If you\u2019re going to work in the world of pay per click (PPC), you have to get to grips with endless TLAs (three letter acronyms).<\/p>\n
Once you\u2019ve grasped the basics, you\u2019ll know all about CTR<\/acronym>, CPC<\/acronym> and CPA<\/acronym>. But there\u2019s one acronym that isn\u2019t mentioned in Google\u2019s Adwords interface, and it\u2019s the most important of the lot.<\/p>\n ROI.<\/p>\n ROI, or Return on Investment, is overlooked way too frequently. But if you\u2019re optimising a PPC campaign, there\u2019s nothing better to show you which areas of your campaigns are working, and which aren\u2019t.<\/p>\n So how do we work out ROI?<\/p>\n How to calculate ROI <\/b> ROI = (Revenue\u00a0– Cost)<\/u> This calculation gives a ratio of Revenue generated for every \u00a31 spent. Let\u2019s say you\u2019d spent \u00a31000 on Adwords and generated \u00a35000 in revenue. Your equation would look like this.<\/p>\n ROI = (\u00a35000 – \u00a31000)<\/u> This gives you a ROI of 4. So, for every \u00a31 you spent, you generated \u00a34 in revenue.<\/p>\n So\u2026 now what?<\/b> Once you\u2019ve done this, you can sort your report using the new column and get an instant insight into where your campaign is doing well, and where there\u2019s room for improvement.<\/p>\n For example, if you run a keyword report, add your ROI column and then sort it so the highest ROI is at the top, you\u2019ll easily be able to spot the best performing keywords across your whole campaign.<\/p>\n Top Tip \u2013 look for keywords where ROI is high, and then invest in boosting your average position. If the keyword is working well and has potential to generate more traffic, make sure you up your bid!<\/p>\n As you start scrolling down the list, you\u2019ll see ROI getting closer to\u00a0zero and then dipping\u00a0into negative numbers. Any keywords with a return of less than\u00a0zero \u00a0are costing you money. Pause them, lower their bids, or reassess your ad and landing page.<\/p>\n","protected":false},"excerpt":{"rendered":" If you\u2019re going to work in the world of pay per click (PPC), you have to get to grips with endless TLAs (three letter acronyms). Once you\u2019ve grasped the basics,…<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"related_service":[63],"related_industry":[],"class_list":["post-1195","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"acf":[],"card":"
\nThere are loads of ways to calculate ROI, none of which are wrong. I\u2019m going to show you how I calculate it, and what the final number means.<\/p>\n
\nCost<\/p>\n
\n\u00a31000<\/p>\n
\nUnfortunately Google doesn\u2019t give ROI as an option in its reporting interface. However, if you know your way around Excel, you should have no trouble in using the formula to create a new column in an exported Adwords report.<\/p>\n