As a PPC marketer, you need to understand your campaigns’ performance and find ways to improve them. Yet there may be times when you overload your senses with all the available PPC metrics.

We understand that.

That’s exactly why we focus on solidifying your PPC analysis basics in this article. It will help you identify your optimization paths. Let’s get into it!

What is a PPC Analysis?

A PPC analysis gives a better idea of ad campaign performances, leaving you with actionable takeaways. It is a great way to derive insights, improve weak links and enhance your PPC campaigns to drive better results. Without PPC analysis, you merely look at numbers that don’t contribute much to your campaign’s success.

There are plenty of PPC analysis tools that offer tons of valuable data insights saving a lot of time.  Using these tools gives you a much better understanding of your key campaign metrics like visibility, conversions, quality score, click-through rate, and more.

Here is what a PPC analysis looks like-

Growth Nirvana is a PPC reporting tool that automatically pulls PPC data from multiple platforms to measure your performance. It uses metrics like the number of clicks, impression shares, and overall campaign costs. With Growth Nirvana, you can generate insightful visual reports and guide tracking of vital PPC KPIs.

What to include in PPC Analysis?

Making sense of PPC data can be daunting if you don’t know which information to pay attention to.

Here we will discuss 5 key metrics you can use as KPIs which will help you to –

• Optimize ad campaigns
• Identify the most lucrative marketing channels
• Better understand your target audience
• Keeping your budget in check

Let’s have a look.

Quality Score

Mastering PPC, especially Google Ads, requires a solid understanding of Quality Score. It is Google’s rating of the quality and relevance of your keywords and PPC ads.

Quality Score affects your PPC ads performance and how much you pay for each click. It considers your cost per click (CPC) multiplied by the maximum bid to determine your ad rank in the ad auction process.

Source

Your Quality Score depends on several factors, like:

• Click-Through rate (CTR).
• Keyword relevance to its ad group.
• Landing page relevance and quality.
• Ad text relevance.
• Your historical Google Ads account performance.

These are the core Quality Score components. It is difficult to tell how much each factor contributes in the Quality Score algorithm, but we know that the click-through rate is the most important component.

When people who see your ad click on it, it is a strong signal to Google that your ads are relevant and beneficial to users.

Cost-per-click

Cost-per-click refers to how much money it costs each time a user clicks on your ad. Most clients want to know how their money spent impacts their ads and campaigns. When you track CPC, they can see exactly how much each click costs.

Clients prioritize achieving a good ROI. Comparing the CPC of a campaign will ensure that Google isn’t pushing bids higher over time and taking up more budget than they are willing to spend.

CPC = Advertising cost/ number of clicks generated by an advertisement

For example, if an advertiser pays $20 for 500 clicks on its ad, the cost per click is $ 20/500, or $0.04.

It is also important to note that the amount you pay for a class depends on how competitive your industry is. More competition typically means higher costs. Other things affecting CPC are location and market niche.

Some of the CPC best practices include-

• Performing keyword research
• Focussing on bid management
• Optimizing landing pages

Impressions

An impression is when someone views your ad, irrespective of clicks. For example, if your PPC ad is placed at the bottom of the search engine, an impression will not be counted unless a user scrolls down the page and sees the ad.

Impressions are important because they can tell if your ad reaches your audience and increases brand awareness. Viewers aren’t finding your ad relevant or attractive enough to click if your ad has high impressions but low clicks.

You can measure impressions by tracking the total number of times your ad has been displayed within a specific period.

Impressions = Cost/ (CPM x 1000)

Click-Through-Rate

CTR is the rate at which your PPC ads are clicked. The formula for CTR looks like-

(Total Clicks on Ad) / (Total Impressions) = Click-Through-Rate

For example, if you had 10 clicks and 100 impressions, your CTR would be 10/100%= 10%.

Monitoring your CTR  can help in –

• remaining in competition with your competitors
• keeping up engagement on your ads
• analyzing ROI to see if your ad copy is relevant and driving conversions.

