KPIs and Metrics of Online and Digital Marketing

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KPIs and Metrics of Online and Digital Marketing

  1. 1. METRICS AND KPIS Listed here are common metrics and performance indicators used by online marketers, affiliates and site owners to measure and optimise marketing strategies and site performance. Being able to track and report on these metrics daily is key to being on top of any online business; often it’s easy to overlook some of these when things are working well. But as soon as revenue drops, or marketing cost start to escalate, understanding these metrics will ensure activity can be optimised and tweaked for efficiency so site performance can continue to be profitable. Click Through Rate (CTR) % = Clicks / Impressions WHAT IT IS – This metric is generally used to measure the rate at which visitors are clicking through after seeing a piece of media or link to a site, for example a paid search ad, a display banner, or an email. Generally, CTR’s will vary depending on the media channel. Branded search CTR’s can be high at around 10%, whereas prospecting display banners would look more like a 1 hundredth of that at 0.1% HOW IT’S USED – It’s not wise to compare ad success across different media channels using CTR’s. However comparing CTR’s for the same media type will give indication of which creative message is encouraging the most clicks for the audience of traffic it is being displayed to. For example, for a display campaign using 4 different designs of creative, optimising which creative to show when using CTR can help to increase the clicks through to landing page. Post Click Conversion Rate (CR) % = Conversions / Clicks WHAT IT IS – This metric is used to show the portion of site traffic which is undertaking the required goal for the page or site. A conversion can mean a range of actions, the most common being a purchase, a registration, a download, a video play, a Facebook like or a twitter follow. Clicks in the above formula can be interchanged with visits depending on the source of the data. For example, Google Analytics reports on page visits. Whereas media activity more generally focuses on clicks. HOW IT’S USED – Understanding conversion rate is an important aspect of running any website, since a conversion is usually the main revenue driver. The overall day on day conversion rate is a good health indicator of any site, and peaks and troughs should be observed and acted upon. It’s also important to be able to break down conversion rates into smaller segments, typically by traffic source. The more granular you can get, the more visibility and understanding you can have on how each traffic source is performing, meaning it’s easy to take steps of optimising – ie trying to grow traffic from good converting sources, and tweaking traffic from poor performing ones. Conversion rate also plays an important part in understanding site usability. A key factor in getting visitors to undertake desired goals, is to develop a site conversion funnel which works at an optimal level. You might be seeing a great CTR and traffic volume to your site, but if your pages are hard to navigate and do not promote your product in a clear fashion, you will see a high Exit rate and low conversion rate. Post Impression Conversion Rate (PICR) % = Impression based Conversions / Impression WHAT IT IS – This metric is mainly used as another form of understanding conversions in display or email advertising. Users may be seeing ads that then influence them to visit a site at a later date, perhaps via search. HOW IT’S USED – This metric can be used in sneaky ways! For example, the performance of a display campaign can be seen to be working well even if clicks are low, by looking at PICR. However, on the flip side it can give an understanding of any uplift in conversions. Cost Per Click (CPC) £ = Marketing Cost / Clicks WHAT IT IS – Cost per click is quite literally, the amount that each ad click is costing to generate. It is a very common metric in Search advertising, and also used in display networks. CPC’s are commonly used as the bidding metric in search auctions as the maximum click price advertisers are prepared to pay, varying depending on the competitiveness and buoyancy of the market. Cost Per Acquisition (CPA) £ = Marketing Cost / # Acquisitions WHAT IT IS – This metric is a key performance indicator for understanding how much it’s costing to generate an “acquisition”. The term acquisition is just another word for conversion. HOW IT’S USED – An effect way of planning marketing budget is to know in advance how much can be spend on generating a single conversion based on the revenue as a result of a conversion. Knowing this will mean marketing budgets can be planned efficiently. Also, once campaigns are running, it is important to be able to calculate the CPA to understand what areas of the marketing plan are performing at the desired CPA levels. A point to note is that calculating the true CPA is not always a simple task, especially when a number of marketing spends are being used. Understanding which marketing costs contributed towards generating the acquisition has opened up a whole industry of marketing tracking
  2. 2. tools, and sparked much debate over conversion attribution. Overall it’s important not to be too narrow in analysing CPAs, but rather look across all touch points a user had (and their associated costs) before converting on site. Read more from one such attribution tool DC Storm. Cost Per Lead (CPL) £ = Marketing Cost / # Leads WHAT IT IS – usually used by affiliates to quote a fixed price for the cost of a lead, where a lead is some form of customer detail for example an email address or mobile number. It is also a KPI for indicating how much it is costing to generate leads for a site doing marketing to build a customer database. HOW IT’S USED – Understanding the value achievable off the back of lead is the Holy Grail for business where their models require revenue generation from a customer database. And knowing this figure can dictate (in a similar way to CPA above) how much can be afforded on generating these leads. Return on Investment (ROI) % = ( Revenue – Marketing Cost ) / Marketing Cost WHAT IT IS – ROI shows how much return is being achieved for the cost of generating the revenue. The reason it’s important to consider along with CPA is that is takes into account the amount of revenue produced. CPA does not, and therefore treats every sale with the same value HOW IT IS USED – Similarly to CPA, ROI should be used to analyse the performance of marketing spend. An ROI benchmark should be set for marketing budgets, so that activity can be quickly reviewed for it’s efficiency and suitability for the business. Email Specific KPIs Delivery Rate % = # Delivered Emails / # Sent Emails WHAT IT IS – When sending emails to large databases, not all email addresses in the list will gain delivery. The delivery rate is a measure which shows the portion of emails that were delivered out of the total emails broadcast. HOW IT’S USED – First off, it gives insight into the quality of the database being emailed. It also will give insight into the sending score of the Email sender. Large ISPs pay close attention to sender score, and will potentially block or blacklist senders that appear to be spammers. Delivery rate is the first line in understanding the efficiency of your send, and if your emails are getting into real and live inboxes. Bounce Rate % = # Email Bounces / # Sent Emails WHAT IS IT – A bounce is when an email is tried to be delivered, but does not reach the email inbox and hence “bounces” back to the sender. Bounces come in 2 main forms – hard and soft. A hard bounce is when the email is returned to the sender because the email address is invalid and does not exist. A soft bounce is when the ISP can find the email inbox, but can’t deliver it for some reason, for example the inbox is full. In general, good database hygiene should involved monitoring and filtering bounced emails out of a list. Email Open Rate % = # Emails Opened / # Emails Received WHAT IT IS – Email open rate measures the percentage of people who open an email as part of an email marketing send. Opening an email implies that the opener is interested in some way in the email, hence an email open shows positive interaction. It’s worth nothing that not all open stats will be real people, for example some email clients such as outlook have “auto open” options when the email is viewed in a preview pane. HOW IT’S USED – Email open rate is the first KPI up an email marketers sleeve for feedback on an emails ability to gain interest – and a large part of this comes down to the email subject line. So email open rate is a primary KPI for accessing the effectiveness of subject lines. Email Click Through Rate (Email CTR) % = # link clicks / # emails opened WHAT IT IS – Similar to ad CTR above, email CTR is a measure of the portion of people undertaking a desired click on a link within an email, out of all the people who opened the email. HOW IT’S USED – Email CTR indicates if the email content is encouraging and sufficient enough to get a reader to click to the desired landing page. Usually, a clear Call To Action is required to get an increase in Click Through Rate, and also the email subject line must be relavent to the actual email content. Often emails will have a number of links potentially in different places in the email. Tracking Email CTR down to each link means it is possible to assess the performance of each link, and therefore the email can be optimised to encourage maximum CTR. Unsubscribe Rate % = # Unsubscribe requests / # Emails Sent
  3. 3. WHAT IT IS – Unsubscribe rate shows the proportion of people that an email caused them to unsubscribe from the mailing list, indicating that they feel they email was irrelevant to their interests and unwanted. HOW IT’S USED – I have previously written about the importance of watching email unsub rates in relation to database management – ensuring you have a simple unsub mechanism is important, as is also ensuring that your unsub is either not too high compared to other emails sent, or does not rise due to changes in email sending strategy. Cost Per Thousand Emails (CPM) £ = ( Email Cost / Emails Sent ) x 1,000 WHAT IT IS – This is the cost of sending 1,000 emails. Revenue Per Thousand Emails (RPM) £ = ( Email Revenue / Emails Sent ) x 1,000 WHAT IT IS – This is the revenue generated per 1,000 emails sent. HOW IT’S USED – RPM is used where the goal of email marketing is to generate revenue. It is a measure that shows the revenue performance relative to the size of the send, and can be offset against the CPM to show the profitability of the email send. Display Ad Click Metrics Can No Longer Be Defended Posted by Robert M. Brecht, Ph.D. | May 15, 2012 Impressions and clicks have long dominated the metrics of online advertising. Yet these two metrics may be the least important metrics in measuring the effectiveness of any particular banner or display ad. Ad Impressions reported by ad networks simply reports the number of ads that were sent from the ad server to the user’s browser. The term is misleading because it doesn’t mean that the ad was ever seen by the user. The ad may have never rendered within the browser or may have loaded below the fold where the user could only have seen it if they had scrolled down the page. Clicks on display or banner ads are still the standard way success is measured when reporting results from online ad campaigns. It’s a logical assumption that clicks on ads that lead to pages designed to convert visitors would be the most important measure in attributing the value of a lead or sale. A study released in April by ComScore and Pretarget questions these two fundamental metrics. Over a 9 month period, Pretarget and ComScore undertook a large scale study of 263 million ad impressions across 18 different advertisers. They gathered not only typical ad reporting data such as impressions and clicks but also other data including viewability and hover data. Clicks and cookie-based conversion data were also collected for the ads served. Conversion was defined as either a purchase or a request for information. A Pearson correlation analysis of ”gross impressions,” “views” (defined as 75 percent of the pixels of an ad being visible in a browser either above the fold or after scrolling), “time-in-view,” “hover/engagements” and “total hover/engagement time,” ”clicks” and ”conversions.” The Pearson product-moment correlation coefficient is widely used in statistics to measure the strength of linear dependence between two variables. The correlation coefficient value ranges
  4. 4. from minus one to plus one (-1 to +1). A value of plus 1 denotes a direct linear relationship between the two variables while a value of minus 1 shows a direct inverserelationship between two variables (as one goes up the other goes down).Ä coefficient value of 0 means no linear correlation between the two variables. What they found should lead to a reevaluation of Key Performance Indicators (KPIs) for online display and banner advertising campaigns. The metric with the highest correlation with conversion was ad hover/interaction with a correlation coefficient value of 0.49. Viewable correlations had the second highest correlation (coefficient value = 0.35) followed by a significantly lower gross impressions correlation (coefficient value = 0.17). What should be most interesting for online advertisers is that the correlation coefficient value between the variables of clicks and conversions was 0.01! Let me repeat this finding: this study found no statistical correlation between ad “clicks” and conversions! This study, along with other studies with similar conclusions should make online advertisers change the metrics they are using. MediaMind’s “2009 Benchmark Report" released in 2010 revealed that increasing average Dwell (hover) time from 5 percent to 15 percent increased conversion rate by 45%. In another study, Casale Media’s 2011 “Ad Visibility Report” showed that ads that appear above the fold were 6.7 times more effective at producing conversions than ads appearing below the fold. It’s time for advertisers to look at their attribution models and definitions of KPIs. If you measure the success of your online advertising by looking at the last click to determine a display ad’s effectiveness you are missing the boat entirely. If you are using ad impressions as a KPI, there are better metrics to use. Advertisers and their agencies should be paying close attention to how they measure the effectiveness of their online advertising campaigns. Clicks would appear to be a poor indicator of resulting conversions. These studies bring a new dimension to the shift away from last click to multi-touch attribution modeling underway. 32 Key Performance Indicators (KPIs) for Ecommerce Performance should inform business decisions and KPIs should drive actions. Key performance indicators (KPIs) are like milestones on the road to online retail success. Monitoring them will help ecommerce entrepreneurs identify progress toward sales, marketing, and customer service goals. A performance indicator is simply a quantifiable measurement or data point used to gauge performance relative to some goal. As an example, it may be a goal for some online retailers to increase site traffic 50 % in the next year. Relative to this goal, a performance indicator might be the number of unique visitors the site receives daily or which traffic sources send visitors (pay-per-click advertising, search engine optimization, brand or display advertising, or a YouTube video).
