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10 Most Important PPC Metrics to Track

Samuel Edwards
|
April 7, 2021

When it comes to Pay-Per-Click marketing, advertisers are inundated with an endless list of metrics to track and measure. That’s because, unlike other traditional methods of advertising, PPC offers some fantastic ways to keep tabs on every aspect of a campaign. There is no denying the fact that PPC ad campaigns are data-driven to the max.

This also makes it easy for marketers to lose themselves in all the clicks, impressions, and other rates that may or may not make a real difference to the bottom line. After all, not all metrics are equal.

This begs the question: which figures are the most important to monitor?

There isn’t a one-size-fits-all answer because the most critical metrics vary according to the goals of a PPC campaign. Still, there are a few KPIs that are fundamental for the success of every campaign.

Here are the top metrics and KPIs to monitor:

1. Conversion Rate (CVR)

The number of conversions resulting from a campaign is almost always the first priority of an advertiser unless their objective is only brand awareness. Ultimately, profits start with conversion, so it’s the number one priority of any business.

To measure the conversion rate, divide a campaign’s conversions by its total clicks.

For instance, a campaign with fifty clicks and five conversions will give a conversion rate of 10% when expressed as a percentage. Even though conversions are significant for campaign managers, they sometimes create campaigns optimized for clicks instead.

2. Clicks

A click is the starting point of any conversion, making it a preliminary success indicator of a PPC campaign. It takes into account the number of people who clicked on your ad.

These clicks help campaign managers tweak their approach from time to time, even during a campaign’s running time. They can check on ads’ clicks throughout to see which are performing well to put more bids on them and pause those ads completely that are not faring well.

For mid-month performance measurements, clicks are a handy KPI, but of course, you cannot rely on just clicks to determine a campaign’s success.

3. Click-Through Rate (CTR)

Click-Through Rate (CTR)

Similar to how your clicks generated in a campaign measure its performance, CTR plays a vital role in determining the success of a campaign’s performance.

It is measured by the division of the total number of clicks generated by your campaign in a particular period from the total impressions. So, for instance, if your ad got 150 clicks and the total impressions were 1,000, then your CTR is 15% in that case.

It is essential to understand that a perfect CTR does not exist because industry types and other variables affect the PPC performance.

According to 2018 research, the differences in the average CTR of the auto industry and the dating and personals industry were 4% and 6.05%, respectively. So, suppose campaign managers rely entirely on these numbers as a benchmark for their CTR success. In that case, they will overlook the analysis of other variables that affect their campaigns differently.

When you compare CTR from other similar campaigns, they provide a good benchmark for improving upon.

4. Quality Score

One of the most difficult KPIs to measure is the Quality Score. Created by Google, this metric aims to point out your ad content’s relevancy with the help of CTR metric and more performance variables such as landing page experience.

However, it is difficult for advertisers to understand this metric because it is not as straightforward to measure as other KPIs such as clicks.

Google can evaluate an ad’s quality score with the help of expected CTR, ad format, ad relevance, and landing page experience.

When it comes to measuring the Quality Score, Google is upfront about its process and importance. In 2017, Google improved on how it reported Quality Score in Google ads, though the following aspects need to be kept in mind:

If you pay less money to Google Ads for campaigns, you will get a good Quality Score ranging between 7 and 10. However, if you pay more for ads, you will get a bad score of 6 or lower.

With a change in the Quality Score reports, advertisers found it easier to use it in Google Ads along with the provision of KPI’s historical data. Such insights are precious for advertisers to come up with better campaign decisions.

Advertisers are always highly interested in how they can improve the Quality Score as a means to determine the cost they pay for every click.

Additionally, Quality Score can influence KPIs like CPA and CPC.

5. Cost Per Click (CPC)

PPC advertisers usually have a set budget that guides them on how to spend on an ad campaign. However, the bid and budget they specify for a PPC campaign are not guaranteed amounts that they will end up paying.

Advertisers place a higher bid than their competitors to get ad positions but pay a bid price second to it. As a result, your competitors in a PPC auction determine the cost of the ad you put up and the clicks it generates.

If you want to know the exact amount an advertiser pays for a campaign, calculate the CPC. Divide a campaign’s total cost by the number of clicks that ad generated.

To manually calculate your campaign’s cost, multiply a campaign’s clicks with the CPC.

In addition, you should think about methods for reducing your cost per click.

6. Cost Per Acquisition (CPA)

For advertising campaigns, you can come up with a cost per acquisition (CPA) which is the cost of acquiring a new customer. You can determine the CPA when you divide the total conversion costs by the total conversions.

