Pay-per-click (PPC) advertising is a cornerstone of digital marketing, offering businesses a direct route to their target audience. While most PPC managers are familiar with common metrics like click-through rate (CTR) and cost per click (CPC), there’s a wealth of advanced key performance indicators (KPIs) that can provide deeper insights into campaign performance and ROI. These lesser-known metrics can be the difference between a good PPC campaign and an exceptional one.
At Gorilla Marketing, we pride ourselves on staying ahead of the curve in the ever-changing world of digital advertising. Our team of PPC experts has extensive experience in managing campaigns across various industries, consistently delivering outstanding results for our clients. In this article, we’ll delve into the advanced KPIs that every PPC manager should be tracking to optimise their campaigns and drive better results.
Why Advanced KPIs Matter in PPC Management
Before we dive into the specific metrics, it’s crucial to understand why these advanced KPIs are so important:
- Deeper Insights: Advanced KPIs provide a more nuanced understanding of campaign performance, going beyond surface-level metrics.
- Improved Decision-Making: With more detailed data, PPC managers can make better-informed decisions about budget allocation and optimisation strategies.
- Competitive Edge: Tracking these metrics can give you an advantage over competitors who may be focusing solely on basic KPIs.
- Better ROI: By understanding and optimising for these advanced metrics, you can improve your overall return on investment.
Essential Advanced KPIs for PPC Managers
1. Quality Score
Quality Score is a metric used by Google Ads to measure the quality and relevance of your keywords and PPC ads. It’s calculated based on several factors, including:
- Expected click-through rate
- Ad relevance
- Landing page experience
A higher Quality Score can lead to lower costs and better ad positions. To improve your Quality Score:
- Ensure your ad copy is relevant to your keywords
- Create tightly themed ad groups
- Optimise your landing pages for relevance and user experience
2. Impression Share
Impression Share is the percentage of impressions your ads receive compared to the total number of impressions they were eligible to receive. This metric helps you understand how much of the potential market you’re capturing.
Impression Share = (Impressions / Total Eligible Impressions) x 100
A low impression share might indicate that your budget is too limited or that your ads aren’t competitive enough. To improve your Impression Share:
- Increase your budget
- Improve your ad quality and relevance
- Adjust your bid strategy
3. What is the Lifetime Value to Cost per Acquisition Ratio (LTV:CAC)?
The Lifetime Value to Cost per Acquisition Ratio (LTV:CAC) is a crucial metric that measures the long-term value of a customer against the cost of acquiring them. This ratio helps determine the overall effectiveness and sustainability of your PPC campaigns.
LTV:CAC Ratio = Customer Lifetime Value / Customer Acquisition Cost
A healthy LTV:CAC ratio is typically 3:1 or higher, meaning the customer’s lifetime value is at least three times the cost of acquiring them. To improve this ratio:
- Focus on acquiring high-value customers
- Implement strategies to increase customer retention and lifetime value
- Optimise your PPC campaigns to reduce acquisition costs
4. Return on Ad Spend (ROAS)
Return on Ad Spend (ROAS) is a metric that measures the revenue generated for every pound spent on advertising. It’s calculated as follows:
ROAS = (Revenue from Ad Campaign / Cost of Ad Campaign) x 100
For example, if you spend £1,000 on a campaign and generate £5,000 in revenue, your ROAS would be 500%. To improve your ROAS:
- Refine your targeting to reach more qualified leads
- Optimise your ad copy and landing pages for conversions
- Adjust your bidding strategy to focus on high-performing keywords and placements
5. Customer Acquisition Cost (CAC)
Customer Acquisition Cost (CAC) is the total cost of acquiring a new customer through your PPC campaigns. It’s calculated by dividing the total cost of your campaign by the number of new customers acquired:
CAC = Total Campaign Cost / Number of New Customers Acquired
A lower CAC indicates a more efficient campaign. To reduce your CAC:
- Improve your targeting to reach more qualified leads
- Optimise your conversion funnel
- Test different ad formats and placements to find the most cost-effective options
6. How Can You Measure Ad Fatigue?
Ad fatigue occurs when your target audience becomes overly familiar with your ads, leading to decreased engagement and performance. While there’s no single metric for ad fatigue, you can track several indicators:
- Declining Click-Through Rate (CTR): A decreasing CTR over time may indicate ad fatigue.
