement
- Is “Apply Now” getting more clicks than “Learn More”? Is placing a CTA in your headline performing better than placing it in the description?
Is your Quality Score low? Make better use of your keywords.
- Your ads might be shown less due to a low-quality score. Mitigate this by adding some more keywords from your ad group to the copy or display URL.
NOTE: As mentioned earlier, your landing page will also impact your quality score. Ensure that it mirrors the objectives of your campaign.
At the end of the day, it is important to take a step back and look holistically at your campaigns. One single metric is not going to provide you all the information you need, and in fact can be very misleading. Aggregating your results and making informed decisions is key to future success.
Test, learn, and adapt. Luckily, as digital marketers, this has never been easier!
What is something you noticed about A/B testing your ads? Did you receive the results you expected or did it surprise you? Let's discuss below!