Metrics are units used to measure something. Common everyday examples include grams for weight, meters for distance, and so on. In Google Ads, there are 8 metrics most commonly used: impressions, clicks, conversions, cost, CTR, Conversion Rate, CPC, and Cost per Conversion.
These metrics can be used as KPIs (Key Performance Indicators) to measure and evaluate campaign performance. Let’s break them down one by one!
Impression
An Impression is a metric used to measure the number of times your ad is shown. An impression is counted whenever an ad appears to a user, whether on the SERP (Search Engine Results Page), Google Maps, or other channels.
- As a KPI: Impressions are used to measure ad relevance to the target audience or to promote brand awareness.
- Key Question: “Are many people searching for or seeing the ad?”
Click
A Click measures the number of times an ad is clicked. A click occurs when a user is interested in the displayed ad and selects it. Each click is counted as 1 point by Google Ads.
- As a KPI: Clicks serve as the primary “benchmark” for other metrics like CTR and CPC, which will be discussed next.
Conversion
A Conversion is a metric that measures a specific “Conversion Action.” The definition of a conversion is determined by the advertiser based on the context of the website and the campaign.
- Examples: WhatsApp clicks, phone calls, form submissions, transactions, etc.
- As a KPI: Conversions should ideally be defined when the campaign is being formulated to make the KPI easier to evaluate.
Cost
Cost is the metric representing the total amount of money spent on advertising. Google Ads operates on a PPC (Pay Per Click) system, meaning you are charged when the ad is clicked, not just when it is shown.
- As a KPI: Cost is used to measure the efficiency and effectiveness of the ads.
Click Through Rate (CTR)
Click Through Rate (CTR) is the percentage of people who clicked the ad compared to the total number of impressions.
- As a KPI: CTR measures engagement or the interaction between the user and the ad. It gauges how interesting the ad is to the audience. The higher the CTR, the higher the user interaction.
Conversion Rate
Conversion Rate is the percentage of people who completed a conversion action after arriving at the landing page via a click.
- The Difference: While CTR measures how attractive the ad is, the Conversion Rate measures the performance of the landing page. Both involve clicks, but they weigh different parts of the user journey.
Cost per Click (CPC)
Cost Per Click (CPC) is the actual amount paid for each individual click. The CPC amount is determined by several factors, including your bidding system, ad relevance, keywords, and the specific industry.
- As a KPI: CPC is used to calculate the budget required for every interaction generated.
Cost per Conversion
Cost per Conversion is the total amount spent to acquire a single conversion.
- As a KPI: This metric is essential for calculating the “price” of a lead or sale. With this data, you can better estimate the budget needed to scale up or decide when to stop a campaign.
Example of Metric Calculations for Google Ads KPIs
To see how these work in a real campaign, consider the following example:
Imagine a campaign with 1,000 impressions, 10 clicks, 1 conversion, and a total spend of Rp100,000. The resulting metrics would be:
- CTR: 1%
- Conversion Rate: 10%
- CPC: Rp10,000
- Cost per Conversion: Rp100,000
Conclusion
Metrics in Google Ads are used in reports as KPIs to measure the performance of a campaign. Reports structured around these metrics serve as the foundation for evaluation—allowing you to determine whether a campaign is performing well or needs optimization.