  5. 5. For some goals there could be many performance indicators — often too many — so often people narrow it down to just two or three impactful data points known as key performance indicators. KPIs are those measurements that most accurately and succinctly show whether or not a business in progressing toward its goal. Setting Goals and Identifiying KPIs Selecting KPIs begins with clearly stating goals and understanding what areas of business impact those goals. Of course, KPIs can and should differ for each of an online retailer's goals, whether those are related to boosting sales, streamlining marketing, or improving customer service. Here are a few examples of goals and associated KPIs:  GOAL 1 — Boost sales 10% in the next quarter. KPIs include daily sales, conversion rate, site traffic.  GOAL 2 — Increase conversion rate 2% in the next year. KPIs include conversion rate, shopping cart abandonment rate, associated shipping rate trends, competitive price trends.  GOAL 3 — Grow site traffic 20 percent in the next year. KPIs include site traffic, traffic sources, promotional click-through rates, social shares, bounce rates.  GOAL 4 — Reduce customer service calls by half in the next 6 months. KPIs include service call classification, identify of page visited immediately before the call, event that lead to the call. It should be easy to see that there are many performance indicators, and the value of those indicators is directly tied to the goal progress measured. Monitoring which page someone visited before initiating a customer service call makes sense as a KPI for GOAL 4 since it could help identify areas of confusion that when corrected would reduce customer service calls, but that same performance indicator would be almost useless for GOAL 3.
  6. 6. With the idea that KPIs should differ based on the goal being measured, it's possible to consider a set of common performance indicators for ecommerce. Here are 32 common ecommerce key performance indicators. Just remember that the performance indicators listed below is in no way exhaustive. 32 Key Performance Indicators Sales Key Performance Indicators:  Hourly, daily, weekly, monthly, quarterly, and annual sales  Average order size (sometimes called average market basket)  Average margin  Conversion rate  Shopping cart abandonment rate  New customer orders versus returning customer sales  Cost of goods sold  Total available market relative to a retailer's share of market  Product affinity (which products are purchased together)  Product relationship (which products are viewed consecutively)  Inventory levels  Competitive pricing Marketing Key Performance Indicators:  Site traffic  Unique visitors versus returning visitors  Time on site  Page views per visit  Traffic source  Day part monitoring (when site visitors come)  Newsletter subscribers  Texting subscribers  Chat sessions initiated  Facebook, Twitter, or Pinterest followers or fans  Pay-per-click traffic volume  Blog traffic  Number and quality of product reviews  Brand or display advertising click-through rates  Affiliate performance rates
  7. 7. Customer Service Key Performance Indicators:  Customer service email count  Customer service phone call count  Customer service chat count  Average resolution time  Concern classification Once you have set goals and selected KPIs, monitoring those indicators should become an everyday exercise. And most importantly: Performance should inform business decisions, and you should use KPIs to drive actions. The 10 Marketing KPIs You Should Be Tracking Estimated Reading Time: 5 minutes When it comes to setting and tracking your marketing KPI's, many marketers and business owners are fully aware of the usual suspects. Sales revenue. Leads. Cost per acquisition. But there are a number of other KPI's that you should be tracking in order to execute a more successful marketing campaign. No one wants to support a marketing activity that's losing their company money. By tracking the right marketing KPI's, your company will be able to make adjustments to various strategies and budgets. Without the right KPI's, your company might be reporting and making decisions based on misleading information. In addition to this article, we've also detailed how to fix the 6 critical marketing KPIs your boss actually cares about here. The 10 Most Important Marketing KPI's to Track
  8. 8. 1. Sales Revenue How much revenue has your inbound marketing campaign brought your company? Understanding your sales revenue is important to know how effective your inbound marketing campaign is, no company wants to spend money on something that isn't generating money. For the moment think of inbound marketing as pay per click, if your sales revenue from direct mail was less than the money you spent for that campaign, why would you continue using direct mail? Most likely you would move that money to other marketing activities. To determine your sales revenue from inbound marketing you would have to define what you mean by inbound and outbound marketing. Inbound marketing activities include:  Developing premium content  Podcasts  Blogging  Infographics  Social Media Engagement  Pay Per Click Outbound marketing activities include:  Direct mail  Television ads  Advertising  Telemarketing Another critical element is capturing sales data directly via your CRM integration and closed loop reporting. You can calculate your sales revenue from inbound marketing by utilizing the following calculation. (Total sales for the year) - (Total revenue from customers acquired through inbound marketing) 2. Cost Per Lead Not only do you want to calculate your customer acquisition costs for inbound marketing, but outbound marketing as well. How much is it costing you to acquire a customer through inbound marketing versus outbound marketing? When calculating your customer acquisition costs, it requires the integration of your marketing automation and CRM platforms as well as accounting for all relevant costs associated with ERP integration. Calculating CAC for inbound marketing, relevant costs include:  Manpower (creative and technical)  Technology and software  General overhead Calculating CAC for outbound marketing, relevant costs include:  Advertising  Marketing distribution  Manpower (sales and marketing)  General overhead Once calculating the costs associated with your inbound and outbound marketing campaigns, you can directly account for new sales, as well as allocate particular budgets for each campaign. If
  9. 9. you company is utilizing mostly inbound marketing, you can break down that component further by campaign types assess how successful and profitable each activity is. 3. Customer Value With inbound marketing, there is no better way to reach out to your current customers. Not only can it help you keep in contact with leads, but it also helps reduce churn and expand your customers lifetime value. You can calculate the lifetime value of your customers by utilizing the following calculation: (Average sale per customer) X (Average number of times a customer buys per year) X (Average retention time in months or years for a typical customer) A great way to increase the lifetime value of your customers is by developing lead nurturing campaigns that reach out to existing customers. Providing you and your sales team the opportunity to inform existing customers about new services, products and resources. 4. Inbound Marketing ROI Every company wants to see their return on investment! Calculating your inbound marketing return on investment is huge to help assess your monthly and annual performance. Equally important is the ability to start planning strategies and budgets for the following year or even months. No matter what marketing activity your company is using, your return on investment will determine the future with that activity. You don't want to continue adding money or increasing your budget for a marketing activity that is costing your company money. 5. Traffic to Lead Ratio Understanding your website traffic, especially knowing where your traffic is coming from, whether it's organic, direct, social media or referrals is extremely important. Is your trafficcontinually increasing or is it dropping? Not only do you need to ensure that your traffic is meeting the goal you set for the month, but also make sure your visitor to lead conversion rate is between 2 to 4 percent. 6. Lead to Customer Ratio After all of your marketing efforts, it's important to know how many leads your sales team is able to close. You will want to calculate both your sales qualified lead conversion rate and sales accepted lead conversion rate. What's the difference between the two?  Sales Qualified Leads are leads considered to be sales ready based on their lead score or specific activities/triggers they completed. Most companies would consider a lead who filled out a form,
  10. 10. such as "contact a rep" a lead who is ready to buy your service or product. For example, a waste management company with a lead who filled out the form "rent a dumpster", would be considered a sales qualified lead.  Sales Accepted Leads are leads your sales team considers opportunities, and have either contacted the lead directly or a scheduled call. This marketing KPI is extremely useful for sales and marketing to help determine how successful their campaigns are. Ask yourself the following questions:  Is my campaign capturing leads?  Is our CRM successfully passing qualified leads to sales at the right time?  Do you have high close rate? 7. Landing Page Conversion Rates Is your content generating conversions? A great well to tell if your landing pages are converting visitors is to see how many people are visiting each landing page and identifying how many of those visitors are completing your lead capture forms. One reason people might not be converting is your content! Are you creating remarkable content that will make your visitors convert into leads? If your landing pages aren't generating conversion rates around 10-20% you might need to edit your content. Another great way to increase conversions would be to optimize your landing pages and call to actions by performing A/B tests. 8. Organic Searches What percentage of your traffic is from organic searches? The traffic to your site generated by organic searches can be directly correlated with your search engine optimization strategy. Some great metrics to help you identify where you organic search traffic is coming from include:  Number of lead conversions assisted by organic search  Number of customer conversions assisted by organic search  Percentage of traffic associated with branded keywords  Percentage of traffic associated with unbranded keywords Those are four really great metrics to help your company gain a better understanding of your brand awareness, content marketing effectiveness, as well as the impact of your SEO strategy.