Sometimes advertisers also opt for a bidding technique for a campaign to use a targeted CPA. This helps them use a CPA according to their budget with an automatic bid setting to get maximum conversions.

It is essential to have conversion tracking, know various bidding strategies and have a minimum of thirty to fifty conversions within the past 30 days of using a targeted CPA.

7. Impression Share (CPM)

We all know impressions matter a lot where ads are concerned, and it doesn’t include them clicking on it. So the number of impressions for a campaign won’t indicate its success because there is no way to tell your ad’s effectiveness on your audience.

However, with the help of impression share, you can determine the number of impressions your campaigns generate. It is calculated when you divide your campaign’s total impressions by the impressions it was eligible to have.

If you want indirect yet competitive insight, impression share is a key metric you should have an eye on. For instance, if your impression share is 50% for some keyword, you can determine that the rest of the 50% is with your competitors.

You can reduce your competitors’ ad display by increasing your impression share. On the other hand, you’ll have to improve your bids to improve their impression share.

8. Average Position

Whether search results for a query are paid or organic, Google has a way to balance them both. Google and Bing ads are displayed on top of the results page. The first one is at the highest position, the next one underneath that, and so on.

Advertisers determine the usual position of their ads with its average position. It is important to understand that Google doesn’t always place the highest bidders’ ads in the first place, for which they use the ad rank to figure out the average position.

You can find out the ad rank when you multiply Quality Score with the maximum CPM of an advertiser. However, this is an average, so even after calculations, you can’t tell your ad’s exact position.

It is natural to aim for the first position, but this is just to satisfy numbers because it doesn’t guarantee results.

It is also possible for some advertisers to get more conversions while in the fourth position than the first one. Hence, the average position should only be used as a point of reference but not as a target indicator as it doesn’t necessarily give the information you want.

In addition, it will also benefit to look at how Google Ads extensions perform relative to the normal listings in your campaign.

9. Budget Attainment

More often than not, paid marketers have a monthly budget they need to follow for an ad campaign. To what extent they achieve the budget they were given is determined by the budget attainment.

However, many PPC marketers don’t measure their PPC performance based on budget attainment, even if it provides a lot of information regarding their campaign’s management.

It is not easy to bid regularly and optimize results when PPC auction variations require continuous oversight. This is why marketers end up overspending or underspending on their budget frequently.

Nonetheless, PPC marketers should consider budget attainment as a valuable KPI.

10. Lifetime Value

A highly significant indicator of a PPC marketers’ skills and account health is the Lifetime Value (LTV). However, it is slightly complex to calculate a paid searches’ CLV.

When companies acquire customers through paid search and retain them for a longer time, they make more revenue.

LTV can be measured in several ways, even though it evaluates a customer’s lifetime with a business’s product. For instance, a large company such as Target will have a complicated LTV due to several aspects to it like customer retention rate, applied discounts, customer lifespan, etc.

PPC marketers generally avoid such calculations, but this KPI’s measurement could be precious for other departments.

Conclusion

There are many KPIs that you can use, and you might be tempted to use all of them. It is essential to understand your campaign and carefully choose metrics that suit it best so you can optimize them and get better results.

Chances are that your goal is to bring more traffic to your website, increase sales and enhance brand awareness through various campaigns. Understand what works for your campaign and what doesn’t, based on the KPIs you track.

Author
Recent Posts

Samuel Edwards

Chief Marketing Officer

Throughout his extensive 10+ year journey as a digital marketer, Sam has left an indelible mark on both small businesses and Fortune 500 enterprises alike. His portfolio boasts collaborations with esteemed entities such as NASDAQ OMX, eBay, Duncan Hines, Drew Barrymore, Price Benowitz LLP, a prominent law firm based in Washington, DC, and the esteemed human rights organization Amnesty International. In his role as a technical SEO and digital marketing strategist, Sam takes the helm of all paid and organic operations teams, steering client SEO services, link building initiatives, and white label digital marketing partnerships to unparalleled success. An esteemed thought leader in the industry, Sam is a recurring speaker at the esteemed Search Marketing Expo conference series and has graced the TEDx stage with his insights. Today, he channels his expertise into direct collaboration with high-end clients spanning diverse verticals, where he meticulously crafts strategies to optimize on and off-site SEO ROI through the seamless integration of content marketing and link building.

