Understanding the key indicators of your digital campaigns performance is crucial for anyone working in PPC. The goal of every single advertising campaign should be matched to different KPIs during the campaign planning phase. Proper measurement of your campaign performance is the only way to demonstrate ROI. Here are the most important PPC metrics to be in use.

Number of Clicks

Conversions always start with clicks. That’s why clicks are an early indicator of PPC campaign success. This shows how many people clicked your ad.

Click-Through Rate (CTR)

CTR is a key metric for digital campaign performance. CTR is measured by dividing the total number of clicks you got per month (or another period) by its total impressions. This equation tells you that out of say 5,000 impressions, your ad was clicked 500 times and your CTR is 10 percent.

Cost Per Click (CPC)

Normally PPC specialists have a predetermined budget for advertisement campaigns. However, while they specify a budget and a bid when doing the setup of a PPC campaign, it doesn’t mean that this is exactly what they will pay. Advertisers outcompete competitors for ad positions with their bid but pay the next highest bid price. The cost of putting up an ad and for the clicks it generates is largely determined by other competitors in the PPC auction. CPC measures exactly how much an advertiser has paid. You can define CPC by dividing the total cost of a campaign by the number of times the ad was clicked.

Cost Per Acquisition (CPA)

Google defines the average CPA as the price advertisers pay for every new customer they got, which is calculated by dividing the total cost of conversions by the number of conversions. Advertisers can also make use of Targeted CPA, which helps advertisers set bids automatically to get as many conversions as possible.

Conversion Rate (CR)

You can measure the conversion rate in Google Ads by dividing the number of conversions the campaign received by the total clicks. While campaign managers always have an eye on conversions, they will often set up campaigns to optimize for clicks rather than conversions.

Average Position

Average position tells advertisers which position their ad is shown in most of the time. Google can’t simply give the highest bidder the first position all the time, so they determine average position based on ad rank. Ad rank is calculated by multiplying Quality Score by an advertiser’s max cost per impression (CPM).