Undermining Your Sense of Security
So you've got your website all fired up, and you've set up your Google AdWords campaign. And your website is getting visitors.... yaaaay!
You've added Google Analytics and you've set up a couple of goals so that you can track how successful your marketing efforts are being.
So far so good. Or is it?There are a number of ways in which we can track conversions - both in AdWords (using conversions) and in Analytics (using goals, events, and some of the built in indicators such as "transactions" if yours is an eCommerce site).
There are two principal ways to set up conversions in AdWords. You can configure the conversion directly in AdWords and grab the code snippet to be added to the conversion page. So, for example, let's say you have a newsletter sign up page - and once a visitor signs up they are redirected to a "thank you" page. You can add the code to this "thank you" page and this will record a conversion each time a visitor reaches that page. Since the only way to get to this page is to complete the registration - it's a good indicator.
Alternatively, you can track visits to the "thank you" page in Analytics, by turning the url for the page into a goal. A few days later this goal will become available for import into AdWords as a conversion.
Let's also suppose - for the sake of this illustration - that there is a picture gallery page for which you are keen to track visitors - as much as anything to see what kind of pictures your visitors prefer to see.
Now let's look at how these conversions are reported in AdWords. Every conversion is counted as just that - a conversion. AdWords makes no distinction between the different conversion types - hence a sign up, a purchase or a view of a key page are equal in AdWords' eyes.
This leads to a couple of considerations that can have a serious impact on your perception of your campaign performance.
Let's say you are spending $1000 a month on your AdWords campaign.
And let's suppose that this traffic resulted in 10 transactions on your website. If that conversion has been imported from Analytics into AdWords then the cost per conversion will be $100. ($1000 divided by 10 conversions)
But if you have also added AdWords conversion script to the "thank you" page, then these conversions are also being recorded. Hence these 10 sales produce another 10 conversions directly in AdWords. The cost per conversion just dropped to $50! ($1000 divided by 20 conversions)
Let's further suppose that you also had 200 visitors look a the picture gallery. All of a sudden your cost per conversion just dropped to $4.54!! ($1000 divided by 220).
So should we pat ourselves on the back and crack open the bubbly for getting our cost per conversion down from $100 to only $4.54? Not quite...
Be aware of the two biggest illusions in AdWords conversion data...
1. the duplicate conversion - where two (or more) different tracking sources are recording a single event.
2. the meaningless conversion - where the conversion has no real impact on the success or growth of your business.
Before setting up a swathe of conversions and goals, take time to define those activities visitors to your website might conduct which you truly want them to do - for the sake of your business and not just because "it would be nice". And then track those activities once and once only to get a clear picture of how much it costs to get a visitor through your sales funnel from start to finish.