Question: How do you measure and optimize the return on investment of pay-per-click efforts?

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Answer:  Pay-per-click (PPC) advertising campaigns can generate many different results. You may be equally successful at increasing visibility on targeted keywords as you are at boosting direct sales. Developing a process to assess these results can facilitate valuable insights into the return on investment (ROI) for the effort.

First, identify and prioritize your objectives: Heightened visibility? Online sales? Qualified sales leads? Additionally, create success metrics that match the objectives: Cost per lead? Revenue generated per click? Click-through rate?

Second, collect the relevant data such as the origin of each click, cost per click, the search terms or phrases that are driving traffic to your site and the prospect’s subsequent actions. To ensure that the results are tailored to your needs, consider using a customized monitoring program.

Third, analyze the data within the context of your success metrics. For example, if you’ve defined success as a specific cost per lead, total up your PPC expenditures, divide by the number of leads generated and compare the result with your goal. Evaluate what worked best.

Fourth, make any adjustments to your program. For example, if more users convert to leads when sent to a specific landing page, steer all clicks that way.

Fifth, go back to the second step and continue the process.

Ultimately, while it’s important to constantly monitor the ROI of your PPC program, it’s just as important to tie the data into the bigger picture. PPC campaigns are most effective when used as part of a multifaceted marketing program and similarly should represent one factor within the overall ROI calculation.

Jim Grinney is a principal with 90octane, Denver. He can be reached at [email protected].

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