Knowing which metrics matter most when evaluating your paid ads is essential to achieving your objectives.
Here are the five most critical metrics of every Google Ads campaign:
- Ad Spend: Total dollars spent in a given timeframe
- Impressions: The number of times your ad is shown
- Clicks: The number of times someone clicks your ad
- Conversions: The number of lead-generating actions taken
- Cost per Conversion: How much you paid for each conversion
Below, we take a closer look at the significance of each one.
Executive Summary
- When evaluating Google Ads, focus on the metrics that tell the story of campaign performance: spend, impressions, clicks, conversions, and cost per conversion.
- Ad spend establishes your baseline performance.
- Impressions tell you how many times someone saw your ad.
- Clicks tell you how engaging your ads are. Steady increases are good. Watch out for spikes or drops.
- Conversions measure your ad’s ability to earn leads.
- Cost per conversion tells you how much you’re paying for an individual conversion action, like a phone call or form-fill.
Table of Contents
1. Ad Spend
Your ad spend establishes baseline performance. If the ad spend is consistent but performance declines, that’s a signal to check competitors to see if they’ve increased their budget. If competitors haven’t increased their budget, look into recent Google updates to see what’s going on.
- PRO TIP: Working with paid ads specialists like the team at Senior Living SMART can be a huge help when figuring out why performance has declined, even if your ad spend has been consistent.
2. Impressions
Impressions is a term you’ve likely heard a lot. In a nutshell, impressions show how many times people saw your ad.
Impressions can spike when new campaigns launch as Google Ads self-optimizes for delivery. In the long run, impressions should align strongly with your budget:
- Budget increases should yield more impressions.
- Budget decreases should yield fewer impressions.
If impressions change and you don’t know why, check competitor activity in auction insights and search volume via the Google Ads keyword tool to evaluate changes in your market.
3. Clicks
Clicks show how engaged people are with your ads. They usually increase steadily rather than spiking or bottoming out, since Google should get more adept at engaging the right prospect based on conversion data over time.
That said, spikes in clicks can happen, typically from major campaign changes, such as adding new geotargeting territory or significantly changing budget.
Changes in click activity happen naturally over time through market shifts and seasonality. A/B testing one ad against another is a strong way to maintain overall clicks through changing circumstances.
When impressions go up and clicks go up, metrics suggest you’re reaching an appropriate audience. When impressions go down and clicks go up, it suggests you’re engaging a smaller audience more effectively. And when impressions go down and clicks go down, there has likely been a change in your market.
4. Conversions
Conversions measure the leads an ad has earned. They should increase steadily over time, but keep in mind that changes in seasonality and competition can cause spikes.
If conversions are down and clicks are steady, something may be wrong with your landing page. Create an A/B test to change items (ideally make one change at a time), like the location of the form, the headline, or even the color of the button someone clicks. You’d be surprised at how one small change can make a huge difference.
If conversions go up and clicks go down, it suggests you’re engaging a smaller, more qualified group of prospects. They may not click as often, but those who do click are more likely to become leads.
If conversions suddenly spike extremely high (+100%), check with your sales team about lead quality. The sudden spike could suggest that you’re attracting spam.
5. Cost per Conversion
Cost per conversion measures an ad’s efficiency in earning form submissions, phone calls, and other lead-generating actions. You might also hear this called cost per action or acquisition—or CPA.
Cost per conversion should stay consistent month to month, but it may trend up or down over longer periods. If your cost per conversion goes down, it’s often because you’re getting more leads without a change in budget. If your cost per conversion goes up, check competitive metrics like auction insights to see if you’re getting beaten by competitors too often.
Here are some good rules of thumb to keep in mind:
- If you have chat engagements or page views listed as conversions in Google Ads, your cost per conversion won’t reflect your true cost of earning leads.
- Markets aren’t infinite, which means cost per conversion can change easily with seasonality. Plan your campaigns and spend accordingly.
- If your cost per conversion in senior living is below $40 in Google Ads, keep a very close eye on lead quality and sales team feedback.
Need Help Making Sense of Your Google Ads?
Our paid ads team lives, eats, and breathes Google Ads, and they have a deep understanding of the senior living industry. Get in touch and let’s talk about Google Ads and what we can do to improve results.