Latest posts by

Samuel Edwards

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Author

Samuel Edwards

Chief Marketing Officer

Throughout his extensive 10+ year journey as a digital marketer, Sam has left an indelible mark on both small businesses and Fortune 500 enterprises alike. His portfolio boasts collaborations with esteemed entities such as NASDAQ OMX, eBay, Duncan Hines, Drew Barrymore, Price Benowitz LLP, a prominent law firm based in Washington, DC, and the esteemed human rights organization Amnesty International. In his role as a technical SEO and digital marketing strategist, Sam takes the helm of all paid and organic operations teams, steering client SEO services, link building initiatives, and white label digital marketing partnerships to unparalleled success. An esteemed thought leader in the industry, Sam is a recurring speaker at the esteemed Search Marketing Expo conference series and has graced the TEDx stage with his insights. Today, he channels his expertise into direct collaboration with high-end clients spanning diverse verticals, where he meticulously crafts strategies to optimize on and off-site SEO ROI through the seamless integration of content marketing and link building.

Related posts

Samuel Edwards
|
May 30, 2025
PPC Case Study: Tampa, Florida Apartment Complex

When this apartment complex client partnered with PPC.co, their goal was clear: generate more qualified leads through Google Ads. In just 60 days—from January to March 2025—we transformed their paid acquisition performance. Total conversions more than tripled, jumping from 10 to 32, while the overall conversion rate soared by over 300%. At the same time, we drove down the cost per conversion by 44%, delivering significantly more leads at a much lower cost. 

By strategically combining Performance Max and high-intent Search campaigns, we not only increased lead volume but improved overall efficiency and ROI. This rapid and measurable improvement underscores the value of data-driven optimization and expert campaign management.

January 2025

March 2025

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Campaign Analysis Summary

January 2025

  • Total Ad Spend: $498.63

  • Total Conversions: 10

  • Cost per Conversion: $49.86

  • Overall Conversion Rate: 1.12%

  • Campaigns Active:

    • Performance Max (PMax):

      • Conversions: 10

      • Conversion Rate: 1.12%

      • Cost per Conversion: $49.86

    • Search Campaign: No conversions or spend.

March 2025

  • Total Ad Spend: $898.54

  • Total Conversions: 32

  • Cost per Conversion: $28.08

  • Overall Conversion Rate: 4.64%

  • Campaigns Active:


    • Performance Max (PMax):


      • Conversions: 19

      • Conversion Rate: 3.74%

      • Cost per Conversion: $27.39

    • Search Campaign:


      • Conversions: 13

      • Conversion Rate: 7.14%

      • Cost per Conversion: $29.08

Strategic PPC Campaign Insights

  • Performance Max Improvements:

    • Conversions almost doubled (10 → 19) with just a 4.4% increase in spend ($498.63 → $520.45).

    • Cost per conversion was nearly cut in half ($49.86 → $27.39), showing better algorithmic targeting or improved creatives/landing page experience.

    • Conversion rate rose from 1.12% to 3.74%, indicating better audience alignment.

  • Search Campaign Activation:

    • Was inactive in January.

    • Delivered strong performance in March with a 7.14% conversion rate and 13 conversions at a very competitive $29.08 cost per conversion.

    • High interaction rate (7.65%) shows strong ad engagement and search intent alignment.

What’s the path going forward? 

  1. Continue Campaign Diversification:

    • The dual strategy of running both PMax and Search campaigns is proving effective. Continue scaling with both to diversify reach and conversion sources.

  2. Increase Budget Strategically:

    • Given the efficiency improvements (43.7% drop in cost per conversion), consider increasing the budget further to capitalize on momentum—particularly for the high-performing Search campaign.

  3. Refine PMax Targeting & Creative:

    • The Performance Max campaign is performing well but has room to improve conversion rate to match the Search campaign. A/B test creatives, refine audience signals, and check landing page relevance.

  4. Track Lead Quality:

    • Ensure that higher conversion volume aligns with high-quality leads or downstream metrics like closed deals or ROI.

‍

‍

The client was thrilled with the performance. As they put it: 

‍

We’re super excited about the results! Can’t wait to see what’s to come!”

‍

Conclusion

This case study is a testament to what can happen when a well-structured campaign meets expert strategy and continuous optimization. Whether you're launching a new property or looking to boost occupancy in a competitive market, PPC.co delivers real results—fast.

Ready to grow your leads and lower your cost per conversion?
Contact us today to schedule a free audit and discover how we can help you achieve similar results.

Click on the following link if you would like to see more PPC case studies! 

‍

Timothy Carter
|
May 29, 2025
The E-Commerce & Retail Guide to Running Profitable Paid Ads

If you’re running an e-commerce or retail business, you already know that visibility is everything. The best product in the world won’t sell if no one sees it. That’s where paid ads for ecommerce comes in. 

Done right, they drive traffic, conversions, and repeat customers. 

Done wrong, they drain your budget and leave you wondering what went wrong.

