How to interpret your PPC report properly
The monthly PPC report. So full of data yet so mysterious in many ways. As a PPC agency in Kent, we send out our fair share of reports – and try to make them as enlightening as possible. But if you are looking at the month’s results from your agency and scratching your head over what the numbers really mean, this is the guide for you.
First and foremost, your results will mean very little without any context, so ensure your report includes at least one graph mapping key metrics such as clicks and impressions month to month. You’ll also need to factor in conditions like seasonality, or even the current economical situation, to gain more understanding of rises and falls in traffic. This understanding will likely come from your inside knowledge of your business, so you can’t always rely on your agency to provide such information. You can, however, ask for a year-on-year graph, to see if trends repeat themselves from one year to the next.
Finally, an industry average is an important tool in understanding your results. Ask your agency to include the industry average for click through and conversion rates, so you can see how your campaigns are performing in the context of the sector as a whole.
Click through rate (CTR)
Now onto a couple of the key metrics. Click through rate is a good indicator of how enticing your ads are and how well they communicate your message to your audience. If your impressions are high but clicks are low (low CTR), you may want to rethink your campaigns a little. For reference, any campaigns with a CTR of below 2-3% may need a refresh.
If, however, your ratio of clicks to impressions is high, don’t tamper too much with keywords and ad text, as your ads are doing their job and enticing searchers in.
The conversion rate refers to the success of the overall user experience – did they make a purchase, for example, once they got through to your site? The higher the conversion rate, the better you are at getting them to complete the journey.
The conversion rate is often a reflection not of the ads or keywords being targeted, but of the ability of the website to cater to the needs of the customers. Low rates can therefore indicate a need to revise landing pages or improve the overall user journey. You can use data from Google Analytics here to see where customers are dropping out and start testing different solutions.
Cost per acquisition (CPA)
Cost per acquisition tells you how much you’ve spent – on average – in that particular month to gain the sale or conversion you wanted. The lower the CPA, the more efficient your campaign is. Again, some context is needed to better understand this figure. What is the value of your conversion(s) for this campaign? If the CPA is £55 but the value of the sale is £600, the campaign is doing a fair job. If the cost is £55 but the value of the sale is £60, there’s some serious work to be done.