Google AdWords – the only two numbers you should worry about

If your business is using an agency to manage Google AdWords, you probably get a report each month will all sorts of numbers.

Click through rates, cost per click, quality score, clicks, impressions, keyword data… and so on. You might get some fancy graphs, which the agency uses to show how great your campaign is doing.

Most business owners look at these numbers and graphs, and their eyes glaze over. It’s easy for the agency to put a positive spin on just about any data to make it look like they’re doing a great job.

So how do you know how well your AdWords campaign is really doing?

When you strip away all the jargon, geek-speak and fancy sounding B.S. the answer is actually quite simple.

As a business owner, there are just two numbers you need to worry about with Google AdWords.

1. How much money are you spending on AdWords per month (cost to Google + the management fee your agency charges).

2. How much extra money are you making as a result of what you are spending on AdWords.

That’s it. How much are you spending on AdWords. And how much extra money are you making as a result?

Generally speaking, if the second number is significantly larger than the first, your AdWords campaign is successful. (There are some highly competitive markets where businesses are willing to just break even on AdWords, or even lose money to get the sale – and then make it up with repeat business over the lifetime of the customer.)

Money in versus money out

The bottom line is, you can safely ignore most of the numbers your agency provides in their fancy AdWords reports. Just look for the two numbers I mentioned above – i.e. money in, versus money out.

Sometimes it’s difficult to measure exactly how much extra money you’re making directly from AdWords. If you are selling products from your website, it’s quite straightforward because you can track the sales back to AdWords. But if you are selling services where clients generally phone to make an enquiry, which may or may not lead to a sale, it’s more difficult to track.

So you need to pro-active in this regard. Where possible, ask clients how they found your website. It’s usually possible over time to get a feel for how much business is coming from AdWords versus other forms of marketing.

Marketing with Google AdWords can be a complex process. It’s not just about click through rates, or even the number of clicks you get to your website. Just getting a visitor to your website is only half the job done. The second step is that your website needs to convert that visitor into a customer or client. Your website needs to take up where the AdWords ad left off. A lot of websites fall down at this point, so the AdWords investment is wasted.

Since 2005 I’ve managed a large amount of AdWords accounts. I’ve learned a lot of the pitfalls and how to get the best results. If you would like a free assessment of your AdWords campaign, just call me on 03 377 3637 or email chris@chrismole.co.nz. I will look over your campaign and give you an honest assessment of how I think it’s doing and whether it can be improved.