- Increasing Frequency: If the average number of times a user sees your ad (frequency) is increasing without a corresponding increase in conversions, it could signal fatigue.
- Decreasing Conversion Rate: If your conversion rate drops while other metrics remain stable, ad fatigue might be the culprit.
To combat ad fatigue:
- Regularly refresh your ad creative
- Implement ad rotation strategies
- Use frequency capping to limit the number of times a user sees your ad
7. View-Through Conversions
View-Through Conversions occur when a user sees your display ad but doesn’t click on it, yet later visits your website and converts. This metric helps measure the impact of your display ads beyond direct clicks.
To effectively use View-Through Conversions:
- Set an appropriate attribution window (typically 30 days)
- Compare View-Through Conversions with click-based conversions to understand the full impact of your display campaigns
- Use this data to inform your budget allocation between search and display advertising
8. Assisted Conversions
Assisted Conversions are conversions that your ads contributed to, but weren’t the final touchpoint before the conversion. This metric helps you understand the role of your PPC campaigns in the broader customer journey.
To leverage Assisted Conversions:
- Use multi-channel funnel reports to see how different channels work together
- Adjust your attribution model to give appropriate credit to assisting clicks
- Use this data to inform your bidding strategy across different keywords and campaigns
Advanced PPC KPI Dashboard
To help you visualise and track these advanced KPIs, consider creating a dashboard that includes the following:
| Metric | Description | Target |
| Quality Score | Average Quality Score across all keywords | 7+ |
| Impression Share | Percentage of potential impressions captured | 70%+ |
| LTV:CAC Ratio | Ratio of customer lifetime value to acquisition cost | 3:1 or higher |
| ROAS | Return on Ad Spend | 400%+ |
| CAC | Customer Acquisition Cost | Varies by industry |
| CTR Trend | Click-Through Rate over time | Stable or increasing |
| View-Through Conversions | Conversions after ad view without click | Monitor for impact |
| Assisted Conversions | Conversions where ads played a supporting role | Monitor for impact |
Implementing Advanced KPI Tracking in Your PPC Campaigns
Now that we’ve explored these advanced KPIs, it’s time to implement them in your PPC strategy. Here’s a step-by-step approach:
- Audit Your Current Tracking: Review your existing KPIs and identify gaps in your tracking.
- Set Up Advanced Tracking: Implement tracking for the new KPIs using Google Ads, Google Analytics, and any other relevant tools.
- Create Custom Reports: Develop reports that highlight these advanced metrics alongside your standard KPIs.
- Establish Benchmarks: Determine baseline performance for each new metric.
- Set Goals: Based on your benchmarks and industry standards, set realistic goals for each KPI.
- Regular Review: Schedule weekly or monthly reviews to analyse these metrics and adjust your strategy accordingly.
The Power of Advanced KPIs in PPC Management
By incorporating these advanced KPIs into your PPC management strategy, you’ll gain a more comprehensive understanding of your campaigns’ performance. This deeper insight allows for more nuanced optimisation, leading to improved ROI and overall campaign success.
At Gorilla Marketing, we understand the importance of these advanced metrics in driving PPC success. Our team of experts is well-versed in tracking and analysing these KPIs to deliver exceptional results for our clients. If you’re looking to take your PPC campaigns to the next level, contact us to learn how we can help you leverage these advanced KPIs and achieve your digital marketing goals.
Remember, in the fast-paced world of PPC advertising, staying ahead of the curve is crucial. By mastering these advanced KPIs, you’ll be well-equipped to navigate the complexities of PPC management and drive outstanding results for your business or clients.