High CTR leads to high-quality scores and enables improving your ad position or maintaining it for lower costs. Also, if you advertise on relevant queries, achieving a high CTR means driving more leads to your product and services.

Return on Ad Spend (ROAS)

ROAS measures the profitability of an ad campaign. It aims to determine how much money was spent throughout the campaign and compares it with the total revenue generated.

ROAS = Total Campaign Revenue/Total Campaign Cost

For example, if a business aims to make $2 for every $1 spent on advertising, the ROAS will be 200% or 2:1.

Understanding your ROAS is important because it helps you to-

• identify the most lucrative PPC channels
• understand your target audience
• optimize future campaigns.

There are multiple ways to calculate ad costs. At times, you may want to track the actual amount spent on a specific ad platform, whereas other times, you may want to consider additional advertising costs like:

• Salary Costs – The cost of in-house teams managing ad campaigns.

• Vendor Costs – Fees and commissions from vendors that facilitate the ad campaign.
• Affiliate costs – Individual affiliate commissions and any affiliate network fees.

Depending on the type of ad campaign you’re running, you can calculate the ROAS purely based on ad costs and a separate ROAS that includes these additional advertising expenses to get a complete picture of the campaign’s profitability.

5 Powerful Tips to Analyze and Optimize PPC Campaigns

Here are our tried-and-tested tips to help you analyze your PPC campaigns and optimize them effectively-

1. Understand your audience

The right kind of PPC marketing does not necessarily mean reaching as many people as possible, but how you engage and encourage your audience to act (sign up, buy, request a demo).

And the best way to do this is to know everything about your audience – the device they use, their interests, location, demographic details, and more. 

If we begin from the beginning, the first way to do this is to identify your target audience correctly.

For example, an online bookkeeping software’s target market might include businesses with over $100,000 in annual revenue.

So the appropriate target audience profile for the bookkeeping program might be technology stakeholders who influence decision-makers in companies that haven’t reviewed their accounting software needs in over 2 years. This is much more specific than the target market, which is important because you can curate content marketing that speaks directly to the challenges and needs of the group.

After you have identified the specific target group, you need to-

• Identify who is engaging with your audience. You may be surprised to find that your target audience is different or includes more people than you thought.
• Analyze the devices (mobile, tablet, or desktop) your audience uses to view your PPC ad.

Remember that you use both demographic and psychographic information to identify your target audience-

• Demographics include cursory information such as gender, age, income, and marital status.
• Psychographics include personal interests, attitudes, values, desires, and behaviors.

The psychographic data for this specific audience could include: worrying about lost resources throughout a supply chain, or being skeptical of flashy new technology.

Understanding your audience better will help you produce ad copy that resonates better with them, leading to higher engagement and more conversions.

2. Analyze your competition

Tracking and analyzing your competition is one of the most important practices as it helps you to know your and your competitor’s standing in the current market landscape.

The plan is to identify patterns to understand what works and what doesn’t. 

Ideally, there are six key steps involved in an effective PPC competitive analysis:

• Identify your competitors
• Analyze their PPC strategy
• Analyze their ad copy and landing pages
• Identify their target audience
• Analyze their budget and ad spend
• Analyze their performance and ROI

We know it is a lot of work and can overwhelm you.

💡Here’s a pro tip-

Using a PPC data analysis tool like Growth Nirvana can help you analyze essential metrics like-

• Total ad spend 

Know your total spending on Facebook and Google Ads. Monitor channels to measure ROI and identify campaigns that perform well and deserve more investment.

• Facebook Ads account overview

Track engagement metrics, such as CTR, impressions, CPC, and more, to determine which campaigns generate the highest ROI.

• Google Ads keyword overview

Identify which keywords generate the most impressions and clicks from your Google Ads campaigns.

This will make your job much easier as you can focus more on making impactful decisions and less on gathering and detangling data from scattered sources. With Growth Nirvana’s PPC reporting software, you can automate data collection and analysis and generate reports to make goal-driven decisions faster.

