Look, we’ve all been there. You pour your heart and soul into creating killer PPC ads, but deciphering the data to see if they’re actually working? That’s a whole other story.
But here’s the good news: You don’t have to be a math whiz to master PPC metrics. In fact, by understanding just a handful of key ones, you can dramatically improve your ad performance.
So here’s the thing.
We’ll break down the most important PPC metrics into bite-sized pieces, explain why they matter in plain English, and–the best part–offer actionable pro-tips to make each one sing.
Along the way, we’ll even point you toward some handy tools to make PPC campaign performance audits easier.
We will start from the basic PPC metrics everyone should know and build our way up to the advanced ones.
5 Basic PPC Metrics To Track Plus Expert Tips to Improve
1: Quality Score
While other marketing experts would start with some more basic PPC metrics like ‘Clicks’ and ‘Impressions, ‘ we would start by defining quality score first.
Why?
Because how well your ad is going to perform in real-time begins well before you have launched your campaign, and quality score gives you enough foresight into your PPC campaign performance.
The higher your quality score, the better your ad will perform and the lower cost-per-click (CPC) you will have to pay (more on this later).
So, the quality score measured on a scale from 1-10 (lowest to highest) is a ranking assigned by Google Ads[1] (and other platforms have similar metrics) that reflects how relevant your ads, keywords, and landing pages are to users’ search queries.
It is mainly calculated via three things[9]:
- Expected clickthrough rate (CTR): How likely that your ad will be clicked when shown?
- Ad relevance: How closely does your ad match the user search intent?
- Landing page experience: How relevant and useful your landing page and its design is to people who click your ad.
Why is Quality Score Important?
A low-quality score (5 or less) can significantly hinder your campaign’s performance. It might mean your ads are not relevant to what users are searching for, leading to wasted ad spend and missed opportunities.
Here’s how to improve it.
Pro Tip: To improve your quality score, focus on creating relevant ad copy that closely aligns with your keywords. Ensure your landing page delivers a positive user experience that is consistent with your ad’s message. Consider using a mix of broad match, long-tail, and geo-targeted keywords to reach the right audience. Always use Google’s Quality Score Diagnostic tool.
2: Cost-per-Click (CPC)
Now that you have created your ad and it’s ready to be advertised, you will likely set an estimated budget for every click you get. That’s what CPC is.
CPC is a critical metric calculated by dividing your total cost by the number of clicks you receive or will receive. It reveals the average amount you pay each time someone clicks on your ad.
The formula to calculate CPC is,
Your PPC specialist will have an idea of the CPC before you start your PPC campaign. Tools like Ubersuggest and SEMRush can provide you with up-to-date CPC data for any keyword you are targeting.
How to Lower Your CPC?
Remember when we talked about how quality score affects CPC a lot? Yes, that’s how you lower your CPC. Here is a bar chart to help you understand.
CPC allows you to compare the cost of acquiring clicks across different campaigns, ad groups, and keywords. A high CPC might indicate an overly competitive niche or room for keyword optimization.
Here is a quick tip to bring your CPC down.
Pro Tip: Aim for a quality score between 7-9 for highly competitive commercial keywords[2]. Prioritize quality keywords with a proven track record of generating relevant clicks and conversions. Refine your negative keyword list to prevent irrelevant searches from triggering your ads and inflating your CPC. Explore location targeting to focus your campaigns on areas with lower average CPCs. To take your campaigns to the next level, consider working with a specialized Google Ads agency that can help optimize your strategies for better results.
3: Impressions
Your ad is being shown to everyone, and you are getting impressions.
Impressions measure how many times your ad appeared on a search engine results page (SERP) or other placements within the display network. It’s a raw indicator of your ad’s visibility.
Is High Impression Rate a Good Thing?
Not necessarily.
A higher number of impressions signifies greater brand awareness and the potential for more clicks and conversions. However, just because your ad is seen doesn’t necessarily mean it’s reaching the right audience or being clicked on as well.
Also, if you use a Cost-per-Mile (CPM) bidding strategy, a higher number of impressions with a low number of clicks will only add to your ad spend. We will discuss CPM in the miscellaneous PPC metrics.
For now, here’s a tip to ensure your ad gets clicked when viewed.