  11. 11. 9. Social Media Reach You might be wondering what your social media reach and engagement have to do with your marketing KPI's. Well, social media is a huge component of your inbound marketing strategy, allowing you to engage and share content with users. You can show your senior management team the value of social media through the growth and engagement of your social media profiles. Social media engagement can include anything from likes, comments, retweets, shares, mentions and many more. Metrics you can utilize to show the importance and impact of social media on your marketing efforts include:  Number of lead conversions assisted by each social media channel  Number of customer conversions generated through your social media channels  Percentage of traffic associated with social medie channels With social media sites like Twitter, Facebook, LinkedIn Google+, Pinterest and Instagram you might not have all the time in the world to effectively utilize every platform. Break down the number of leads, customers and percentage of traffic coming from each platform. Why would you spend 10 hours a month engaging and interacting on Google+ when 55% of your traffic generated through social media is coming from LinkedIn? 10. Mobile Traffic, Leads and Conversion Rates You cannot forget the increasing amount of traffic, leads and customers being produced through mobile devices like Smartphones and tablets. Is your website effectively optimized for mobile? One way you can tell if your company is generating traffic and leads through mobile is to calculate the following metrics:  Number of lead conversions from mobile devices  Bounce rates from mobile devices  Conversion rates from mobile optimized landing pages You don't only want to see how many visitors are converting through mobile but you also want some indication of how effective your mobile presence is. Understanding Key Performance Indicators (KPIs) – Complete Guide Analytics 66 inShare What I am going to do next is, explain KPIs to you in a way that is instantly useful and I am planning to make you a KPI Champion in just 10 minutes What is a KPI? KPI stands for ‘Key performance Indicator’.
  12. 12. It is a metric which is used to determine how you are performing against your business objectives. A metric can be a number or a ratio. So we can have ‘number metrics’ and we can have ‘ratio metrics’. For example: Visits, Pageviews, Revenue etc are number metrics because they are in the form of numbers. Bounce rate, Conversion rate, Average order value etc are ratio metrics because they are in the form of ratios. Since KPI is also a metric, we can have KPIs in the form of numbers and ratios. So we can have ‘number KPIs’ and we can have ‘ratio KPIs’. For example: Days to purchase, visits to purchase, Revenue etc are number KPIs. Conversion rate, Average order Value, Task completion rate etc are ratio KPIs. Difference between a Metric and KPI A metric graduates to KPI. However in order to make this happen the metric must hugely impact the business bottomline. This is possible only when the metric has the ability to provide recommendation(s) for action which can a huge impact on the business bottomline. So Your KPI must have the ability to provide recommendation(s) for action which can hugely impact the business bottomline. For example, ‘Average Order Value’ can be used as a KPI because it hugely impacts the business bottomline. You can greatly increase sales at the present conversion rate just by increasing the size of the orders. Revenue per click, Revenue per visit, Revenue per acquisition, Cost per acquisition, Task completion rate etc. are other examples of metrics which can be used as KPIs. How to find a good KPI? 1. Before you start the process of finding KPIs, you must acquire a very good understanding of your business and its objectives. 2. Then you need to translate your business objectives into measurable goals. 3. Once you have determined your goals, you will select KPIs for each of these goals. You will use these KPIs to measure the performance of each goal. Goals are specific strategies you used to achieve your business objectives. Your business objective can be something like ‘increase sales’. Your goal could be something like ‘increase sales by 5% in the next 3 months by increasing the average order value from x to 2x’. Any metric which has the ability to directly impact the cash flow (revenue, cost) and/or conversions (both macro and micro conversions) in a big way can be a good KPI. For example if you sell display banner ad space on your website and display advertising is the main source of revenue for you then ‘pageviews’ can be used as a KPI. The more pageviews you get, the more you can charge for every thousand impressions (CPM) from your advertisers. If you are not sure whether or not a metric can be used as a KPI, then try to correlate it with revenue, cost and/or conversions over a period of time (3 or more months).
  13. 13. You need to prove that there is a linear relationship between your chosen KPI and revenue, cost and/or conversions i.e. as the value of your KPI increases or decrease there is a corresponding increase or decrease in revenue, cost and/or conversions. Can you use ‘number of twitter followers’ as a KPI? The answer is ‘NO’, not unless you can correlate number of twitter followers with revenue, cost and/or conversions i.e. as the number of twitter followers increases or decreases there is a corresponding increase or decrease in revenue, cost and/or conversions. Even if somehow you are able to correlate the number of twitter followers with revenue, cost and/or conversions you still need to prove that the correlation has huge impact on the business bottomline. Just because a metric impacts the business bottomline, does not automatically make it a good KPI. Can you use ‘number of facebook fans as a KPI? The answer is ‘NO’, not unless you can correlate number of facebook fans with revenue, cost and/or conversions i.e. as the number of facebook fan increases or decreases there is a corresponding increase or decrease in revenue, cost and/or conversions. Even if somehow you are able to correlate the number of facebook fans with revenue, cost and/or conversions you still need to prove that the number of facebook fans has huge impact on the business bottomline. Just because a metric impacts the business bottomline, does not automatically make it a good KPI.
  14. 14. Can you use ‘Phone Calls as a KPI? The answer is ‘yes’ provided majority of your revenue comes through Phone calls. You can easily track phone calls through ‘phone calls tracking’ software and then import phone calls data into Google Analytics. Once the data is imported you can tie phone calls to revenue, cost and/or conversions to determine correlation. Here there is one thing to keep in mind. A KPI doesn’t need to be a metric available in Google Analytics reports. You can use metrics from other analytics tools too. For example ‘Phone call’ metrics is not available in Google Analytics reports by default but this doesn’t mean that we can’t use it as a KPI. Similarly, ‘Task completion Rate’ metric is not available in Google Analytics reports. However you can calculate ‘Task completion Rate’ through a survey tool like Qualaroo and use it as a KPI. Task completion rate is the percentage of people who came to your website and answered ‘yes’ to this survey question: “Were you able to complete the task for which you came to the website?” Can you use Clients’ Happiness as a KPI? The answer is ‘NO’. This is because a KPI is a metric and metric is a number or a ratio. In other words, metrics is something which can be measured in the first place. How you can possibly quantify a human emotion like ‘Happiness’? Types of KPIs There are two broad categories of KPIs: 1. Internal KPIs 2. External KPIs Internal KPIs These KPIs are internally used by team members to measure and optimize their marketing campaigns’ performance. They are not always reported to clients/boss/senior management. Internal KPIs don’t need to be business bottomline impacting either. For example following KPIs can be used to measure your link building outreach campaigns: 1. Delivery Rate 2. Open Rate 3. Response Rate 4. Conversion Rate of outreach 5. ROI of outreach Often marketers make this terrible mistake of reporting internal KPIs to clients/senior management.
  15. 15. For example ‘Bounce Rate’ is a good Internal KPI for optimizing landing pages. But it is not something which you will report to a CEO. We report only hugely business bottomline impacting KPIs to senior management. Related Post: How to become Champion in Data Reporting External KPIs These are the KPIs we report to clients/senior management and use them to create ‘Web Analytics Measurement Models’ (strategic roadmaps) for businesses. External KPIs must be hugely business bottomline impacting. Whenever we talk about KPIs in general, we are referring to external KPIs. Some examples of external KPIs: 1. Average Order Value 2. Conversion Rate 3. Revenue 4. Revenue per acquisition 5. Cost per acquisition 6. Task Completion Rate 7. Goal conversions Note: External KPIs can also be used as internal KPIs. There is no hard and fast rule here. Attributes of a Good KPI A Good KPI has following attributes: 1. Available and Measurable You can use only those metrics as KPIs which are available to you in the first place. For example if ‘Net Promoter Score’ metric is not available to you then you can’t use it as a KPI. Similarly if you come up with something which is impossible to measure (like ‘frustration level of customers who abandoned the shopping cart for the 3rd time’) then you can’t use it is as a KPI. So when you are finding your KPI, you need to be 100% sure that there is a mechanism/tool available out there to measure and report your KPI in the first place. 2. Hugely business bottomline impacting If a metric does not greatly impact the business bottomline then it is not a good external KPI. 3. Relevant If your KPI is hugely business bottomline impacting then it is got to be relevant to your business objectives. Conversely, if your KPI is not relevant to your business objectives then it can’t be business bottomline impacting either. 4. Instantly useful If your KPI is hugely business bottomline impacting then it is got to be instantly useful i.e. you can quickly take actions on the basis of the insight you get from your KPI. 5. Timely Your KPI should be available to you in a timely manner so that you can take timely decisions. For example if you are using a compound metric (a metric which is made up of several other metrics) as a KPI and it takes several months to compute it once and then another several months to compute it second time then it is not a good KPI as you can’t take timely decisions on the basis of such KPI.
