Today in Digital Marketing - Inside Google Ads: Metrics That Matter

Starting point is 00:00:01 It is Friday, August 16th. Today, we are doing something different. We are playing a full episode of Inside Google Ads. This is the fantastic, information-packed podcast hosted by our own Google Ads correspondent, Jill Saskin-Gales. Jill worked at Google Ads for six years, so you are getting the straight goods,

Starting point is 00:00:20 not only from someone who knows what the answers are, but from someone who's on the outside now and therefore can tell you those answers. And while you're listening, be sure to sign up to get all of our episodes. Just search for Inside Google Ads in your podcast app. I'll be back at the end, but now over to Jill. This is Inside Google Ads, episode 18, Metrics That Matter. Let's dive in. Our first question comes from Drina on TikTok, and they ask, what is a good ROAS? I will put a stake in the ground to give you an answer, but let's dive into this a little first. The first thing I want to say is that there's really no good or bad metrics. Metrics are morally neutral. There's just where you are today and where you want to

Starting point is 00:01:06 get to. So the simplest answer is actually a good ROAS is one where you are profitable, where you are getting more money out of your ads than the money you're putting into ads. Let's dive in one layer deeper into what that means. So ROAS stands for return on ad spend, and it's calculated as revenue divided by cost. So in the Google Ads interface, the way you'll find your ROAS is not a ROAS column. I don't know, 3.6, what that means is for every dollar you're spending on ads, you're getting $3.60 back in revenue. If what you care about in Google ads is ROAS, you're likely going to use a target ROAS bidding strategy. Maybe not to start, but that's where you're going to want to get to because then you can tell Google, rather than caring about how much I'm spending on each click or each view, just this is the ROAS I want to get, set my bids accordingly to get me there. An important thing to keep in mind is when you set a target ROAS in Google Ads, you enter it as a

Starting point is 00:02:15 percent. But when you see ROAS reported in the conversion value divided by cost column, it is as a decimal. So a ROAS of 3.6 is the same as a target ROAS of 360%. Yes, I did once have a situation with a client where they wanted a ROAS of three, so they entered their target ROAS as 3%, which is actually 0.03, and not surprisingly, performance really tanked after that. So please don't make that mistake. I had to mention that here. But when you cite your target ROAS, it's going to affect your bids and it's going to affect how scalable your campaign is. The higher your ROAS, the less you're going to be able to scale, meaning the fewer people you're going to be able to reach. And the people you do reach are probably people who are already familiar with your brand.

Starting point is 00:02:59 Maybe heard about you somewhere else. It's on a brand search or it's on remarketing. Whereas if you accept a lower ROAS, you're going to be able to reach more people who may not be as immediately profitable in that first click. Maybe they're not going to convert right away, but maybe on a second or a third click, they'll convert, for example. So it's something to keep in mind. High ROAS does not always mean better ROAS. If your ROAS is too high, that can actually be a problem. When I was working at Google, there was one very large retailer we were working with, and the ROAS on one of their campaigns was 34. A 34 times ROAS for every dollar they put into Google ads, it got $34 out. Now,

Starting point is 00:03:37 that may seem amazing, hooray, best ROAS ever, but it wasn't. This was a brand search campaign. And even then it had such a restrictive thing on it that like, of course, if you're getting a 34 ROAS, you're only reaching the people who are already searching for your brand and ready to buy. That's not bringing incremental value to your business. So the question was, and I do want to answer Drina's question, what is a good ROAS? Beyond the, it depends and beyond the, a good ROAS? Beyond the it depends and beyond the a good ROAS is where you're profitable, I will say when in doubt, two to three X. Good ROAS, achievable ROAS with no other context. If you have no idea, that's a good starting point. But in order to get a good idea of what your ROAS should be in Google Ads, I recommend you look at your profitability to

Starting point is 00:04:23 understand what your profit margins need to be. I recommend you take into account the lifetime value of a customer, not just the value on a first purchase, and then use that to determine how much revenue you need to get back from every dollar you put into Google Ads. And our next question comes from Wooden Art on TikTok, and they ask, what is a decent impression share? I will give an answer, but first I need to say once again, there is no good or bad impression share. Impression share is a diagnostic tool, and all it means is of all the times you could have shown an ad, how often did you show an ad? So if you have an impression share of 15%, for example, that means of all the times you could have shown an ad because someone was searching for your keywords and matched your location targeting, like they were in the eligible audience.