Pro Tip: Use audience targeting features to ensure your ad is shown to users actively searching for your products or services. Utilize tools like Google Ads Audience Insights to gain a deeper understanding of your target audience and tailor your campaigns accordingly.
4: Clicks
After impressions come clicks.
Clicks represent the number of times users clicked on your ad after it was displayed. A higher click volume indicates user interest in your offering.
More Clicks Mean Your Ad is Good Enough
Clicks are a crucial step in the conversion funnel, as they move users from simply seeing your ad to engaging with your website or landing page. However, be mindful of accidental clicks that inflate your numbers but don’t translate to actual conversions.
Pro Tip: Focus on producing clear, compelling ad copy that speaks directly to your target audience’s needs, desires, and pain points. A/B test different headlines and descriptions to identify what resonates most with your audience and drives higher click-through rates (CTRs).
5: Click-Through Rate (CTR)
CTR, calculated by dividing clicks by impressions and expressed as a percentage, measures the effectiveness of your ad in prompting users to click. A strong CTR suggests your ad resonates with your target audience and compels them to take action.
The formula to calculate CTR is,
Focus on Maintaining a Good CTR
CTR is a key indicator of ad relevance and user interest. A consistently low CTR might signal a need to refine your ad copy, targeting, or landing page experience.
Pro Tip: Go beyond generic keywords and incorporate long-tail keywords with higher conversion intent. Use ad extensions like sitelinks and callouts[3] to provide users with more information and increase ad real estate. Consider tools like Google Ads Quality Score to diagnose potential issues with your ad and improve its relevance. Also, try Facebook and LinkedIn ads to see which has the best CTR.
And if it’s LinkedIn Ads you are using, consider watching our recent video on “Acquiring B2B Customers via LinkedIn Ads’ to run them like a pro!
4 Advanced Conversion-focused PPC Metrics and How to Improve Them
Now that we are done defining the basics, it’s time to understand advanced PPC metrics that directly tell you how much money it took to convert your customers and everything afterwards.
6: Cost
Cost refers to the total amount you’ve spent on your PPC campaign. It encompasses all charges incurred, including clicks, impressions, and conversions, depending on your bidding strategy.
How to Lower Your Total Ad Cost?
- Pause Low-Performing Keywords: Identify keywords with minimal conversions and pause them to free up the budget for high-performing ones.
- Invest in High-Converting Keywords: Analyze “Search terms” data to discover long-tail keywords driving conversions and add them to your campaigns.
- Analyze Negative Keywords: Block irrelevant searches by adding negative keywords that exclude users unlikely to convert.
- Optimize Ad Scheduling: Analyze conversion data by time to identify peak periods and adjust ad scheduling for maximum impact.
- Design Compelling Landing Pages: Ensure your landing pages align with your ads and guide users toward conversion actions.
Additionally, you should also consider this:
Pro Tip: Utilize automated bidding strategies offered by PPC platforms, like Target CPA or Target ROAS, to automate bids based on your desired cost goals. Regularly review your campaign settings and adjust bids as needed to optimize spend efficiency. Make use of cost-tracking tools within PPC platforms to gain granular insights into your budget allocation.
7: Conversion Rate
The conversion rate is the percentage of visitors who take a desired action (purchase, sign up, download, fill out the form, make a phone call, etc.) after clicking on your ad. It directly ties to your campaign goals and reflects how effective your ad and landing page are in driving conversions.
High Conversion Rates Equals PPC Campaign Success
Conversion rate is the ultimate PPC metric to track for success for most PPC campaigns. A high conversion rate signifies that your campaigns are attracting the right audience, your ad copy is compelling, and your landing page effectively guides users toward taking action.
Here is a tip to increase your conversion rates.
Pro Tip: Ensure your landing page aligns seamlessly with your ad copy. Use clear calls to action (CTAs) that tell users exactly what you want them to do. A/B test different landing page elements like headlines, visuals, and CTA buttons to optimize for conversions. Implement conversion tracking to measure the effectiveness of your landing pages and identify areas for improvement.
8: Cost-per-Acquisition (CPA)
This is a PPC metric that the executive body is usually interested in as it tells how much money it took them to convert each customer.
CPA is a crucial metric that is calculated by dividing your total cost by the number of conversions you achieve. It represents the average cost of acquiring a new customer or lead through your PPC campaigns.
