Evaluate Your Ad Performance with Top 3 KPIs for Google Ads

Sep 12, 2022 4 min read
Top 3 KPIs to ensure better performance and reach more customers
Top 3 KPIs to ensure better performance and reach more customers

Advertisers use Google Ads to reach more potential customers - starting off by trying to set up the right account/campaign strategy and get better performance & results from advertisements.

However, it will never be enough just to set up the account the right way since persistence plays a role just as important in your success. To ensure persistence, you should track data regularly and optimize your ads according to KPIs.

Google Ads shares data in a very detailed way. That’s why you may encounter too many metrics in your campaign tables, each containing a different data set. Thus, you can evaluate your campaigns, content, keywords, and texts from different points.

Yet, you need to master some metrics for efficient & fruitful ad account management.

Now, let's take a look at the most important metrics for Google Ads accounts.

Search Impression Share (IS)

The number of times your ads are shown to your potential customers is crucial. As users can’t click an ad unless they see it, impressions are the first interaction to reach your potential customers. In other words, you should try to increase the number of impressions to improve the traffic and conversions.

You can control your total ad impressions from the impression metric. What about the others, though? Well, Google Ads estimates the appropriate impressions your ads may receive using many factors (quality scores, bidding, targeting, etc.). So, comparing the rate of impressions your ads can receive with the total eligible impressions provides useful information for your optimizations. To make this comparison, all you have to do is take a look at the "search impression share" metric.

Search impression share = received impressions /total number of impressions your ads may receive

You can easily make this comparison for campaigns, ad groups, product groups, and keywords. In line with these comparison data, you can take action to reduce your lost impression share rates.

There are 2 main reasons as to why you might be losing impressions:

  • Ranks of your ads
  • Daily budget

Google Ads has benchmark metrics for both; "Search lost IS (rank)" and "Search lost IS (budget)". Having low ad rankings or an insufficient daily budget will increase your lost impression share. To overcome this and get more impressions, you need to take action. Here is what you can do:

To improve your rankings, you need to increase your quality points or bids.

Ad rank = Quality score (QS) x Bid

A quality score is a number from 1-10 that includes a combination of metrics such as clickthrough rate (CTR), ad relevance, and landing page experience. To increase the QS, improvements should be made in these metrics that affect the score. Advertisers with high-quality scores may have better ad rankings with lower bids. In other words, by increasing your quality scores, you can both improve your ad rankings and provide a cost advantage.

If you can't change your quality score, you can also improve your ad rank by increasing your bids.

To reduce the Search lost IS (budget) rate, you can increase your daily budget. Let's say your impressions lost due to budget are 30%. It would be wise for you to increase your budget by 30% so you can improve your impression rate.

The size of your target market and the level of competition there play an important role in evaluating your IS. If you are in a large and competitive market, your impression shares cannot be expected to be very high. From this audience segment, it will be enough to reach the appropriate amount of clients for the growth potential of your business.

Click-Through Rate (CTR)

All advertisers aim to get maximum clicks from ad impressions. They use the Clickthrough Rate (CTR) metric to make such assessments, which is the percentage of clicks on ads to impressions. Let’s say your ad gets 100 impressions and 10 clicks, your click-through rate will be 10% in this case. With this metric, you can measure how much site traffic you attract from users that see your ad.

High CTR is everyone's dream, but clicks that don't come from the right audience will only waste your money. For this reason, this is the first point you should pay attention to targeting settings when examining your click-through rates. It is inevitable to get quality site traffic with the right audiences.

CTR = (Clicks / Impressions) x 100

If you're sure you're targeting the right audience, it may be helpful to make changes to your ad content to increase CTR. Also, advertising texts and images are valuable content that helps you impress users. Here, you should note that insufficient or incorrectly worded ads may lead to low CTR. That’s why it would be helpful to test different ad variations to best convey your brand or products.

CTR values differ depending on the industry, targeting locations, popularity of products, seasonality, and the type of your ad campaign. We recommend that you consider all these factors when making comparisons. Remember that your click-through rates affect your quality scores, and good CTR is key to successful advertising performance.

Conversion Rate

Conversions refer to the significant actions your potential customers take on your website. They are especially important for conversion-oriented campaigns so you can monitor how much of the site traffic generates through ad-clicking. The conversion rate (conv. rate) metric provides this information.

Conversion rate = Conversions/Clicks

You should also take a look at different metrics when evaluating your conversion rates such as impressions, clicks, and landing page experience which should come first. If you don't have enough impressions and clicks, you should take steps to improve your data. If you think your clicks are good but your conversion rates are low, chances are:

  1. Users may be giving up when they come to your site. You can increase your conversion rates by making your landing page more relevant.
  2. Your competitors may offer more reasonable prices for the same product. In this case, you can change your prices. If you're strict about price, we recommend focusing more on shopping ads than search ads. In this way, users will see the price of the product and click if they think it is appropriate. Although this may cause a decrease in the number of your clicks, it can increase your conversion rates in the long run.

The conversion rate may vary depending on your industry, targeting, and campaign type. We would also like to remind you that accurate conversion tracking is very important at this rate. If you haven't done conversion tracking yet or think your conversions are not counted correctly, you can contact our experts for effective & quick solutions.

Last but not least, you can also see this article to find solutions to potential problems stemming from discrepancy between Google Ads conversions and Shopify orders.

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