Tags: PPC

How to measure PPC ROI:

(Revenue - Cost)/Cost x 100 = ROI%

We know you're busy so there's a basic way to measure and report PPC ROI. In short, it's that formula, but the full explanation is below the title image.

Digital 22 analytics on screen

 

How To Measure PPC ROI

We are concerned with bottom line impact, here.

As long as you can isolate the revenue generated by conversions from your PPC campaign, you can use this formula to quickly work out your PPC ROI percentage.

 

how to measure PPC ROI diagram

 

Remember to make sure your Revenue includes only conversions arising from the PPC campaign.

It's important to define the Cost item when reporting to your bosses too; is it the cost of the campaign solely in terms of Ad Spend? Or are you including product and costs too for a full investment cost?

 

How To Report PPC ROI

How you report PPC ROI depends on how you define what forms the Cost in the formula.

It can be any of the following but be consistent and well defined when reporting;

- Based on Cost of the PPC Campaign

Cost of the campaign itself will give you Return On Ad Spend.

- Based on Cost of the Product & PPC Campaign Together

Cost of both the campaign and the product will give you the full ROI (it depends on company policy whether you should include overheads).

- As Profit Per Impression and Profit Per Click

Sometimes it's beneficial to look at your ROI in terms of impressions (number of times shown) and clicks (number of times users clicked through your ad).

This is useful for analysing which of your ads are working and which aren't. The design, copy and timing of future ads can be adjusted accordingly.

 

profit per impression and profit per click diagram

 

Boost Your Ranking As Well As Your PPC Campaigns

Alongside your paid campaigns, you can also boost your search engine ranking by following the advice in this ranking factors cheat sheet.

Follow the instructions to download it for FREE once you press the download now button.

Ranking Factors Cheatsheet

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