The formula to calculate CPA is,
CPA Helps in Calculating Your Profits
Understanding your CPA allows you to assess the profitability of your campaigns. A low CPA indicates you’re acquiring customers or leads at a cost that aligns with your business goals. Conversely, a high CPA might necessitate adjustments to your bidding strategy, targeting, or ad creatives.
Pro Tip: Set target CPAs for your campaigns based on your customer lifetime value (CLTV) and desired profit margins. Utilize conversion tracking data to identify high-performing keywords and ad groups that generate conversions at a lower cost. Consider using automated bidding strategies like ‘Target CPA’ to optimize bids and keep your acquisition costs under control.
9: Return on Ad Spend (ROAS)
While CPA tells you how much money it took to convert your customer, ROAS tells you the profit you made when converting each.
This metric provides the PPC campaign’s profitability by calculating the total conversion value divided by your total ad spend. A high ROAS indicates your campaigns are generating a positive return on investment.
The formula to calculate ROAS is,
Pro Tip: Set target ROAS goals based on your business objectives. Track ROAS across different campaigns, ad groups, and keywords to identify the most profitable areas and optimize your budget allocation accordingly. Once again, use conversion tracking to assign values to different types of conversions (e.g., sign-ups vs. purchases) for a more comprehensive understanding of your ROAS.
6 Miscellaneous PPC Metrics for Deeper Insights
As you gain experience managing PPC campaigns, consider incorporating these advanced PPC metrics for even more granular analysis and optimization wherever you can.
10: Average Position
This PPC metric is specifically for search engine ads like Google and Microsoft. Even the sponsored ad section above the organic listing in the SERPs is competitive, and you can get any of the four positions. It mostly depends on your quality score, bidding cost, and the relative competition for the keyword.
Average position reveals exactly that – the average ranking of your ad across all placements for a given keyword or campaign.
Does Having a Higher Average Position Matter?
Absolutely! A higher average position means your ad is more visible, increasing the chances of users noticing and clicking on it. In fact, the average CTR falls from 2.1% to 1.2% from Ad position 1 to position 4[4].
Here is a table showing the precise value per ad position (source: First Page Sage):
Just because you are in the sponsored section doesn’t mean users will go to the fourth ad to click it. So, how do you push it to the first position?
Pro Tip: Refine your keyword targeting and optimize your Quality Score (more on that later!) to improve your ad rank. Consider experimenting with different bidding strategies, like “Target Impression Share,” to ensure your ad appears in more prominent positions.
11: Impression Share
We talked about targeting ‘impression share’ for a higher average ad position, but what exactly is it?
This metric reveals the percentage of times your ad appeared on a SERP compared to the total possible impressions you could have received. It simply means not being in the top 4 ad positions wherever your ad could have been.
A low impression share might indicate a need to adjust your bids or refine your keyword targeting to increase visibility. Here is how you can do that.
Pro Tip: Analyze search terms reports within your PPC platform to identify relevant searches where your ad isn’t showing and consider expanding your keyword strategy accordingly.
12: Viewable Impressions
Not all ad impressions are viewed equally.
Viewable impressions specifically measure the number of times your ad was actually seen by users on a web page or app, as opposed to simply being loaded in the background and not scrolled onto.
Create Ads that Hook Readers For More Than 1 Second
Focusing on viewable impressions helps you understand how many users have a genuine chance of seeing and interacting with your ad. If you are getting more ‘viewable impressions’ than just simple ‘impressions,’ this means that more than 50% of it was viewed for at least 1 second[5].
However, the best ad campaigns typically have a viewability rate of 70% and above[6].
Here is a quick tip to improve your ad viewability above this threshold.
Pro Tip: Hook readers with a headline that highlights their pain points or an image that says it out loud. Plus, utilize tools like Google Ads Viewability Optimizer to ensure your ads are displayed in high-traffic, high-visibility placements where they’re more likely to be seen by potential customers.
13: View-through Conversions
Sometimes, your customers convert behind the scenes, and this PPC metric checks on that.
View-through conversions track conversions that occur after a user sees your ad but clicks on a different ad, an organic search result, or simply spends anywhere between 24 hours up to 90 days before converting[7].
