Overview

In today’s post, I will describe what Conversion Tracking is, and why it is so vitally important for running profitable online advertising campaigns.

Recall from my last post that Profit Maximization required measuring different profit levels at different Max CPCs (Cost Per Click) and then settling down on the Max CPC which yielded the most profits.

The important thing to realize that you can set a different Max CPC for every keyword!

Tying a Conversion back to the Keyword

Let’s assume that your Google AdWords ad campaign:

1)      is profitable after subtracting out advertising costs

2)      has 100 keywords that have been bid on.

Now, what if 80 of those 100 keywords are profitable, and the remaining 20 are losing money?   You may still be profitable overall, but it is imperative that you find the 20 that are losing money and take specific action on those 20 to increase your profitability further.

For Google AdWords, when you install the Google Conversion Tracking code on the “conversion page” (the page that signifies that a conversion occurred, e.g. the “Thank you for your order” page, or the “Thank you for contacting us” page), Google knows which keyword search eventually led to that conversion.  In the AdWords reports, Google will clearly show how individual keywords are doing in terms of eventually leading to conversion (and not just clicks).

Acting on Conversion Tracking data

Once you have installed Conversion Tracking, you can now see which keywords are actually generating the profits for you and which aren’t.  This granular level of detail enables you to take action at a keyword level to increase your profitability.

This concept is so simple and yet so powerful that you simply must install Conversion Tracking from “day 1” in every Ad Campaign you run online.

In my next post, we’ll talk about writing good ad copy and testing ad copy in an A/B testing framework.

Written by Nadir Hussain, COO, Media Flint, Inc. Nadir Hussain is an Internet Advertisement and Search Engine Marketing expert. He is both Google and Yahoo certified for their Internet Advertisement programs.  He teaches an Internet based Advertising class both at UC/Berkeley Extension and the Continuing Studies Program at Stanford University.  His education comprises of a Bachelor’s degree in Computer Science & Mathematics from UC/Santa Cruz, a MSEE from Stanford University and an MBA from UC/Berkeley.