Pay-per-click (PPC) for SMBs #11: Understanding KPIs and reporting

Continuing our series of guest posts from Microsoft Advertising...

So Shah’s Cars has campaigns, ad groups and keywords. Its ad copy reads like more digestible Shakespeare and it is live on the web. Job done, right? Wrong, Shah’s Cars’ PPC journey has only just begun.

Using Microsoft’s Advertising tools you can now follow your campaigns, find out how your ads are performing and improve them with amazing results. First, however you need to understand what your key performance indicators (KPIs) are:

There are eight main KPIs in Microsoft Advertising adCenter (however there can be many more depending on your targets):

  • Impressions – The number of times your ad is shown.
  • Clicks – The number of times your ad is clicked on.
  • CTR (Click Through Rate) – How many clicks you get as a percentage of impressions. This is calculated as clicks divided by impressions.
  • CPC (Cost Per Click) – How much it costs you every time someone clicks on your ad.
  • Position – What position you appear on in the search results. There are 3 to 4 ad at the top of the page, and 6 down the right hand side.
  • Spend – How much you’re spending in your chosen currency.
  • Conversions – How many of these clicks lead to conversions.
  • CPA (Cost Per Acquisition) – How much you pay for each conversion.

The first six will be measured for you by adCenter. However, to track conversions and CPAs you will need to place our tracking script into your conversion page. You can find this in any campaign settings page in the adCenter UI.

Just click “show code” and copy and paste the code into your conversion page.

If you do not code your own website, then ask your website designer to do this for you.

Your KPIs will tell you how well your account is doing; however which KPIs you focus on will depend on the purpose of your campaign. For instance, if you are simply looking to make as many sales as possible you will focus on raising the number of clicks. If you want cheap sales you will concentrate on keeping your CPCs low. Sales might not be your primary focus and you might just want to get your brand shown as much as possible in which case you will simply want to increase impressions. Generally customers will be interested in one or more KPIs and must find a balance between them.

You can check your KPIs using the UI either quickly and fluidly on the home screen or you can deep dive into your account using the UI’s 'extensive reporting' tab.

On the home screen the top two widgets on the right side will provide you with up-to-date information on your accounts; you can add or take away KPIs, comparing them if you wish and even change the time scale from hours to month.

The top graph shows KPI changes over a customisable period of time. You can select the timescale at the top, choose whether to look at all or individual campaigns, and select each KPI.

The graphs are really helpful for tracking any changes you make to the account as well as identifying trends.

The bottom table will show you KPI breakdown from each campaign over a set period of time. Choose the time from the top left and select which KPIs you would like to display with the “select column” function, this is fantastic for identifying your top performing campaigns for different KPIs.

Account optimisation makes the difference between accounts that work and ones that don’t 99.999999% of the time and understanding your KPIs and how to interpret them is the key to building a good optimisation.


Other blog posts in the 'PPC for SMB series':

PPC for SMBs #1: Paid and organic search

PPC for SMBs #2: An introduction to Bing

PPC for SMBs #3: An introduction to Microsoft adCenter

PPC for SMBs # 4: An introduction to Microsoft adCenter Desktop

PPC for SMBs #5: The Microsoft Advertising Intelligence Tool

PPC for SMBs #6: Setting up a new adCenter account

PPC for SMBs #7: How to find keywords

PPC for SMBs #8: How to write great ads

PPC for SMBs #9: Bids and match types

PPC for SMBs #10: Negative match types

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