Webinar Wrap-Up: When Good PPC Campaigns Go Bad

How are PPC metrics interrelated?

When dealing with data, the most important thing is finding out the root cause of when something suddenly changes. In order to understand why data changes, a chain of events needs to be understood first. Data usually flows in these three levels:

1. Before the click takes place
2. During the click
3. After the click (when conversion takes place)

Before the click

Always start with the volume of data you’re working with—understand whether it went up or down. This volume can be compared from one-time frame to the other on a year-on-year (YoY) or month over month (MoM) basis.

Then understand your impressions. You usually lose your impressions based on your shared budget or lost impression share (rank). These factors are ultimately influenced by your budget, quality score, bids and so forth.

If volume and impressions share changes, the root causes that you need to start looking at are:

• Targeting:New targets or negative keywords added, match types changed, PPC engines changed rules
• Seasonality:
• Budget: Impression share can be lost due to budget

Lost Impressions share due to budget

Losing impression share can be due to an increase or decrease in the budget. However, losing impression share when the budget remains the same can be due to higher cost per click (CPC). This means that the CPC increased significantly and your budget can only afford a few total CPC.

Lost impressions share (budget) can help project budget changes. It is also useful to look at Impression Share budget trends to see if you have a lot of impressions are coming in.

Lost Impressions Share due to rank

An increase in weighted quality scores can enter you into more auctions and positions and your Lost Impressions Share (Rank) will increase. If Impressions top percentages drop, the ad could fall to page 2 more often and never get displayed. Bid changes can affect affect rank and ultimately position, which can enter or remove you from additional auctions.

During the click

If the impressions and volume haven’t changed that much but there are differences in metrics, then move from impressions to when clicks take place.

Factors influencing click-through rate

Click-through rates (CTR) are determined by impressions and clicks. But it is also influenced by a huge amount of other factors in your account. It can be influenced by:

1. Ads changes - Organization of ads, ads rotation, ads testing or even ad types
2. Impressions changes - Top impressions percentage changes, negative targeting changes, paused targeting and new targeting
3. Budget changes - Budget changes that add/remove impressions to existing words or budget changes that allow additional search terms to show for broader keywords

Factors influencing cost per click

CPC is the most straightforward of all the metrics. It is very stagnant unless your competitors make major changes to bids or quality scores. It is influenced by:

1. Your bids - If you change your bids a lot of times
2. Competitor bids - If your competitors change their bids a lot of times
3. Quality score/Ad rank - If your score went up or down a lot of times

Using auction insights, you will be able to see how the competitors changed their position above your rates. If their top of page rate and position are above you a lot, it means that they raise their bids or quality scores a lot (assuming you haven’t made changes). If you want to maintain your position, you need to change your bids or work on your quality score and add extensions.

Factors influencing cost changes

Cost changes have very few influencing factors as compared to the other metrics. It is simply the number of clicks you get and your average CPC. When there are a lot of cost changes it is because of changes in your clicks and CPC.

After the click (during conversions)

Conversions are a factor of the number of clicks you receive in your conversion rate. The CPC data along with your conversions data tells you how much you pay for a conversion.

What affects your total conversions?

• Clicks - Lower clicks lead to lower conversions
• Conversion rate - Conversion rates can go down if your targeting changes, your website is down, or if your tracking is not working properly etc.

If your conversion rate goes down, your cost per conversion goes up. So if there is a major change in the conversion rate, look at the campaigns or ad groups where it happened, so that you can examine that data and fix it.

Why do you need to dig into all these metrics?

If your CPAs are going up a lot, it's not only because of the increase in click prices. There are a lot of metrics that can affect your conversion rate and return on ad spend (ROAS):

• Ads: Changes in your offers or changes in competitor offers
• Landing pages: Broken URLs or landing page testing/offers
• Conversion data: The rate at which conversion data is applied or conversions occur

Heatmaps can help you quickly see where you get the most impressions and identify outliers. You can also drill into campaigns/ad groups where the data changed. First of all, isolate the campaigns with the biggest changes, then drill down to the ad group with the biggest changes and then look at the overall data analysis at the ad group level. Once you find out the problem, look at the change history. Google logs the changes you make in your account so you can isolate the time frames and see the massive changes.

Once you know in which campaign or ad group the change happened, segment down to the time frame when it happened, then look at what changed in that particular spot. After this, you can start to segment your diagnosis:

• Diagnose problem areas.
• Segment by the device.
• Segment by the network.
• Examine other trends.
• Create an action plan.

Sometimes, your action plan can be as easy as unpausing a few ads or adding a few keywords or bit modifiers.

Other times it can be in depth - maybe you need to lay out a new ad testing plan because your CTR dropped too much. This lowers your conversions and the offer is no longer available for you. So you need to come up with something new so that can get your CTR conversion rates back up.

Why do we want to look at interrelated metrics?

Let us take a case where your conversion rate went up 55 percent on a MoM timeframe. This may sound like a good number but when you look at all the metrics, it may not be so great. Your impressions increased to 94 percent, clicks increased to 94 percent and cost increased by 73 percent. This means that even though you have good impressions and clicks as a result of your higher cost, your conversion rate is still low.

Take another example where you increased costs to 95 percent. In this case, lets say your impressions went up 74 percent, clicks increased to 108 percent and your conversion rate increased to 136 percent. Now even if your budget increased a lot, because your conversions were higher and CPCs lower, you get a higher conversion rate.

You can analyze all these data yourself by using Google’s Data Studio, which allows you to transform your data into appealing and informative reports.

Conclusion

Simplilearn offers the Advanced Pay Per Click (PPC) Certification Training which is designed to  transform you into an industry-ready paid marketing professional. You will learn to master the nuances of pay per click, display advertising, conversion optimization, and web analytics, and you’ll acquire extensive project experience to prepare you for managing paid marketing initiatives.