  16. 16. Examples of Good KPIs KPI Meaning Formula 1 Gross Profit It is the profit after production and manufacturing cost. Gross Profit = Sales Revenue – Direct Cost Direct cost can be something like cost of manufacturing a product 2 Gross Profit Margin It is used to determine the effectiveness of your business in keeping production cost in control. Higher the gross profit margin, more the money is left over for operating expenses and net profit. Gross Profit Margin = (Gross Profit/ Revenue) * 100 3 Operating Profit It is the profit before interest and taxes. Operating Profit = Sales Revenue – Operating Cost Operating cost is the ongoing cost of running a business, product or system. It can include both direct and indirect costs. 4 Operating profit margin It is used to determine the effectiveness of your business in keeping operating cost in control. Higher the operating profit margin, more the money is left over for net profit. Operating Profit Margin = (Operating Profit/ Revenue) * 100 5 Net Profit Also known as net income, net earnings, bottomline. It is the profit after interest and taxes. Net Profit = Sales Revenue – Total cost (this includes any direct and indirect cost + interest + taxes) 6 Net Profit Margin Also known as profit margin, net margin, net profit ratio. . It is used to determine the effectiveness of your business in converting sales into profit. Low profit margin indicates higher risk, that a decline in sales will erase the profit and result in net loss. Net Profit Margin = (Net Profit/ Revenue) * 100 7 Revenue Growth Rate Also known as sales growth rate. It is the measure of the percentage increase in sales between two time periods. Revenue Growth Rate = (Current month’s Revenue- Last month’s Revenue) / (Last month’s Revenue) * 100 8 Total Economic Value It is the total value added by your product/service/campaigns to the business bottomline. It also take into account the role played by micro conversions and conversions which assisted and completed the sales. Total Economic Value = Total Revenue+ Total value of the assisting conversions + Total value of the last click conversions 9 Return on Investment (ROI) It is used to evaluate the efficiency of your investment or to compare the efficiency of different investments. ROI= (Gain from investment – cost of investment)/cost of investment 10 Net Promoter Score It tells how likely it is that your customers will recommend your business to a friend or colleague. Click here for more details. Net promoter score = % of promoters – % of detractors
  17. 17. 11 Customer lifetime value It is the projected revenue (repeat business) a customer will generated during his lifetime. Different types of customers have different life time value (LTV). One of the best ways to boost LTV is by improving customer satisfaction. (Average order value) X (Number of Repeat Transactions) X (Average customer life span in months/years) Average customer life span means how long he/she remains your customer. 12 Customer retention rate It is used to determine how good your company is in retaining customers. Customer Retention Rate = [1- (Customers lost in a given time period/total number of customers acquired in the same time period)] * 100 13 Customer profitability score This score is used to separate profitable customers from unprofitable customers. Customer profitability score = Revenue earned through a customer – cost associated with customer’ management/service/retention 14 Cost per lead It is the average cost of generating a lead. Cost per lead = total cost/total leads 15 Cost Per Acquisition It is the average cost of acquiring a customer or generating a conversion Cost Per Acquisition = Total Cost/ Total acquisitions 16 Revenue Per Acquisition It is the average revenue earned through an acquisition Revenue Per Acquisition = Total Revenue/Total acquisitions 17 Per Visit Value It is the average value of a visit to your website. Per Visit Value = Total Revenue/Total Visits 18 Conversion Rate It is the percentage of visits which results in goal conversions or ecommerce transactions. Conversion Rate = (Total Goal conversions/ E- commerce transactions/ total visits) *100 19 Average Order Value It is the average value of an ecommerce transaction. Through this metric you can measure how effective your upselling and cross selling efforts are and whether you are helping people in finding the product they are looking for. Average order value = Total Revenue/Total ecommerce transactions 20 Task Completion Rate It is the percentage of people who came to your website and answered ‘yes’ to this survey question: “Were you able to complete the task for which you came to the website?” Task completion rate = (number of people said ‘yes’ to the survey question/ Total number of survey responses) *100 There is virtually no limit to the number of good KPIs you can find. It all depends upon the nature of the business and the industry you work in. For example if you work in an industry where majority/all of the conversions happen offline via phone calls then you can use ‘Phone Calls’ as your KPI. Read more: http://www.seotakeaways.com/understanding-key-performance-indicators-kpis-just-like- that/#ixzz31hSlO8Bv
  18. 18. Forget Click-Through Rate: 10 Metrics To Track For Display Advertising October 14th, 2013 - 12:05 amBy AdExchanger     "Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media. Today’s column is written by Sean Callahan, marketing director at Bizo and editor at Digital Marketing Remix. Digital ad spending continues to climb, with US budgets expected to reach $42.5 billion this year and grow to $60.4 billion in 2017, according to eMarketer. Despite this growth, marketers still struggle to prove their digital efforts are working. Digital advertising has been and continues to be one of the most difficult ad mediums to measure. Advertisers often feel unsure about what metrics point to success. To prove their digital investments are worthwhile, they rely heavily on measurements such as the click-through rate, which is thought to demonstrate a target audience’s interest. There’s a problem with this approach. While marketers create brand awareness at the top of the funnel and focus on educating prospects in the middle of the funnel, success is still pinned on click-through rates and other metrics that point to leads and conversion, which are historically bottom-funnel metrics. This is especially true with display advertising. With the B2B sales cycle getting longer, it’s imperative that marketers measure programs based on what they want to achieve at each stage of the funnel. This will enable them to take a true pulse of their growth and stay focused on drawing new prospects into the funnel. Using CTR to measure display ad performance may make sense for the bottom of the funnel, but it doesn’t work for the top or middle of the funnel. Here are 10 other metrics marketers can use to measure the performance of display advertising: Top-Funnel Metrics Display ads can be used as a branding vehicle. It can be just as effective as TV, but it’s more cost- effective and you can measure it more accurately.
  19. 19. Creative that is geared toward the bottom of the funnel often has strong calls to action so that, when acted upon, the user is effectively saying they are ready to move forward with your product. However, much of the audience you hit with display ads may not be aware of who you are just yet. In short, it’s equally important to deliver creative ads that focus on driving brand awareness and educating your audience. Many of these metrics depend on benchmarking, so marketers should measure, for instance, their branded search prior to a display campaign in order to gauge the lift when the display campaign is running. It’s important to note that metrics can vary from industry to industry and from company to company. The best way to gauge the performance of display ads is to measure them against your own brand’s performance when they’re not running. 1. Brand Recall: To measure the effectiveness of a branding display ad campaign, you can commission an online brand study comparing the increase in awareness of your brand among people who have seen your ad vs. people who haven’t. 2. Branded Search: Likewise, when your online advertising campaign is running, you should see a lift in the number of searches for your company or products on Google or other search engines. 3. Direct Website Traffic: This last metric is helpful to monitor for the top of the funnel. During an online banner campaign, your website analytics tools should show an increase in visitors who have typed in your brand name and arrived directly at your website. Mid-Funnel Metrics As I mentioned before, the mid-funnel is really focused on engaging and educating prospects. When running a display campaign that is focused on education, there are several metrics that will help you understand what’s working so you can keep driving prospects down the funnel. 4. Cost Per New Website Visitor: To calculate the cost of acquiring new prospects, divide your total campaign cost by the number of new visitors. This will give you the cost per new website visitor. 5-6. Page View Lift and Web Form Lift: While display ad campaigns are running, marketers should see target prospects viewing more pages on their websites and completing more forms as they download gated whitepapers and other content. The two success metrics to track to here are page view lift and Web form lift, respectively. It’s important to understand the true impact of your advertising efforts so you can identify what’s working and what’s not so you can then put more wood behind the arrow of what’s driving success. Bottom-Funnel Metrics By now you’ve gained brand awareness and have educated and engaged your prospects. It’s time to turn those prospects into leads. 7. Total Leads: Bottom-funnel display ads can drive your target audience to your website, where you can entice them to share their contact information by filling out your Web forms. The compilation of all contacts whose information you have can be considered total leads. 8. Cost Per Lead: You can also measure the performance of your bottom-funnel display ads by tabulating cost per lead, which is the number of leads divided by total cost of the ad program. 9. Opportunity Contribution: Lower-funnel display advertising should also provide a boost in opportunities that make it into your sales pipeline. This is known as opportunity contribution. 10: Revenue Contribution: Likewise, when bottom-funnel advertising is running, you should see a boost in revenue contribution and total closed sales opportunities that originated from marketing. A comScore study found that companies combining display and search advertising saw a 119% lift in attributed sales. Taking a look at all these metrics will make it much easier to get a handle on the real influence your campaign is making. When you just look at conversions, you don’t get the full picture. But by taking this full funnel approach, it puts you in a better position to nurture prospects down the funnel. What other metrics are you tracking?
  20. 20. Google Adwords Analytics – Complete Guide Analytics 18 Comments 91 inShare Google Adwords Analytics is the analysis of the marketing campaigns which run on Google Adwords, one of the most popular advertising systems in the world. If you do multi-channel marketing for your company than you simply can’t afford to ignore this paid channel. In order to get optimum results from your Adwords campaigns you must possess good practical knowledge of how Adwords works and how different campaigns, ad groups, keywords and landing pages are analyzed and optimized for traffic and conversions. Google Adwords Analytics process consists of following four phases: 1. Preparation 2. Configuration 3. Analysis 4. Recommendation Here the output of each phase provides valuable insight for the next phase. So if you skip a phase then you won’t get optimum results, from either your analysis or marketing efforts. Phase-1: Preparation Preparation is the most important phase of Google Adwords Analytics. The quality of the results that you will get later depends a lot on your preparation. Often marketers/analyst jump straight into analytics reports without doing the required preparation. Preparation is investing time and resources in understanding the business, its industry, its products, USP, short term & long term goals, competition and the target market. If you don’t understand the business, its products, goals and market then you may never know what to look at and where to look at in any analytics report. You may never know where to direct your marketing efforts and budget. In short you will have hard time moving forward in the right direction and producing optimum results through Adwords campaigns analysis.