Whether you’re spending $500 a month or $50,000, your goal is the same: profitability. Not just clicks, and certainly not just impressions. You want to turn ad dollars into real, predictable revenue.

So how do top-performing e-commerce and retail brands make their paid ads work? 

What are they doing that you’re not? 

This guide breaks it down step-by-step, so you can start running profitable ads with confidence.

Understand Your Business Goals Before You Spend a Dime

Before you launch a single campaign, you need clarity on your audience and goals. Are you trying to boost first-time sales? Increase average order value? Each objective requires a different strategy and metrics for success.

  • If your goal is new customer acquisition, your campaigns might be optimized for reach, clicks, or conversions. 
  • If your goal is profitability, you’ll focus more on return on ad spend (ROAS), customer lifetime value (CLTV), and cost per acquisition (CPA).

Don’t fall into the trap of launching ads just to “see what happens.” Paid media works best when it’s part of a bigger strategy. So before you log in to Google Ads or Meta Ads Manager, get specific about what success looks like.

Know Your Numbers

If you want to run profitable paid ads, knowing your numbers is the foundation of your entire strategy. Without a clear understanding of your margins, break-even points, and how much you can afford to spend to acquire a customer, you’re essentially gambling with your ad budget. 

And in e-commerce, that can get expensive fast.

Let’s start with the most critical numbers you need to know:

  • Cost of Goods Sold (COGS). This is what it costs you to produce or source the product you’re selling, including manufacturing, packaging, and shipping to your warehouse (or dropshipping fees). If you’re selling a T-shirt for $30 but it costs you $10 to manufacture and another $5 to ship, your total COGS is $15.
  • Average Order Value (AOV). AOV is the average dollar amount a customer spends when they place an order on your site. If your total revenue for a given period is $10,000 and you had 200 orders, your AOV is $50. This number helps you understand how much revenue you can expect per customer interaction – and it’s key to setting realistic ad spend limits.
  • Gross Profit Margin. This is the percentage of each sale that’s actual profit before marketing and operational costs. Using the example above, if your product sells for $30 and costs $15 to produce, your gross profit is $15, or 50 percent. If your AOV is $50 and your average product costs $25, you’re working with a 50 percent margin overall. Higher margins give you more breathing room with your ad spend.

Your break-even ROAS tells you the minimum return you need on your ad spend to not lose money. It’s calculated by dividing 1 by your gross profit margin. 

So if your margin is 50 percent, your break-even ROAS is 2.0. That means for every $1 you spend on ads, you need to make $2 in sales just to break even.

For example, let’s say you’re running Facebook Ads and spending $1,000 on a campaign. If your break-even ROAS is 2.0, you need to generate at least $2,000 in revenue to avoid losing money. Anything above that is profit. Anything below that eats into your cash.

Once you know your numbers, you can reverse-engineer your ad strategy instead of throwing money into the void and hoping for results. For instance, if your AOV is low (say $25), you might struggle to profit from ads unless you have a very low COGS or high conversion rates. In that case, you might want to:

  • Bundle products to increase AOV
  • Offer free shipping thresholds (e.g., “Free shipping over $50”)
  • Upsell or cross-sell related products during checkout

On the other hand, if your AOV is $150 and your margins are strong, you have more room to compete in ad auctions, bid more aggressively, and test multiple audiences and creatives without instantly wiping out your profit.

A lot of beginner advertisers focus entirely on immediate return from ads. That’s understandable – but short-sighted. If you’re breaking even or slightly losing on the first sale, that might still be a smart move if you’re building long-term customer relationships.

That’s where Customer Lifetime Value (LTV) comes in. If you know that your average customer places three orders a year, each worth $60, then their LTV is $180. If you spend $40 to acquire that customer with your first ad, but earn $140 more over the next 12 months, that ad was extremely profitable in the long run.

Top e-commerce brands build their paid strategies around LTV-to-CAC ratio – how much they earn over time compared to what they paid to acquire the customer. 

A healthy ratio is usually 3:1 or higher. So if you’re spending $50 to acquire a customer, you want to earn at least $150 from that customer over time.

Once you understand your numbers, you can plan your ad spend with precision. You’ll know exactly:

  • How much you can pay to acquire a customer
  • How much you need to make per order to be profitable
  • What kind of ROAS you should target in your campaigns
  • When it’s time to scale or pull back

Let’s say you want to make $5,000 in profit this month, and your product has a 50 percent gross margin. That means you need $10,000 in sales. If your target ROAS is 2.5, you can spend up to $4,000 in ad spend to hit that goal. With those numbers in hand, you now have a roadmap for campaign budgeting, not just a shot in the dark.

