Simple. The valuable action that you are tracking, whether that be someone making a purchase or signing up to your newsletter. The conversion tracking tag is placed on the page where this action occurs and fires every time someone completes the action. This is useful information to track, as although a click may indicate that someone has shown interest in your product or service, a Conversion indicates that someone is interested enough to buy in, and thus helps you to optimise your AdWords campaigns to a more accurate degree. If, for example, you notice that more users are converting from a certain keyword, you can adjust your bids to reflect this, encouraging more clicks and conversions. If you are using bid strategies to optimise your conversions, it is your conversion data that AdWords will factor in when automating bidding. With conversion data, we are also able to track revenue, Cost per Conversion (CPA), Return on Ad Spend (ROAS), Conversion Rate, and many more metrics. When we may use each is mostly dependent on your business goal, so it’s best to get a good understanding of each one before you start out.
AdWords Next Conversion Columns
Cost per Conversion (Cost / conv.)
This is how much, on average, a conversion costs. Cost / conv. (CPA) is worked out by dividing the total cost by the number of conversions, whether that be leads, transactions, or another valuable action. For example, a luxury car company may have a CPA of £50 for an email registration. This may look high, however if a lead converts with a value of £10,000, this justifies having a higher CPA. Conversely, if a local plumbing service has a CPA of £50 but charges £20 per hour of service, this does not warrant paying so much for a lead. The aim would be to reduce this CPA, by going through the Search Query Report to make sure we are only targeting relevant search terms, reducing bids of high-spending keywords, or pausing them if they haven’t previously converted.
AdWords Previous Conversion Columns
Conversion Rate (Conv. rate)
This represents how often, on average, a click or interaction went on to become a conversion. For example, a Conv. rate of 25% means a quarter of users who clicked through to the site went on to convert. This number may vary depending on the type of search query you are targeting. More specific searches may indicate users who are closer to purchase, and so may show higher intent to convert. In this case, the Conv. Rate will be higher. We may see this for example in Brand and RLSA campaigns, where we are targeting an audience of users who are already aware of your service or product. For more generic searchers, users are earlier on in their conversion journey and may still be researching, so are probably less likely to convert. Here, we would see a much lower Conv. Rate. This metric is also useful in helping you work out if you have any site issues. If you are noticing a lot of traffic going to a page and you have a high Click Through Rate but low Conv. Rate, this may indicate that users are either not finding what they are looking for or there are problems on the web page.
Conversion Value (AdWords Next)
This is the sum of conversion values for each of your conversions, or essentially, revenue. This column is only available within the New AdWords experience, and was previously called “Total Conv. Value”. To see this figure, values will need to be entered manually or pulled in from your website, by editing the website code. For more information on how to set this up, help can be found here. Once you are pulling in Conversion Value data, you will be able to track profit, ROAS and ROI.
Total Conversion Value (AdWords Previous)
This is only available to view in the Previous AdWords experience, and is being replaced by “Conv. Value” in AdWords Next (see above).
Conversion Value over Cost (Conv. value / Cost)
This column helps you to work out your Return on Investment (ROI), by dividing the total Conv. value (revenue) by the total Cost. Working out ROI may be important for you if revenue and cost are key performance indicators, as essentially it will tell you how much revenue you’re generating vs. spend. You can use this column to improve aspects of your campaigns, such as keyword bids, demographics, audiences and devices. It is generally thought that Brand campaigns will have a higher ROI, as users are more likely to convert if they already know what they are looking for. Conversely, you may expect to see a lower ROI for Generic keywords, as these are more centred around research, comparison and raising brand awareness.
Conversion Value per Click (Conv. value / Click)
This is the average revenue for each individual click. It is often forgotten about, but can line up quite nicely with your cost per click (CPC) column. If for example, you are seeing an average CPC of £0.20, but an average RPC of £0.23, the profit margin is pretty narrow. In this case, you may consider lowering your max bid in an attempt to reduce the average CPC, or make some bid adjustments to try and increase RPC. RPC can essentially break down your performance and profitability to as granular as keyword level and can therefore help indicate key winners and how you might want to set your keyword bids.
Value per Conversion (Value / Conv.)
This column will tell you the average value of each conversion – in other words how much revenue, on average, is accumulated per order (AOV). This type of information is useful when allocating budget, adjusting keyword bids and developing strategy. You may find for example, that by increasing bids in Shopping Campaigns for products with a lower AOV, you can help increase your traffic to site as users may be attracted by products with a lower price point. Conversely, you may find you want to reduce your bids for products with a lower AOV, as the low revenue to cost ratio is bringing down your ROI. Looking at AOV can also help you work out why, for example, one week you saw an increase in transactions but not in revenue, perhaps due to promotional activity on site.
The columns mentioned above are looking at only the conversions that you have chosen to include in the Conversion column. You may want to track different conversion actions, for example, sales and newsletter sign ups. Some actions may hold values of higher importance to your business, such as a sale, while others may be useful to track but not necessarily something you want to optimise your data towards. You may also want to measure conversions that happen across multiple devices. Looking at the All Conversions column enables you to keep track of every conversion that your campaigns drive, (including each of the conversion actions that you’ve also chosen to exclude from the conversions column), as well as more complicated actions such as in-store visits, phone calls, and cross-device conversions. It is also possible to view each of the above columns for all conversions. This includes:
- Cost / all conv. (AdWords next)
- All conv. rate
- All conv. value
- All conv. value / cost (AdWords next)
- All conv. value / click
- Value / all conv. (AdWords next)
This column tells you when a user sees your ad, doesn’t interact with it, then later goes on to convert on your site. This conversion type is more useful when assessing the value of display and video activity, as it indicates that your ad may have played a significant role in raising brand awareness and increasing a customer’s intent to purchase at a later date. These are not included in the Conversions column and are currently only available for Display, Video and Gmail campaigns.
A cross-device conversion occurs when a user clicks on one of your ads on one device and then proceedsto convert on another. This column reports the total number of cross-device conversions across all recorded conversion actions for AdWords traffic in Search, Display, YouTube and AdMob. App Install conversions and imported goals from Analytics are not included. This metric is helpful when attributing your conversions to the correct campaign, ad group or keyword, and can assist in optimising your keywords. It can also better inform you in how to weight your bids for different types of devices. For example, by segmenting your data by Device Type, you will be able to compare how each device contributed to direct and cross device conversions, helping you more accurately optimise mobile, tablet and desktop bids.
Example of a cross-device conversion pathway
Phone call conv. (AdWords Previous – in Phone Call tab in AdWords Next)
There are multiple call conversions available for you to track, such as calls from ads, calls to or clicks on a phone number on your website, and Imported Call Conversions using an external system. This column is useful to look at if phone calls to your business are of high value, and helps you to work out which keywords and ads are most effective in driving phone traffic. This can also help you work out your ROI, to make data-based decisions on your bids.
In short, the benefit of tracking conversions is undeniable. AdWords offers you a huge variety of conversion columns to help you measure your success, and being able to evaluate how your ads can lead to valuable actions will be able to assist you in making decisions for bidding, budgets and future strategy.