  21. 21. In the Preparation phase we do following types of analysis by interviewing the client and by browsing the client’s website: 1. Profile Analysis – get a basic understanding of the business, its history, brand story, revenue model, USP, employee base, client base etc. 2. Products/Services Analysis – get a basic understanding of what the products/services are all about? Products cost, products range, most profitable products, least profitable products, products’ USP etc. How the products are promoted and sold. 3. Market Analysis – get a basic understanding of the target audience. Who are they, where they live, why they buy the products, best customers in terms of revenue generation etc. 4. Goals Analysis – get a great understanding of client’s short terms and long term goals (leads, sales, brand awareness, increase in market share, client retention etc). Without well-defined goals there is no optimization. 5. SWOT Analysis – determine the strengths, weaknesses, opportunities and threats for your client’s business. Determine how strengths can be maximized, weaknesses can be minimized. Determine how opportunities can be leveraged and how threats can be overcome. 6. Competitors Analysis – determine the top 3 competitors of your client and do profile, product, market, goals and SWOT analysis for each of them. The Analytics behind Google Adwords In order to get the most out of Google Adwords analytics you must know exactly how Adwords work and how different Adwords metrics are calculated. The best way of gaining this insight is to actually go out and run Google Adwords campaigns yourself for at least couple of months. If you can’t manage it, you can’t measure it. It is as simple as that. The second best way is to understand at least the key concepts behind Adwords system as outlined below. If you are an experienced Adwords user, you can skip this section and jump to the next section titled: ‘Secret to getting highest possible return on your Adwords Investment’. But there is no harm in reading few more lines. Who knows, you may learn something new. CPC, CPM and CPA Bidding options Whenever a user performs a search on Google (or its search partners), the Google run an auction for clicks known as the Adwords Auction. To participate in any auction you need to bid. Similarly to participate in Adwords Auction you need to bid on keywords. Your bid is known as the CPC (Cost Per Click) or CPM (Cost Per Thousand Impressions). In case of CPC bidding you pay for each click on your ad. In case of CPM bidding you pay every thousand times your ad is displayed. CPC bidding is suitable if you are mostly interested in getting traffic to your website. CPM bidding is suitable if your main focus is on branding, getting site visibility. In addition to CPC and CPM bidding there is one more type of bidding known as the CPA (Cost Per Acquisition) bidding. In case of CPA bidding you still pay for each click on your ad but you don’t need to manage your bids manually to get conversions. The bids are automatically managed by Google Adwords Conversion Optimizer. This type of bidding is suitable if you are mainly interested in getting conversions. Note: In order to use CPA bidding, you must have conversion tracking enabled and your campaign must have received at least 15 conversions in the last 30 days. Max. CPC, Actual CPC & Avg. CPC The maximum amount you are willing to pay for each click is known Max CPC. The actual amount you pay for each click is known as Actual CPC. The actual CPC is usually less than the Max. CPC because you need to pay only that much to Google which is good enough to rank your Adwords ad higher than the advertiser immediately below you. Actual CPC = Ad Rank of the competitor below / Quality Score of the advertiser
  22. 22. To get a sense of your actual CPC look at the Avg. CPC column in your Adwords reports. Avg. CPC is the average amount you pay for each click on your ad. Google Ad Rank Algorithm Google ranks Adwords ads on the basis of Ad Rank. It is calculated as: Ad Rank = Max. CPC Bid * Quality Score Quality Score is a factor used by Google Adwords system to determine how relevant your keyword (on which you are bidding), ad copy and landing page is to a user’s search query. It is measured as a number from 1 to 10. Higher your quality score, higher will be your ad rank and less you will have to pay for each click. Similarly higher your Quality score, lower will be your keyword’s first page bid estimate. That means it will be easier for your ad to rank on the first page of the search results if the keyword has high quality score. Here advertiser-1’s ad won’t rank as his keyword/ad’s quality score is very poor (1). Advertiser-3 has got highest ad rank (12), so his ad will get the 1 position on search results page for the targeted keyword. Advertiser-2 has got second highest ad rank (9), so his ad will get the 2nd position on search results page for the targeted keyword and so on. In order to rank higher than advertiser-3, you need to achieve an ad rank higher than 12. You can get a higher ad rank by increasing your Max. CPC bid, by improving your quality score or both. In case your Quality Score is already 10, then the only thing that you can do to improve your ad rank is increase your Max. CPC bid. Off course I have made this all very simple for you. The ad rank algorithm is much more complicated. There are three types of Quality Scores you must be aware of: 1. Quality Score of a keyword – it is used when the ads appear on Google Search Network. 2. Quality Score of Adwords ad – it used when the ads appear on Google Display Network 3. Quality Score of mobile ad – it is used when the ads appear on Mobile devices. Note: Quality score of a keyword is calculated each time it triggers an ad. The historical performance is the biggest component of Quality score. It can be historical CTR of your keywords, ads, display URLs and your Adwords account. It can also be your account past performance in a particular geo location(s) or device(s) (desktop, mobile, tablets etc).
  23. 23. The second biggest component of quality score is ‘Relevancy’. Relevancy means how relevant your keywords (on which you are bidding) are to the users’ search query and your ad copy. It also means how relevant your ad copy is to its corresponding landing page. The third biggest component of quality score is ‘Landing Page Quality’. The landing page quality is determined by: 1. How relevant your landing page is to its corresponding ad copy and the keywords you are bidding on 2. Landing page load time 3. And other factors like originality of the contents, navigability etc. Secret to getting highest possible return on your Adwords Investment If you are a beginner in Adwords and your aim is to get highest possible returns on your Adwords investment then you should consider running your Adwords campaigns on CPA bidding as soon as there are eligible for it. If you are an advanced Adwords/Analytics user, you should read the ‘Super Geeks Section’ below: If you are an advanced Adwords/Analytics user, you should avoid bidding on CPA. This is because Google Adwords use the last click attribution model. So in case of Adwords, the last click which completed the sales gets all the credit for conversion. Average PPC marketers bid only on last click keywords. These are the keywords which completed the sales. They don’t bid on first click and middle click keywords. First click keywords are the keywords which initiated the sales and middle click keywords are the keywords which assisted the sales: Different keywords (first click keywords, middle click keywords and last click keywords) work together to create a sale. So in order to get optimum results from your PPC campaigns, you need to bid on all the keywords {first click, middle click and last click keywords}. If you understand Attribution modeling you will get my point. If you wish to learn more about attribution modeling then you should read the following posts: Attribution Modeling in Google Analytics – Ultimate Guide Google Adwords Attribution – Introducing Effective Click Optimization Because of Google Adwords Last click attribution model, the CPA that you see in your Google Adwords report is not your actual cost per acquisition. It is the cost per last click conversion. So if you ignore first and middle click keywords and optimize PPC campaigns on the basis of cost per last click conversions than you won’t get optimal results and sometimes even lose money. This is because if a keyword is not completing a sale, it may be initiating a sale or assisting a sale (Always Remember That) and if you stop bidding on it because its cost per last click conversion (the so called CPA reported by Google Adwords) is too high or it is not completing any conversion then you may even lose money.