View-through Conversions Matter During Brand Awareness Campaigns
View-through conversions offer valuable insights into the overall impact of your ad campaign, even if they don’t directly capture the click.
Pro Tip: Enable view-through conversion tracking within your PPC platform to gain a more holistic view of your campaign’s effectiveness. Analyze view-through conversions alongside click-through conversions to understand your ad’s influence and your brand awareness campaigns on the user journey.
14: Average CPM
CPM (cost-per-thousand impressions) is a PPM (pay-per-mile) metric that reveals the average cost you incur for every thousand times your ad is displayed on a website or app.
Cost-per-Mile is a PPC Metric for Bigger Ad Campaigns
Understanding your average CPM allows you to assess the efficiency of your display advertising efforts and identify areas for cost optimization.
Pro Tip: Use audience targeting features to ensure your ads are shown to users most likely to be interested in your offering, say window replacement ad during the hurricane season in the U.S. Experiment with different ad placements, sizes, and formats to find the combinations that generate the most impressions at a cost-effective rate.
15: Average CPV
For video advertising campaigns, CPV (cost-per-view) is important. This PPC metric represents the average cost you pay each time someone views your video ad for 30 seconds or more[8].
Focus on Having More Video Impressions with Lower CPV
A low average CPV indicates you’re reaching your target audience with your video ads at a cost-effective rate.
Here is a quick tip specifically on creating a compelling video ad – it will automatically have a lower CPV when targeted to the right audience.
Pro Tip: Create high-quality, engaging video ads that capture viewers’ attention and encourage them to watch through to completion. Utilize in-stream targeting options to ensure your video ads are shown before relevant content. Use a combination of still images, carousels, slideshows, collections, and playables to see what is being converted with a lower CPV. Add ‘Shop Now’ links so viewers can purchase the product right from your video advertisement without directing them to your online store.
Here are two examples of ads that have high viewability and conversion rates.
So, you have your 15 PPC metrics explained in plain English, but the pro tips for improving them come from experts. Want something even better? How about a guide to PPC Audit that makes you a pro at the PPC game?
Just remember the most important PPC metrics for your campaigns will depend on your specific goals. Focus on the metrics that directly tie to your desired outcomes, whether it’s maximizing sales, generating leads, or boosting brand awareness.
Feeling something is still left? We thought so, too. Here is our last gift for you: How to Win Clients With PPC?
The Takeaway—Everything Boils Down to Your Ad and PPC Specialist
We have walked you through 15 PPC metrics that are essential for any ad campaign.
But no matter how deeply you understand these metrics, in the end, your ad campaign’s success hinges on two things.
First, how well was your ad created – be it text-based, still images, videos, or a combination? Second, how apt your PPC specialist and team is at not only tracking but reacting proactively to the PPC metric trend you get.
If you want a truly high-performing PPC campaign, then hiring these experts becomes a must.
You already have them? Good.
If you don’t, then consider a PPC agency that gets qualified leads.
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FAQ
PPC stands for Pay-Per-Click. It’s a type of online advertising where you only pay when someone clicks on your ad.
A PPC metric is a measurable value that helps you understand how your PPC campaign is performing. It’s like a scorecard that tracks things like clicks, impressions, conversions, and costs.
There’s no one-size-fits-all “good” PPC rate. It depends on your industry, goals, and budget. However, a healthy return on ad spend (ROAS) is a strong indicator of PPC campaign success.
Number of clicks, click-through-rate (CTR), cost-per-click (CPC), conversion rate, cost-per-acquisition (CPA), and return on ad spend (ROAS) are the six most important PPC metrics you should always track.
References
- About Quality Score – Google Ads Help[1]
- What Is Google Ads Quality Score, Really? (tenscores.com)[2]
- Google Click-Through Rates (CTRs) by Ranking Position in 2024 – First Page Sage[3]
- Google Click-Through Rates (CTRs) by Ranking Position in 2024 – First Page Sage[4]
- What is a viewable impression? – Optimizely[5]
- Viewability – Definition, measurement, and tips | Amazon Ads[6]
- Find out how long it takes for your customers to convert – Google Ads Help[7]
- What is Cost per view (CPV) and how to calculate it | DashThis[8]
- About Quality Score – Google Ads Help[9]