Choose the Right Platforms for Your Audience

Every ad platform has strengths. But if you try to use them all at once, you’ll burn through your budget without learning much. Instead, pick one or two that align best with your business model and customer behavior.

If you’re selling visually appealing products like apparel, skincare, or home goods, platforms like Instagram and TikTok can deliver strong returns – especially with the right creative. If you’re focused on high-intent buyers, Google Search and Shopping Ads are goldmines. And if you’re targeting professionals or B2B retail buyers, LinkedIn may offer surprising results.

Test channels strategically. Start with the one that matches where your customers spend their time and scale from there. The best platform for you is the one where your ideal customers are already shopping, scrolling, or searching.

Nail Your Targeting

One of the biggest mistakes retailers make is casting too wide a net. You don’t want everyone to see your ad – you want the right people to see it.

On Google, this means targeting high-intent keywords that signal buying behavior. Focus on terms like “buy,” “best,” “free shipping,” or product-specific searches. On Facebook, Instagram, or TikTok, you’ll want to dial in your custom audiences using demographic data, lookalikes, interests, and behavior.

Don’t forget retargeting. Most people won’t buy the first time they visit your site, but retargeting brings them back when they’re ready. Set up ads that follow people who viewed a product, added to cart, or engaged with your brand but didn’t check out.

The more relevant your targeting, the more efficient your spend and the higher your return.

Invest in Scroll-Stopping Creative

Creative is the make-or-break factor in most e-commerce ad campaigns. You can have perfect targeting and the right product, but if your ad doesn’t grab attention in the first two seconds, it won’t convert.

Your creative needs to do three things quickly:

  1. Stop the scroll
  2. Spark interest
  3. Show value

Use high-quality product photos or videos. Show your product in action. Highlight a clear benefit or solve a specific problem. Incorporate customer reviews or user-generated content to build trust.

For paid social, test multiple creatives at once – video vs. image, UGC vs. branded, short-form vs. long-form – and let performance data guide your iterations. On search platforms like Google, focus on copy that’s compelling and packed with relevant keywords. Test different headlines and descriptions to see what gets the best click-through rate.

Use Landing Pages That Convert

Sending paid traffic to your homepage is a rookie mistake. You want every click to land on a page that’s designed to convert. That means fast load times, mobile optimization, and a clear call-to-action.

If you’re promoting a specific product, send users to that product page and not your full catalog. If you’re offering a bundle or a seasonal deal, create a dedicated landing page with copy, visuals, and layout tailored to that offer.

Remove distractions. Reduce friction. Make it stupid-easy for people to buy. The less effort it takes, the more sales you’ll see. And don’t forget to A/B test. Sometimes a simple tweak to your headline or CTA can double your conversion rate overnight.

Monitor Performance

Once your ads are live, your job isn’t done. In fact, this is where it really begins. You need to monitor performance regularly, looking at more than just the surface-level metrics.

Click-through rate (CTR) tells you how well your ad is capturing attention. Conversion rate shows how well your landing page is sealing the deal. ROAS tells you how profitable your campaign is. And CPA helps you compare efficiency across different products or audiences.

Watch for early indicators of success – or failure. 

  • If your CTR is low, your creative probably needs work. 
  • If people click but don’t buy, your landing page or offer may be off. 
  • If your ROAS is negative, it’s time to adjust your targeting, bidding, or pricing.

Treat your campaigns like living systems. Tweak, test, and improve them continuously.

Scale What’s Working, Kill What’s Not

Once you find a winning combination – an ad, offer, and audience that works – it’s time to scale. Increase your budget gradually while keeping an eye on performance. Scaling too fast can tank your results, so go step by step.

Duplicate high-performing campaigns to test new audiences or creatives. Experiment with upsells, bundles, or time-limited offers to increase AOV. Layer in email or SMS marketing to retarget paid traffic and drive repeat sales.

And just as importantly, don’t be afraid to kill underperforming ads. If something isn’t working after a reasonable test period, cut it. Your budget should be flowing to what works – not what you hope will work.

Focus on Lifetime Value

One of the biggest mistakes in paid advertising is chasing one-off sales without thinking about the bigger picture. Winning e-commerce brands think in terms of customer lifetime value.

If your first sale breaks even, that’s fine. (As long as you have a plan to turn that customer into a repeat buyer. ) You can use post-purchase emails, loyalty programs, and retargeting ads to bring people back.

At the end of the day, when you view paid ads as the beginning of a customer relationship – not the end – you unlock real long-term profitability. And at PPC.co, that’s where we want to help you! We offer industry-leading PPC management services for ecommerce and retail brands who want to stop wasting ad spend and start generating real ROI.

Contact us today to learn more!

‍

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