  24. 24. The very first step toward getting the highest possible return on your investment is determining your Maximum Profitable CPA (Cost Per Acquisition). It is the maximum amount you can pay for each conversion and still make profit on sale. Let us suppose that you manufacture and sell camcorders. You sell camcorders for $300 per item. Let us suppose that the total cost of manufacturing, packaging and shipping a camcorder (including sales tax and other taxes) is $200. So the amount of money you make (i.e. profit) on each camcorder is: $300-$200 = $100 Let us assume that this profit doesn’t include the cost of marketing the products via Adwords campaigns. So, Profit per Conversion (before Adwords Cost) = $100 In order to remain profitable your cost per acquisition (or cost per conversion) via Google Adwords campaign should be below $100 otherwise you won’t make any money (profit). The CPA that you will choose to target depends upon your profit margin. Profit Margin = (Net Profit/Revenue) * 100 If you operate on high profit margin then your cost per acquisition needs to be low. But bear in mind that maintaining high profit margins can result in decline in overall sales volume. This is because the aim here is to get the most profitable sales and not highest possible volume of sales. If you operate on low profit margin then you can afford high cost per acquisition. This is because the aim here is to get highest possible volume of sales and not the most profitable sales. FMCG companies like ‘Tesco’ operate on low profit margin. Since they make less profit per item, they need to sell large volume of items in order to remain profitable. Steep decline in sales volume will quickly erase their profit and result in net loss. Side note: I am not a pricing strategy consultant but according to my experience, businesses which don’t operate on high profit margins generally generate more profit than those who choose to operate on high profit margin. So whenever there is a tradeoff between profit and profit margin, I would go for profit any time of the day. Once you know your profit margin, you can decide your ‘Target CPA’ i.e. the maximum amount you are willing to pay for each conversion and still maintain your profit margin. Let us suppose that your target CPA is $20. Then $20 is the maximum amount you are willing to pay for each conversion and still maintain your profit margin. If you are a beginner in Adwords you would be using conversion optimizer. While enabling this tool you can either start with the recommended bid or specify your target CPA. If you are an advanced user you would not be running conversion optimizer and you would adjust the bids and do all the calculations manually (not exactly manually but via spreadsheet). This is because you also need to optimize for first click and middle click keywords as explained above and keep multi channels attributions into account. In any case, once you have decided your target CPA, you run the ads for as long as is your sales cycle (default 30 days) and then note down the Actual CPA. It is possible that your actual CPA exceeds your target CPA. This happens because Actual CPA depends upon the factors which are outside Google’s control like: Conversion Rate and Max. CPC bid. The conversion rate depends upon your ad copy, landing page and your brand credibility. Max. CPC bid depends on the advertising competition. Both of the factors are not exactly in Google’s control. Actual CPA = Max. CPC / Conversion Rate
  25. 25. If your actual CPA is higher than your Target CPA, then you need to tweak your Adwords campaigns in such a way that your Actual CPA is as close as possible to your target CPA (as shown in Fig.4 above). The best way to reduce your Actual CPA is to increase the conversion rate. Higher the conversion rate, lower will be the actual CPA. You also need to keep an eye on net profit and profit per conversion (including Adwords cost) Sometimes you may need to increase your target CPA (compromise on profit margins) if you profit per conversion start declining while you are attempting to bring the Actual CPA as close as possible to your target CPA. Sometimes your Actual CPA gets even lower than your target CPA while you are still making incremental profit (as shown in Fig.4 above). In such case you set up new Target CPA which is lower than the actual CPA and then again tweak the campaigns to determine the most profitable CPA. So you may need to experiment with different Target CPAs before you can find your maximum profitable CPA. Explanation of various metrics used in the table above: 1. All the metrics are for a particular ad group in an Adwords campaign. 2. Total clicks, Number of conversions, conversion rate, Max. CPC and Avg. CPC metrics are determined through Google Adwords reports. 3. Profit Per conversions (before Adwords cost), Target CPA, Actual CPA, Net profit and Profit Per conversion (including Adwords Cost) metrics have been calculated manually. 4. Max. CPC is the maximum amount you are willing to pay for each click. 5. Avg. CPC is the average amount you pay for each click. Generally avg. CPC is less than the Max. CPC 6. The Actual CPA = Max. CPC/ Conversion Rate 7. Net Profit = [{Number of conversions * Profit Per conversions(before Adwords cost)} – {Total Clicks * Avg. CPC}] 8. Profit per Conversion (including Adwords Cost) = Net Profit / Number of Conversions. Phase-2: Configuration In this phase we configure the Google Analytics and Google Adwords accounts to get all the right date for deep analysis later on. We need data and correct data before we start interpreting analytics reports. Any conclusions based on erroneous data can never produce optimum results and can even result in monetary loss. Therefore it is critical that we configure the Google Analytics and Google Adwords accounts correctly. The configuration process includes: 1. Getting administrative rights 2. Enabling conversion tracking in Google Adwords account 3. Connecting Google Adwords to Google Analytics account. 4. Enabling Auto Tagging in Google Adwords account 5. Enabling E-Commerce Tracking in Google Analytics account 6. Enabling ‘Adwords Cost Source’ settings in Google Analytics account 7. Enabling ‘Data Sharing’ settings in Google Analytics. 8. Importing Google Analytics metrics to Adwords reports. 9. Importing Google Analytics goals and transactions to Adwords conversion tracking. 10. Creating a separate profile for tracking Adwords campaigns in Google Analytics
  26. 26. Getting administrative rights You need to get administrative rights on both Google Analytics and Google Adwords account in order to work faster. Once you become account administrator it will be easy for you to make changes to the account whenever you want. Otherwise you have to depend on a “third party” every time you choose to make some changes. Enabling conversion tracking in Google Adwords account As a marketer you need to know what happens after a user clicks on your ad. Did he purchase your product? If yes, then which keyword, ad, ad group or campaign triggered the conversion? By knowing this, you will know which ads, placements and keywords lead to conversions and are worth bidding on. The ‘conversion tracking’ feature in Google Adwords can help you in getting this insight. In order to calculate theROI of your Adwords campaigns you have to enable conversion tracking in your Adwords account. Check out the following video to learn more about the benefits of conversion tracking and how to enable it in your Adwords account: Connecting Google Adwords to Google Analytics account Linking Adwords account to your analytics account help you greatly in understanding what people do after they click on your ad and land on your website. You can understand the behavior of Adwords visitors in terms of site usage (pageviews, bounce rate, avg. visit duration etc), goal conversions and e-commerce transactions. This type of insight helps immensely in optimizing ad copies, keywords and landing pages of an Adwords campaign. Check out the following video to learn connecting Google Adwords to Google Analytics account: Enabling ‘Auto Tagging’ in Google Adwords account Tags are campaign variables which are added to the end of destination URL of an ad. Through campaign variables you can send information (like source, medium, campaign name, campaign term etc) about your marketing campaign (like PPC, email marketing, affiliate marketing, display etc) to the Google Analytics server. Tagging a URL means adding campaign variable(s) to it. You can tag Google Adwords campaigns either manually or through ‘auto tagging’. However you can tag non-Google Adwords campaigns (like Bing PPC campaigns, Email marketing campaigns, Affiliate campaigns etc) only manually. When you choose to tag a URL manually, you manually add following campaign variables to the end of the destination URL of your ads: 1. utm_source – used to specify traffic source. For example: google, yahoo, facebook, bing etc. 2. utm_medium – used to specify traffic medium. For example: cpc, ppc, banner, email, affiliate etc. 3. utm_campaign- used to specify the name of the campaign. Campaign name can be a product name, promo code etc. 4. utm_term – used to specify the paid search keyword. For example: event-planning-courses, event-management etc. 5. utm_content- used to specify the ad version. For example: banner-link, text-link etc. Note: the use of the campaign variables ‘utm_term’ and ‘utm_content’ is optional.
  27. 27. When you choose to ‘auto tag’ a URL then Google automatically ads ‘GCLID’ to the end of the destination URL of an ad. GCLID stands for ‘Google Click ID’. It is a unique ID used by Google Analytics to track and display Adwords clicks in your reports. You can see the GCLID in the landing page URLs of your Adwords ads (provided the auto tagging is enabled). Example of non-tagged URL: http://www.abc.com Example of auto-tagged URL: http://www.abc.com?gclid=CLjTpNrg8NIC Example of manually tagged URL: http://www.abc.com/?utm_source=bing&utm_medium=ppc&utm_term=car- insurance&utm_content=text-ad&utm_campaign=car-insurance-promo-feb Note: You should always Google URL builder to manually tag URLs. Best Practices for Tagging URLs 1. Avoid manually tagging your Adwords URLs. Use auto-tagging instead. 2. Always use Google ULR builder and spreadsheet to tag multiple URLs. 3. Use consistent names and spellings for all of your campaign variables’ values. 4. Use only the campaign variables you need. Note: When you use ‘auto tagging’, Google automatically tags the campaign source and medium of your AdWords ads as google / cpc. Advantage of Auto tagging over manual tagging in case of Google Adwords Campaigns Google strongly recommends using ‘auto tagging’ for Google Adwords campaigns and there is a strong reason for that. When you manually tag your adwords URLs, the Adwords reports in Google Analytics show results only by ‘campaign’ and ‘Keywords’. But when you enable ‘auto tagging’, Adwords reports (in Google Analytics) show detailed information about your Adwords campaigns. You can then see results by: 1. Campaign 2. Keywords 3. Ad Groups 4. Ad Content 5. Match Type 6. Display URL 7. Destination URL 8. Keywords positions 9. Day parts etc The other benefit of auto tagging is that it saves time. You don’t need to manually tag each and every destination URL of your Adwords ads. This is a life saver esp. if your Adwords account is very big. To enable auto-tagging follow the steps below: 1. Sign in to your Google Adwords account. 2. Click My account tab > Preferences. 3. In the ‘Tracking’ section, click on the ‘Edit’ link 4. Check the ‘Destination URL Auto-tagging’ checkbox.
  28. 28. 5. Click on ‘Save changes’ button. Note: You should not use auto tagging and manual tagging at the same time. This can result in data discrepanciesin your reports. Factors which can prevent auto-tagging from working properly and how to test for issues There are several factors like third party redirects, encoded URLs and server settings which can prevent auto-tagging from working properly. These factors can cause GCLID parameter to be dropped from the landing page or generate error pages. Dropped GCLID parameter can cause Google Analytics to treat Google Adwords traffic as organic, direct or referral traffic instead of paid search traffic. So you need to make sure that third part redirects or server settings are not preventing your auto tagging from working properly. You can do this by following the steps below: Step-1: Add ‘?gclid=test’ to the end of the destination URL of your Adwords Ad. For e.g. http://www.abc.com/?gclid=test. If glcid=test is not the first parameter, then add ‘&gclid=test’ to the end of the destination URL of your Adwords Ad. For e.g. http://www.abc.com/?source=google&gclid=test Step-2: Copy-paste the modified URL into the address bar of your browser window and press enter. Step-3: If the URL of the resulting page doesn’t display ‘gclid=test’ then auto tagging is not working properly. Enabling E-Commerce Tracking in Google Analytics account In order to get ecommerce data (revenue, transactions, average value, e-commerce conversion rate, RPC, ROI and Margin) for your Adwords campaigns in Google analytics reports you need to enable E-Commerce Tracking in your Google Analytics account and add e-commerce tracking code to your order confirmation page(s). You can learn more about enabling and setting up e-commerce tracking from here. Related Post: How E-Commerce Tracking works in Google Analytics – Ultimate Guide Enabling ‘Adwords Cost Source’ settings in Google Analytics account In order to import cost data from Google Adwords into Google Analytics account, you must allow your Google Analytics account to receive the cost data in the first place. You can do this by following the steps below: 1. Sign in to your Google Analytics account. 2. Select the account and then the web property that contains the profile you want to edit. 3. Click the ‘Admin’ tab. 4. Click on the profile whose ‘Adwords Cost Source’ settings you want to enable. 5. Click on the ‘Profile Settings’ tab.
