How to Make the Most of Google AdWords

In Part 3 of this series, we learned how to precisely limit the distribution of your Google AdWords ad to only those prospects who are most interested, and how to beat the competition with creative bidding strategies. In this installment, we'll learn how to:

• Track the results of your ads and campaigns
• Create a Return on Investment (ROI) report

Tracking and Results

From the moment your AdWords account becomes active, it begins to generate valuable data that will help you optimize and fine-tune your marketing activities. In order to bill you correctly, Google must carefully monitor the number of clicks that each and every one of your keywords and search phrases generates. Not only that, they also have to report on what your active bid was at the precise moment that each click was generated.

It is important that you familiarize yourself with the reporting data that Google provides. Experience has shown that, although one may generate a vast list of search terms, keywords and phrases, it is invariably a very small subset of these search terms that generate the lion's share of cost and clicks. The click reports will alert you to this, and help you optimize your activities.

Some advertisers may have the capacity to track a click directly from a particular site and keyword back to the sale of an item at their site through the use of 'cookies' or other online tracking methods. If you have the ability and resources to create unique tracking URLs for each keyword or search phrase, I highly recommend doing this. The ideal situation for a any advertiser is to know which specific keywords, titles, descriptions, and products are driving the highest return on investment (ROI). Even if you are not capable of tracking a click through to sale, I recommend maintaining an ongoing ROI report as described below.

Closing the Loop - ROI Reports

Below is an example of a general Return on Investment (ROI) report similar to one that I've used extensively to manage cost per click sites, and to optimize our advertising dollars spent there. While it can be somewhat time consuming and resource intensive to generate a report such as this from your actual results, it is well worth the effort if you reveal information that saves you money on bids, or dramatically increases sales.

Please glance through the following report format. Each element is described below.

• Site: The cost per click site that generated the clicks for this reporting period for this keyword.
• Keyword: The keyword or search phrase that generated the click and cost data.
• Total Cost: The total dollar cost for all clicks associated with this keyword over the reporting period.
• Estimated Impressions: An estimate of how many times the ad listing was actually viewed whether it was clicked on or not -- this data is available from your AdWords reporting.
• Clicks: The total number of times the ad listing was clicked during the reporting period.
• Average Cost Per Click: The average cost per click during the reporting period.
• Clickthrough Percent: The number of clicks divided by the number of estimated impressions for the reporting period.
• Sales: The total number of sales generated by this keyword during the reporting period.
• Cost Per Sale: The total cost divided by sales for the reporting period.

The key to successful ROI is to manage your campaigns by sales. The optimum campaigns are driving the highest volume of sales for the lowest possible cost per sale. If you're optimizing your listings according to how many sales they make and the cost of those sales, you have mastered the secret of the ROI report.

Summary

The purpose of this series is to get you started with a solid foundation of great information learned through years of day-to-day experience with cost per click sites. The tips included in this series should place you well ahead of your competition in the quest for more sales and lower costs in Google AdWords. This is only a beginning, and you will develop your own style, methodologies and secrets as you become more familiar with the Google AdWords product. I wish you well in your online endeavors!