We run a lot of PPC campaigns here, and I see a lot of PPC metrics and data. One thing I’ve learned is that, when it comes to PPC, metrics and KPIs, even the bad can be good and vice versa.
How can that be possible? For PPC metrics to be most actionable, they need to be looked at with a holistic approach – instead of being singled out. No metric is an island. When looked at as part of the big picture, the metric can be measured against business and campaign goals to see the true success of any particular KPI.
High Conversion Volume
In some campaigns, a high conversion volume can be a fantastic KPI, but cherry picked without more data to put the KPI into perspective can make it a dangerous data-point on which to judge an entire campaign.
For the goal of driving leads/conversions, a high conversion volume can be either good or bad. Unfortunately, it still needs further qualifiers. For example, if each conversion is costing too much, then high conversions are bad.
On the flip side, if the conversion costs are where you want them to be for the campaign, then provided you’re converting high-quality traffic – or even low quality with really high LTVs – it can be a good thing.
Click-Through Rate (CTR)
Click-through rate (CTR) is another KPI that can be tricky. Like a high conversion volume, it can’t simply be looked at alone.
A couple examples where this KPI could conflict are B2C sales and branding. If sales are your objective and you are running PPC ads that are designed to entice customers to take advantage of a promotion on your site, then CTR is great – as long as it’s coupled with an appropriate cost per click (CPC) and adequate conversion rates. However, if branding (display campaigns) is the goal, low click through, or low to no conversions, aren’t bad at all.
Again, it’s a KPI that should be looked at with other campaign and business goals in mind.
Cost Per Conversion (CPC)
A low cost per conversion (CPC) sounds great alone. But on the other hand, driving down the CPC could also be a bad thing if you’re only selling low margin products or driving poor leads.
The aggressiveness of your goals, your desired outcome and the competitive landscape all matter when considering this KPI.
The Bottom Line?
Most metrics can be misleading when considered alone. All metrics could be considered bad when the business objectives aren’t used to guide them. A holistic approach to reviewing KPIs for PPC campaigns yield the best results, which makes analyzing metrics tricky if you’re not aware of the larger business objectives.