  29. 29. 6. Under ‘AdWords Cost Source Settings’, check the ‘apply cost sources’ checkbox. 7. Click on the ‘Apply’ button. Enabling ‘Data Sharing’ settings in Google Analytics In Google Analytics, your Data Sharing Setting must be set to: “with other Google products only” so that Google Analytics can share its data with Google Adwords. You can learn more about ‘Data Sharing settings’ from here. Importing Google Analytics metrics to Adwords reports Once you have linked Google Adwords and Google Analytics account, you can then add Google Analytics columns to your Adwords reports: You can do this by following the steps below: 1. Sign in to your Google Adwords account. 2. Click on the ‘Campaigns’ tab 3. Click on ‘Campaigns’ or ‘Ad Groups’ sub-tab 4. Click on ‘Columns’ drop down button > ‘Customize Columns’ 5. Click on ‘Google Analytics’ (as shown in the image above) 6. Click on ‘Add’ or ‘Add all columns’ (as shown in the image above) 7. Click on the ‘Apply’ button
  30. 30. You can now see the Google Analytics metrics in your Adwords reports. Importing Google Analytics goals and transactions to Adwords conversion tracking Not every action (conversions) that we want visitors to perform on our website can be tracked by Adwords default conversion tracking. For example, if you don’t have a Contact Us form with a “Thank You” page on your website, but have an email link instead which opens up client’s outlook email, then it can’t be tracked by default Adwords Conversion tracking. To work around this problem you need to track click on the ‘email link’ as Event Goal in Google Analytics and then import the goal from Google Analytics into Adwords conversion tracking. Once you have linked the Adwords and analytics accounts, enabled data sharing and auto tagging, you can then import Google Analytics goals to Adwords conversion tracking by following the steps below: 1. Sign in to your Google Adwords account. 2. Click on ‘Tools and Analysis’ tab > Conversions 3. Click on ‘Campaigns’ or ‘Ad Groups’ sub-tab 4. Click on the “Import from Google Analytics’ button 5. Select the conversions you want to import and then click on the ‘Import’ button Creating a separate profile for tracking Adwords campaigns in Google Analytics Filtered profile is a great way to apply advanced customization to a report without the risk of messing up the original data. Filtered profiles are most useful if your analytics account has got data sampling issues. The data that is
  31. 31. filtered at a profile level is unsampled. For example if you apply the advanced segment ‘paid search traffic’ to the ‘All Traffic’ report (so say you can determine the ‘e-commerce conversion rate’ of your paid search traffic) then your report data will be sampled. But if you create a filtered profile which shows only ‘paid search data’ then your report data will be unsampled. Note: Data sampling issues are big problem only for high traffic websites (which get more than 10 million pageviews/month) and can cause highly inaccurate reporting of metrics. Your metrics from ‘conversion rate’, ‘revenue’ to ‘visits’ could be anywhere from 20% to 80% off the mark if you have got data sampling issues. You should use enterprise level analytics tool like ‘Google Analytics Premium’ to minimize data sampling. But do remember that even GA premium cannot fully eliminate data sampling. Therefore you have to use filtered profiles regardless of the analytics tool (GA Standard or GA premium) you use if you have got data sampling issues. To learn more, check out this post: Google Analytics Data Sampling – Complete Guide Once you have a separate profile just for tracking Adwords campaigns you can do all type of report customization without the risking of messing up the original data in the main profile. For example by default Google Analytics group all Google Search Partners for Adwords (like AOL, ASK, mywebsearch etc) as google/cpc. So you will never know which Google search partner is actually sending traffic and conversions. You can fix this problem by creating and applying following two filters one after the other to your Adwords Profile (courtesy of: Brian Clifton).
  32. 32. Once you have applied these filters, wait for few hours and then go to Traffic Sources > Sources > All Traffic Report. You can now see all the Google search partners which are sending traffic to your website:
  33. 33. Phase-3: Analysis Once you have configured your Google Analytics and Google Adwords account and have got at least 4 weeks of data in your reports, you are in a position to do some serious analysis of the Adwords data. You can now analyze Google Adwords campaigns’ performance both through Google Analytics and Google Adwords reports. Let us start with Google Adwords reports in Google Analytics: Adwords Campaigns Report You can access the Adwords Campaigns report by going to Traffic Sources > Advertising > Adwords > Campaigns Through this report you can measure the performance of each Adwords campaign (and their ad groups and targeted keywords) on different types of devices: all devices, non-mobile devices, high-end mobile devices (like smart phones) and tablets in terms of: 1. Site usage (visits, pages/visit, avg. visit duration etc) 2. Goal Conversions (Goal Conversion Rate, Per visit Goal value, Goal 1 conversion rate etc) 3. E-Commerce (Revenue, Transactions, Average Value, E-Commerce Conversion Rate etc) 4. Clicks (Impressions, Clicks, Cost, CTR, CPC, RPC, ROI etc). Note: You can click on a campaign name (in the Adwords Campaign report) to check the performance of all the ad groups in that campaign. You can click on an ad group name to check the performance of all the keywords in that ad group. Through the ‘clicks’ tab you can get information about clicks and the keywords spending. Most of you are already familiar with metrics related to site usage, goal conversions and ecommerce. These metrics are pretty standard and are available in almost every Google Analytics report. But the metrics related to Adwords Cost data and ROI is unique. So let us explore these metrics:
  34. 34. Here, Visits is the number of visits from Google Adwords ads Impressions is the number of times your Adwords ads were displayed Clicks is the total number of clicks on your Adwords ads Data discrepancy between Adwords and Google Analytics reports Here one thing that you need to keep in mind that the number of clicks on your ads generally don’t match with the number of visits in your Adwords reports. Following are the reasons for such data discrepancy between Adwords and Google Analytics reports: 1. Google Adwords track ‘clicks’ whereas Google Analytics track ‘visits’ (or web sessions). 2. A single click on Adwords ad can result in multiple visits. 3. In a single visit a user can click on the same Adwords ad multiple times. 4. Google Adwords can report clicks even if the javascript, cookies or images are turned off by a visitor. Google Analytics can’t report visits in such case. 5. If the landing page of the Adwords ad doesn’t contain Google Analytics tracking code, then Google Analytics will not be able to track visits but Google Adwords can still track clicks. 6. Redirects in landing pages may prevent the Google Analytics Tracking code from being executed. In this case Google Analytics will not be able to track ‘visits’ but Google Adwords can still track ‘clicks’. 7. Google Adwords can filter invalid clicks but Google Analytics can’t filter invalid visits because of such clicks. So Google analytics will track and report visits even for invalid clicks. 8. Google Analytics treat visits from untagged or improperly tagged Ad URLs as organic visits instead of paid search visits.
  35. 35. 9. Profile filters may remove some of the ‘visits’ data from your Google analytics reports. 10. If visitors bookmark the landing page of your Adwords ad along with the GCLID parameter, then Google Analytics report visits from such bookmarks as paid search visits instead of direct visits. Cost is the total costs of clicks on your Adwords ads. CTR (or Click through Rate) is the number of times your ads were clicked/number of times your ads were displayed. So CTR= (Clicks/Impressions) * 100 Through CTR you can determine how much visible and convincing your Adwords ad is for targeted keyword and ad position. You can improve the CTR of your Adwords ad in two ways: 1. Bid for higher ad position (increase your Max. CPC) 2. Write a more convincing ad copy CPC is the average cost you paid for each click on your ad. CPC = total cost/total clicks RPC is the average revenue you generated for each click on your ad. RPC = (Total revenue generated through Adwords ads+ total goal value generated through Adwords ads)/total clicks on the ads. Note: Your RPC numbers could be all zero in your Adwords reports in Google Analytics if you have not set up Goals and Goal values and/or you have not enabled ecommerce reporting. ROI is the Return on Investment of your Adwords campaigns. It is calculated as: ROI= {(E-Commerce Revenue+ Total Goal Value) – cost}/cost Margin is the ‘Gross Margin percentage’ of your Adwords campaigns. It is used to estimate the gross profit of the Adwords campaigns. It is calculated as: Margin = {(E-Commerce Revenue+ Total Goal Value) – cost}/E-Commerce Revenue If Gross margin percentage for a campaign is 62% and the revenue generated by the campaign is $50000 then the estimated gross profit for the campaign would be: $50000 * 62% = $31000 ROI reported by Google Analytics for Adwords campaigns is incorrect as it doesn’t take into account your profit margin. So the correct ROI would be: ROI= {(E-Commerce Revenue+ Total Goal Value) * Profit Margin – cost}/cost ROI of 0% => means no profit, no loss. You spent ‘x’ and earned ‘x’ in revenue. ROI of 100% => means you spent ‘x’ and earned ‘2x’ in revenue. ROI of 1000% => means you spent ‘x’ and earned ‘11x’ in revenue. ROI of -100% => means you spent ‘x’ and earned 0 in revenue. Important Points about Negative ROI 1. It is common for brand new campaigns/keywords to show negative ROI for first few weeks. Therefore you should keep this in mind before you pause or delete your negative ROI campaigns/keywords. 2. You can assess keywords’ profitability through RPC and ROI metrics. 3. You should never assess the performance of keywords/campaigns on the basis of few clicks or few days’ worth of data as some visitors can take several days or weeks before they turn into customers. 4. Your ROI numbers can be all zeros in your Adwords reports in Google Analytics if you have not set up Goals and Goal values and/or you have not enabled ecommerce reporting. 5. Make sure that your Adwords and Google Analytics accounts are set to the same currency. Otherwise the ROI data won’t be accurate.