Starting point is 00:05:12 You showed an ad 15% of the time. Doesn't mean you got a click, just you got that impression. And then it means 85% of the time you didn't show an ad, even though you were eligible to. When you're looking at impression share, it's helpful not to look at it in a vacuum. You're going to want to add those two additional columns next to it for search lost IS rank and search lost IS budget because that'll tell you for that 85% impression share you lost for your lost impression share where you didn't get the impression, why did you lose out on those impressions? Was your ad rank too low,

Starting point is 00:05:45 which means your bids were too low or your quality was too low or both? Or was your budget too low? Keep in mind though, that if you are on a maximized bid strategy, those columns, the difference between them doesn't really mean anything. But if you're on a manual strategy or a target strategy, they absolutely do mean something. Okay. So for brand search, I like an impression share of at least 80%. Because if we're advertising on our brand, right, it's because we want to be there to help the page when people are searching for us. If there's no one else competing on your brand at all, then I like even 90% plus impression share, and it should not be very expensive to get there. If we're talking about non-brand search, again, there's no good or bad, but just personally, I don't like my campaign level impression share to be less than 10%. Because like if we're going to all that effort to optimize these keywords and these ads

Starting point is 00:06:36 and settings and all that stuff, and we're not even showing an ad at least 10% of the time, it's just not worth it to me. So if your impression share is really low, again, that's not bad per se, but it's based on your targeting. So your impression share can get higher by targeting fewer keywords or fewer locations or setting other restrictions. So what is a decent impression share? It's one where you're getting enough visibility, enough impressions to justify all the effort you're putting into your ads. And if you look at your lost impression share to make sure you're not losing out by an easily fixable problem, like limited by budget when you don't need to be. Now we've spoken about ROAS,

Starting point is 00:07:16 we've spoken about impression share. There are a lot more metrics that could potentially matter to you in your Google ads results. I talk about this in both my Google Ads courses, Google Ads for Beginners and Inside Google Ads. Google Ads for Beginners is meant to be a more introductory overview to how Google Ads works. So if you have no marketing experience or minimal marketing experience, that would be the right course for you to start learning Google Ads. Whereas Inside Google Ads is going to go into much more detail and show you how to actually apply these different things in the Google Ads platform. So if you do have some marketing experience or some Google Ads experience, then you would want to start with inside Google Ads. You can find both at learn.jill.ca, that's j-y-l-l.ca, or follow the links in the episode description.

Starting point is 00:08:01 Our last question today comes from bizquick22 on TikTok, and they say, when I open the dashboard, it's just so much data. I don't know what numbers are most important to pay attention to. I'm trying to take over our Google Ads account, but it's very overwhelming. We rely on it for new customers, so I'm really scared to mess it up. The first thing I want to say, bizquick22, is you are not alone. Google Ads interface is very overwhelming. There's more than 100 different columns you could add to your report. And even more metrics you can see in the custom report editor or creating custom columns.

Starting point is 00:08:37 We're not even going to go there, okay? So the way I like to break this down is into reach metrics and efficiency metrics. And this is Jill language, by the way, okay, not Google Ads language. A reach metric tells you how much of something you got. So how many impressions, how many clicks, how much cost, how many conversions, how much revenue, those are all reach metrics. An efficiency metric tells you the rate at which something happened, like click-through rate or conversion rate, or the cost per, so your cost per click, cost per conversion, or comparing two reach metrics together, right? So your ROAS is an efficiency metric. It tells you how efficiently your cost is turning into revenue. When you're trying to analyze your metrics, I recommend looking at a reach metric and an efficiency metric together

Starting point is 00:09:25 because one doesn't make any sense without the other. And I'll give you an example why. I had someone comment to one of my posts recently, I got 100% conversion rate on my Google ads and then it went down. And I'm like, 100% okay. Here's what happened. They turned a campaign on, they got one impression, one click, and one conversion. And then shocker, after that, they got more impressions, a few more clicks, and no more conversions for a day or two. That's luck, my friends, okay? The fact that you got 100% conversion rate on one click is luck. Now, if you told me that you got 100% conversion rate on 56 clicks, I would be way more impressed, but that's not

Starting point is 00:10:07 going to happen. And so that's why you can't just give one metric without the context of another. And for a practical example, let's say that you got 10 clicks. Is that good? Is that bad? Well, if you had 50 impressions with 10 clicks, then that's a 20% click-through rate. That's really strong. Whereas if you had 10,000 impressions and 10 clicks, that's less than a 1% click-through rate. Not so strong. When you first start analyzing an account, I recommend focusing on impressions and click-through rate because those put each other in context. And then impression share is really helpful to understand how you're making a mark or not making mark on your chosen targeting. On an ongoing basis, your metrics that

