If you are new to pay per click advertising, chances are you haven’t quite grasped the lingo associated with it. You may be aware that as you bid on keywords relevant to your business, your goal is to spend as little money as possible for the highest visibility for your ads. The better the quality of your ad, the more affordable local PPC becomes for your campaigns. Click-throughs from the ads to your site are recorded to give you an idea of how well the ads perform, but there is another statistic you should study as you spend. This is the conversion rate.

What is a PPC Conversion Rate?

When an Internet user sees your ad and clicks through to your site, you have a visitor. When that same visitor performs a function on your website, such as purchase a product or fill out a form, you have a conversion. A conversion is a goal you set for your website, and as a PPC program like Google Adwords and Yahoo Search Marketing can record visits and money spent, they can be set up to track activity by all users come to visit via the paid ads. A conversion need not be an actual sale, but can record a variety of actions you wish to see accomplished by site visitors:

  • Signing up to an opt-in newsletter
  • Filling out an online form for information
  • Registering online for an event
  • Downloading a PDF document or freeware
  • Registering to a message board

As each task is completed, the conversion is recorded and your PPC management dashboard will note the conversion rate compared with the actual number of visits to your site from the paid ads. Most PPC programs will allow you to set more than one conversion goal to track for your campaigns, so you can compare which ads are more effective achieving the results you want for your site and business.

What should your conversion goal be? Consider your website and how you want it to function for you. If you sell online, most assuredly actual purchases are one goal to attain. Collecting customer information for future promotions could be another. If you run a non-profit, you may wish to track visitors who leave information or sign an online petition. Only you know for certain what your site should do for you.

As for what is a good conversion rate, this is also dependent on the type of work and the scope of your business. A small company garnering a 1% conversion might not look successful, but if you factor how much is spent and how many ads are distributed, this small percentage could easily compare to a larger site enjoying a 6% rate. In short, as businesses have different models, so will the mark of success differ. Determine what is good for you and work from there. Hiring the expertise of a PPC management firm can help you plan a conversion goal strategy that works for you.

K. Lively