Pay Per Click KPIs
When running a pay-per-click advertising campaign, its important to know what you're going to look at to determine if the campaign is successful or if it's not a good use of resources.
There are several KPIs, Key Performance Indicators, you can look at. Here is a look at the three main conversion-based KPIs that can be used to measure performance.
- Cost Per Acquisition/Action: Total cost to generate one sale
- Cost Per Lead: Total cost to generate one lead
- Cost Per Registration: Total cost to generate on registration
For e-commerce, PPC managers are typically looking at CPA. If they're spending less to make a sale than they are earning from that sale, the PPC manager is doing things the right way. The goal then for the PPC manager is to increase the margin between ad spend and revenue even more.
Lead generation PPC campaigns can be a little more difficult to measure. Generating leads from a website often begins with simply filling out a contact form. The more detailed the form, the fewer submissions you'll tend to receive. If you have a less detailed form, you may get more submissions but not as many of them will become warm leads. The client and the PPC manager have to work together to determine what's more valuable, more low-cost cold leads or fewer, high cost warm leads. Then the PPC manager can adjust their strategy based on what leads the client prefers.
When measuring CPR, its important for PPC managers to know how registrations will benefit their client. If the goal of a campaign is to generate site registrations, there must be more value provided to users after they are persuaded to register. If that value is not communicated, uses may register but never come back to the site because they don't feel a need to. Similar to determining the difference between warm and cold leads, PPC managers and their clients need to determine which is more valuable, a high number of inactive registered users or a lower number of highly active registered users.
Having clear conversions in place for PPC campaigns gives the PPC manager something to aim for but without feedback from the client on what is happening after the conversion, the PPC manager can only do so much to run the campaign as effectively as possible.