3. Review your account structure

For conducting an impactful PPC analysis, you cannot miss on reviewing your account structure. How you structure your Google Ads account lets you control when and where you want them to appear. A well-structured account will help you to-

• Ensure that relevant ads are shown to your audience.
• Result in better Quality Scores, which leads to better results and lower prices.
• Keeps you organized and optimized. 

Reviewing your account structure can expand, test, and analyze your site to see how you can improve your campaign. Here are the things you need to look for when reviewing your account structure- 

• The number of your campaigns
• Your ad groups and how they’re segmented
• Your bidding method
• Your campaign settings
• Your budget

4. Find performance bottlenecks

Sometimes even if you think you are doing everything right, the campaign doesn’t seem to be doing well enough. This can be because of underlying factors like keyword stuffing, issues with landing pages, poorly structured accounts etc., impacting PPC performance.

Finding performance bottlenecks is important to ensure your efforts move in the right direction. The approach includes-

• Defining the problem

Clearly state the problem and its impact on your PPC campaigns while making sure everyone involved understands the issue.

• Gathering data

Collect relevant data about the problem (when it started, how often it occurs, and what factors are involved).

• Identifying potential causes

Brainstorm all possible causes of the problem and list them down.

• Testing the cause

Analyze the data to see which potential reason is most likely to be the root cause. Test your hypothesis by implementing a solution and measuring its effectiveness.

• Implementing a solution

Once you find the solution that addresses the root cause, implement it. Then, monitor the results of your PPC account and adjust the solution as needed.

A very fitting principle here relevant to your PPC analysis process would be the “Five Whys Technique”. It is a tool used to identify the underlying cause of a problem. The technique involves asking “why” five times to get to the root cause of the issue. It is based on the idea that every problem has a deeper cause. 

Here is an example to illustrate the method-

• Conversions dropped by 30% between March 15 and March 20. Why?

• Start by analyzing PPC traffic. Traffic and other metrics appeared stable, but the average conversion rate dropped. Also, there were no significant changes to the bidding algorithm, targeting, or audience signals. Why then?  

• Analyzing the website. Website traffic does not look like an issue. Engagement metrics like session time on the website and bounce rate look stable. Site engagement was also steady, but purchase rates declined. Why? 

• Interrogating the website team about website changes. They said site changes were made during this time. Why does the issue persist? 

• The development team removed a series of popular products due to low inventory. They haven’t yet had the chance to notify all the teams. 

Though, this is not the only way to diagnose a PPC account. But you can see how this process pushes account managers to continue digging deeper to find the right answers.

5. Monitor your post timings

For a successful PPC analysis, it is important to monitor your post timings. This is a great practice if you have a limited budget. Analyzing your posting times will help you identify when your ad attracts leads or you get minimal traffic.

This will also help you optimize your campaign to prevent wasted ad spend. Also, by identifying instances when the audience isn’t engaging enough with your ads, you can stop running those ads. 

Summing up

To conclude, PPC analysis mainly involves reviewing your key metrics, audience and competitors, account structure, identifying performance bottlenecks, and reviewing the basics such as campaign settings and bidding model.

All this might sound overwhelming, but it doesn’t have to be with the right tool. Let us introduce you to the PPC analytics tool that will help review your campaign’s performance in an easy-to-understand manner.

Growth Nirvana is a PPC analysis tool that makes it super easy for you to review important campaign metrics and visualize them comprehensively. Pull data from multiple platforms and get a 360-degree view of all the campaign metrics we discussed and more. Generate automated reports and view them all in one place and in real time.

Schedule a demo now!

FAQs

Do people click on online PPC ads?

Yes. Ads appearing in the search results earn more than 45% of page clicks. 

What factors determine my PPC costs?

In PPC, the pay per click depends on multiple factors, including bid, targeting, and ad quality.

How often should I check my PPC campaigns?

For best results, PPC experts recommend weekly campaign check-ins. In comparison, brand-new campaigns should receive daily monitoring.