  36. 36. Adwords Keywords Report You can access this report by clicking on Traffic Sources > Advertising > Adwords > Keywords in Google Analytics. Through this report you can measure the performance of the Adwords keywords (i.e. the keywords you are bidding on in Adwords) and ‘Ad Content’ on different types of devices: all devices, non-mobile devices, high-end mobile devices (like smart phones) and tablets in terms of: 1. Site usage (visits, pages/visit, avg. visit duration etc) 2. Goal Conversions (Goal Conversion Rate, Per visit Goal value, Goal 1 conversion rate etc) 3. E-Commerce (Revenue, Transactions, Average Value, E-Commerce Conversion Rate etc) 4. Clicks (Impressions, Clicks, Cost, CTR, CPC, RPC, ROI etc). If you are running your Adwords on Google Display network (a network made up of millions of websites which have partnered with Google to display relevant Adsense ads on their web properties) then the keywords report will show ‘content targeting’ in the keywords column: Google Analytics group all the keywords which resulted in clicks on your ads (placed on the websites which are part of Google Display Network) as ‘content targeting’. The best way to measure the performance of the keywords grouped together as ‘content targeting’ is by selecting ‘placement domain’ as a secondary dimension: Placement domain is the website where your ads were displayed and clicked. So when you select secondary dimension as ‘placement domain’ you can determine the performance of your ads on a particular domain. Adwords Matched Search Queries Report
  37. 37. You can access this report by clicking on Traffic Sources > Advertising > Adwords > Matched Search Queries in Google Analytics. Through this report you can measure the performance of Matched search queries (keywords which actually triggered the ad) and match types (broad match, phrase match and exact match) in terms of: 1. Site usage (visits, pages/visit, avg. visit duration etc) 2. Goal Conversions (Goal Conversion Rate, Per visit Goal value, Goal 1 conversion rate etc) 3. E-Commerce (Revenue, Transactions, Average Value, E-Commerce Conversion Rate etc) This report becomes super useful when you add ‘keyword’ as secondary dimension. In this way you can determine which keywords you are bidding on and which are actually triggering the ads: Adwords Day Parts Report You can access this report by clicking on Traffic Sources > Advertising > Adwords > Day Parts in Google Analytics. Through this report you can determine most profitable Hours and Days of the week for your ads and then re-schedule your ads and adjust your bids accordingly. For example, if an ad generates significant amount of revenue during certain hours of the day say between 12 pm to 4pm, then you can raise your bids during those times. Adwords Destination URLs Report You can access this report by clicking on Traffic Sources > Advertising > Adwords > Destination URLs in Google Analytics. Through this report you can measure the performance of your Adwords ads’ landing pages in terms of: site usage, Goal Conversions, E-Commerce and Clicks. This report becomes super useful when you add ‘Landing page’ as a secondary dimension to verify whether the destination URL is taking the visitors to the right landing page. Through this report you can also measure the performance of Ad Distribution Network in in terms of: site usage, Goal Conversions, E-Commerce and Clicks. You can determine which method of distribution (Google Search Network or Google Display Network) is more effective.
  38. 38. Adwords Placement Report You can access this report by clicking on Traffic Sources > Advertising > Adwords > Placement in Google Analytics. Through this report you can determine how your ads are performing on ‘Managed placements’ and ‘Automatic Placements’ of Google Display Network. Managed placements are those websites on Google Display Network which you have manually selected to display your Adwords ads. Automatic placements are those websites on Google Display Network which have been selected by Google to display your Adwords ads. Adwords Keyword Positions Reports You can access this report by clicking on Traffic Sources > Advertising > Adwords > Keywords Positions in Google Analytics. Through this report you can determine where your Adwords ads ranked on Google SERP (Search Engine Result Page) when the visitors clicked on it and what is the impact of the ranking position in terms of site usage, goals and ecommerce. Through this report you can determine the ranking positions which deliver best performance. Conversion Metrics used in Google Adwords There are two types of conversions available in Google Adwords reporting interface: 1) Click Conversion – It is the conversion triggered through a click on an Ad. A click conversion can be Conv. (1 per click) or Conv. (many per click). Conv. (1 per click) => one click on an ad resulted in only one conversion. Conv. (many per click) => one click on an ad resulted in multiple conversions. However these conversions must have occurred within the next 30 days following the click on the ad.
  39. 39. 2) View through Conversion – It is the conversion triggered through an impression (viewing) of a display network ad that has not been clicked in the last 30 days. If a user clicks on your ad and purchase an item and signup for a newsletter then: Conv. (1 per click) = 1 Conv. (many per click) = 2 ================== If a user clicks on your ad and purchase an item then later again come back to your site by clicking on the ad again and sign up for a newsletter then: Conv. (1 per click) = 2 Conv. (many per click) = 0 ================= If a user clicks on your ad and purchase items then later again come back to your site directly and sign up for a newsletter then: Conv. (1 per click) = 1 Conv. (many per click) = 2 Competitive Metrics used in Google Adwords Competitive metrics are some of the most useful metrics available in Google Adwords. Understanding of these metrics is critical in order to optimize Google Adwords campaigns.
  40. 40. Search Impr. Share – It is the search impression share for your ads on the Google Search Network. It is calculated as: Total Impressions your ads received / estimated number of impressions your ads were eligible to receive on the Google Search Network Through this metric you can identify opportunities to get more impressions and clicks if your ads have got low search impression share. You need to make sure that you keep the search impression share as high as possible. Search Exact Match IS – It is the search impression share for your ads on the Google Search Network when the search terms matched the keywords (on which you are bidding) exactly or very closely. It is calculated as: Total Impressions your ads received / estimated number of impressions your ads were eligible to receive on the Google Search Network for search terms that exactly (or very closely) matched your keywords Through this metric you can identify opportunities to get more impressions and clicks if your ads have got low exact match search impression share. You need to make sure that you keep the exact match impression share as high as possible. Search Lost IM Share – It is the search lost impression share. It is the estimated percentage of impressions your ads didn’t receive on Google Search Network because of poor Ad rank. You need to make sure that you keep this impression share as low as possible. Display Impr. Share – It is the impression share of your ads on Google Display Network. It is calculated as: Total Impressions your ads received / estimated number of impressions your ads were eligible to receive on the Google Display Network Through this metric you can identify opportunities to get more impressions and clicks if your ads have got low display impression share. You need to make sure that you keep the display impression share as high as possible. Display Lost IS (Rank) – It is the display lost impression share. It is the estimated percentage of impressions your ads didn’t receive on Google Display Network because of poor Ad rank. You need to make sure that you keep this impression share as low as possible. Relative CTR – Through this metric you can get an idea of how your ads are performing on Google Display Network in comparison to the other ads on the same websites. It is calculated as: CTR of your ad / average CTR of others ads running on the same websites A relative CTR of 1x means that the CTR of your Display ad is equal to the average CTR of others ads running on the same website(s). Read more: http://www.seotakeaways.com/complete-guide-to-google-adwords-analytics/#ixzz31hTqrMTR
  41. 41. 20 KPIs you should monitor in Google Analytics Posted bydimitriszotoson Tuesday, October 18 at 12:51 to Marketing 15 Comments A Key Performance Indicator or KPI refers to a set of measurements reflecting the performance orsuccess of an organization in terms of progress of its goals. In this article we present the most important website KPIs from online marketing perspective and we discuss how to monitor them in Google Analytics. Most online marketing professionals, SEO engineers and webmasters have in their daily routine the monitoring, reporting and data analyzing tasks followed by decision making regarding the optimization of the performance of their websites. Within web metrics, charts and pivots lots of information can be found unveiling new ways to optimize their strategy. Nevertheless all these numbers, metrics and statistics can be confusing. Which ratios should be taken into account during the above analysis? Which are the most important stats? Many of these questions will be answered shortly since in the following lines we will discuss the importance of website goals and we will list the most important KPIs that are used to measure the defined targets. Website Goals & KPIs Setting specific and measurable goals is a vital stage before defining Key Performance Indicators (KPIs). Depending on its type, a website can have much different goals. Common goals of E-commerce sites are the increase of the number of purchases, the number of items in basket, the average transaction value etc while for content websites common goals are the increase of media consumption, subscribers, video viewers, online game players etc.
  42. 42. KPIs are:  Indicators of Success  Can be presented through rates  Require comparison  Depend on the industry and type of website General KPIs about Website 1. Conversion Rate: This ratio displays how many visitors are converted into desired actions. 2. Goals Conversion Rate: Shows how many visitors reached at least one of the goals that you have setup by using the Google Analytics service. 3. Type of Users (user defined): The User defined is a variable that helps you define specific types of users that have completed a goal or a specific action in the website (pageview, form completion etc). 4. Bounce Rate & Time on Site: These are 2 extremely useful KPIs which indicate whether your visitors find what they are looking for in your website or if they leave your site immediately. This metrics can be found in the Visitors section of Google Analytics, nevertheless it is also very useful to focus on them when you evaluate the various channels/sources of traffic. 5. Type of Sources: This is a complex report which is generated by segmenting the traffic by specific sources and mediums such as Search Engines, Referring sites, Direct, E-mail or custom campaigns. Focus not only on the total number of visitors but also on the quality of the traffic (bounce rate, time on site, transactions etc). Visibility KPIs 1. Traffic of Non branded keywords: This is the common Keywords Traffic report filtered to excludebrand name combinations. 2. Traffic generated by specific terms: The long or short tail keyword strategy can be evaluated using this segmentation. Usually the keywords traffic report that can be found in Google Analytics returns too many combinations. By using filters you can break down the keyword list and focus on the ones that contain specific terms or you can check for 2 words phrases, 3 words phrases or for terms that satisfy aspecific rule. To generate such a report, use regular expressions in the advanced filter. 3. Bounce rate per keyword: This can be found on the table of keywords traffic report. Focus on the column called “bounce rate” which shows the average bounce rate per keyword. 4. Keyword Ranking: Find your keyword rankings by using the keyword battle tool and then compare the results with the Organic traffic reports of Google Analytics to find out if your keyword selection istargeted and if your SEO strategy is successful. Focus on how much traffic you get from each top ranking keyword and see if you need to adapt/change your SEO strategy by focusing on more popular or more targeted terms.

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