Starting point is 00:10:50 matter, of course, may be different for everyone, but usually a good starting point is conversion rate, conversions or conversion value, and then ROAS or CPA, depending which makes most sense to your business. So those conversion metrics, just looking at the number of conversions alone, or even your ROAS alone isn't going to help unless you put those in context of another. And then I really like keeping conversion rate as a focus in there, because that helps us understand, are we getting the right kind of audience to our website or not from those clicks we're getting. So keep your reach metrics and your efficiency metrics in mind and analyze them together in order to really understand how your ads are performing. Now, if you take one thing away from this episode, let it be this. There are no good metrics or bad metrics, just where your campaigns are today and where you'd like to get them to.

Starting point is 00:11:45 And the way to get there is by setting goals and systematically testing new tactics until you get there. Now it's time for a new insider challenge, and then I'll share my response to episode 16's challenge, since there was no challenge during our special Google Marketing Live episode last week. Here's your challenge. Your friend, who has a business in the same industry as you, tells you that their Google Ads CPCs are under a dollar. They're not trying to brag. You just both like to talk business together and share best practices with each other. Now, your CPCs are not under a dollar. Yours are in the $3 to $5 range. You tell your friend that and they say, oh, you should fire

Starting point is 00:12:25 a Google Ads freelancer. $3 to $5 CPCs are terrible. How do you determine if they're right? How do you determine if your Google Ads are performing well or not based on this information? Now, you can participate by sending me your response for this challenge or any episodes challenge. The beauty of the Insider Challenge is there's no right or wrong answer, just an opportunity to stretch your brain on real-life Google Ads problem solving. Shoot me an email at thegoogleproatjill.ca, that's J-Y-L-L dot C-A,

Starting point is 00:12:55 or send me a voice note in my Instagram DMs. I'm the underscore Google underscore pro on Instagram. In episode 16, we talked about how budgets really work in Google Ads. So be sure to check that episode out if you haven't already. And the challenge was this. You have a new B2B SaaS startup client that wants to spend 50k a month on Google Ads for at least six months. How do you pace the budget? So here's the wide answer. Well, of course, it depends. It depends. I would lean towards front-loading the budget and then whittling down based on results.

Starting point is 00:13:29 $50K a month works out to about $1,600 or $1,700 per day, which is enough for us to really test some search, demand gen, video, different creative, keywords, audiences. I wouldn't start with PMAX, again, personal preference, because this is a brand new advertiser. I like to put the different pieces in play. And then if they work well individually, then absolutely, let's run up a PMAX campaign or a few Performance Max campaigns. But since this business is new to advertising, I like to learn on the individual standalone campaign types so that we can refine our creative and our messaging with much more data and targeting at our disposal than what you'd get in PMAX. And especially since this

Starting point is 00:14:10 is a B2B company, that can be, you know, a bit trickier. It's not necessarily lead generation, you know, a SaaS subscription software usually, but that's where I'd probably start. Now, one thing I would be really cautious of since this is startup, and since this is a subscription product, is to ensure that I'm communicating well with the founders, and we have aligned goals from the get-go. My experience with startups is that, rightly so, they can pivot quickly, they can change the product overnight, they can completely overhaul the marketing strategy at the drop of a hat. So with this kind of client, especially since they're new to ads, but probably have a lot of preconceived notions about them, I would focus hard on my client communication and education alongside my campaign management. I once had a founder say to me when I asked,

Starting point is 00:15:01 now, hey, can you send me some creative for the campaign? They said, oh, just make a hundred memes and run that as ads. Yeah, I fired that client shortly afterwards, but it was also my fault for taking them on in the first place when they had unrealistic expectations about how ads work. So what would you do? Do you like to start small and then scale up into a budget, or do you like to go big or go home? Shoot me an email at thegoogleproatjill.ca or send me a voice note in my Instagram DMs. I'm Jill Saskin-Gales, and I'll see you next time Inside Google Ads. And so there you go, a sample episode of Inside Google Ads with our own Jill Saskin-Gales. It is definitely worth adding to your podcast list. So swipe over to the podcast search page in your podcast app and look for Inside Google Ads.

Starting point is 00:15:48 That will do it for the week. Today in digital marketing is produced by EngageQ Digital on the traditional territories of the Tsunamik First Nation on Vancouver Island. Our production coordinator is Sarah Guild. Our theme is by Mark Blevis. Ad coordination by Red Circle. I'm Todd Maffin. Have a restful weekend, friends. I will see you on Tuesday.

Today in Digital Marketing - Inside Google Ads: Metrics That Matter

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