If you asked most marketers what’s the biggest draw of online advertising, you’ll often hear is that it is highly measurable. Interactivity (the ability to click and engage) is certainly a huge benefit as well, but if you’re a marketer who is spending significant dollars on your advertising, just getting people to interact with your advertising is not as important as knowing if it was achieving whatever goals or return on investment (ROI) that the budget was earmarked for in the first place.
Since the first caveman got rich by spreading a word of mouth campaign that his clubs were bigger and heavier than the other guy’s, advertisers have known that marketing works. Marketing has evolved in many ways over the years and become more and more efficient, yet accurate tracking still eludes us. There have certainly been strides in perfecting offline measurement techniques in the form of television set-top monitoring, surveys, brand studies, etc, but it’s directional at best. Some large advertisers have been able to sink significant budgets into their data teams and have been able to crack the nut, but true ROI measurement has eluded most advertisers. It’s kind of been the mentality of “Well, my business was up (or down) this year so my advertising probably contributed to that.”
Because online marketing is electronic, every transaction leaves some kind of digital footprint. For every online sale, lead generation form completion, download, video view, etc., we can trace back that influence to some detail. In paid search, once your tracking is implemented, you will be able to see which keywords helped to contribute to your online conversions. Not only will this help you analyze whether or not your spend is working or not, but it will also give you some powerful data to optimize your accounts and increase the performance on those elements. A blunt example of this would be if keyword #1 is driving a ton of sales and keyword #2 is not driving any, you may decide to pause keyword #2 and funnel that budget to keyword #1.
How tracking works
The concept is fairly simple. You will generate a small snippet of code from the engine platform and place it on various pages of your website (it’s invisible to users). When a user clicks one of your ads, their browser is cookied with that information. If that same user reaches one of those pages with the engine code, a conversion is recorded. So, if you want to see if someone filled out a lead gen form or completed a sale, you would put the conversion code on the thank you/order confirmation/receipt page which comes up after they’ve completed an action. For retail sites, there are special ecommerce tracking codes which can be set to record the order amount, number of products, names of products, etc. So, for example, instead of seeing that keyword #1 brought in 100 conversions last month, you actually see 100 conversions that equaled $1295 in sales. This is obviously a very good way to compare your PPC spend with the actual sales generated.
Sometimes, we have to tweak websites in a special way in order to have a thank you page to tag with the conversion code. If a website’s goal is to get users to watch their videos, sometimes, instead of putting all of the videos on one page, a list of links are offered. This way, when a user chooses a link to go watch the video, the code can be applied there in order to track that conversion.
Before we dive into conversion tracking implementation, I need to pause here and explain something very important about tracking. For the most part, in paid search, if you see that a conversion has been attributed to a specific keyword, it was that keyword’s ad was the last ad clicked before the conversion. This is a very crucial thing to understand. There are usually many interactions between a company and a consumer before a conversion takes place—from offline advertising such as television or radio commercials, online advertising such as banners and emails, word of mouth, social sharing, etc. There may have even been several PPC impressions and clicks before the final ad converted. So, just keep that in the back of your mind when you’re looking at conversion numbers and making optimization decisions.
Does this mean that conversion tracking isn’t helpful at all? Certainly not. The last ad clicked is an important piece of the puzzle, but to attribute 100% of your conversions to single keyword ad clicks is probably directional at best. Paid search has become a navigational tool, almost in line with how people used the Yellow Pages decades ago. If a consumer has it in their mind that they want to buy from you and they can’t find you, then, of course, your paid ads are extremely valuable to completing that purchase. Or, if a user is searching on a topic and happen to be drawn to your site, only to buy later, that’s a good use of PPC advertising as well.
My main concern here is when search marketers put their blinders on and read conversion reports as if they never take into account where paid search ads actually fall into consumer purchase behavior. The rookie search marketer immediately wants to pause any keywords with seemingly low ROI without considering the full picture. I don’t want you to fall into that trap. If you don’t understand how this all works right now, don’t worry. Once you start to analyze and optimize your accounts it will become clear. But it’s important to understand this point now.
Implementing PPC tracking
Because each of the engines handle conversion tracking differently, I’m going to direct you to their individual online resources on these topics. But you have the basics down: you will generate codes for each conversion and place those codes on the web pages you wish to track. When a user clicks your ad and then reaches one of those pages, a conversion is recorded. That’s all you need to get started.
- Google AdWords Conversion Tracking Setup Guide
- Welcome to adCenter Conversion Tracking
- Yahoo Conversion-Only Analytics
PPC Academy is a comprehensive, one-year search advertising course from beginning to end. Starting with the basics, PPC Academy progressively explores all of the varied facets of paid search, and the tactics needed to succeed and become an advanced paid search marketer.
Opinions expressed in this article are those of the guest author and not necessarily Search Engine Land. Staff authors are listed here.