Google Ads metrics: The KPIs that matter most and how to improve them

The vast amount of data that Google Ads offers can feel overwhelming if you’re not sure where to begin. But Google Ads is actually a great platform for businesses, small and large, to get started with paid advertising.

The key is knowing which metrics to focus on. Our best advice? Start with the basics, and as you get more comfortable with the platform, gradually expand your analysis.

In this article, we’ll walk through the fundamental Google Ads metrics nearly all performance marketers should track.

Navigate this post:

• The most important Google Ads metrics to follow
• Tips to optimize your Google Ads performance
• How to analyze and share Google Ads data

1. Impressions

What it is: How often your ad appears on a search results page or website.

Why it matters: Impressions tell you about your ad’s reach and effectiveness. A high number of impressions means your ads are reaching a broad audience, and low impressions indicate your ads aren’t performing well, possibly due to a blocking issue or ineffective targeting.

How to improve it: Consider increasing your campaign budget, which influences ad visibility. You can also raise your bid or improve your ad quality by targeting more relevant keywords, for example.

2. Clicks

What it is: How many times people clicked on the link to your ad.

Why it matters: Clicks tell you if your ads are engaging. Getting more clicks can mean your ads are resonating with the right audience. If you’re getting many impressions but few clicks, it means something isn’t working—your targeting may be off, or your ad copy might not be compelling.

How to improve it: While clicks are foundational to pay-per-click advertising, you shouldn’t rely solely on this metric to assess your ad’s performance. Look at the number of clicks in the larger context of your campaign, including the cost per click.

3. Cost

What it is: This one’s pretty self-explanatory—it’s the total amount you’re spending on your Google Ads account over a specific time period.

Why it matters: Cost is always a factor in advertising. You’re usually accountable to a budget or spending goals, so monitoring your ad budget is typically a top priority for any performance marketer.

How to improve it: Monitor the different costs in Google Ads— including cost per click, cost per conversion/acquisition, and cost per thousand impressions (more for brand awareness campaigns)—to ensure you’re staying within budget and prioritizing the most profitable campaigns.

4. Cost per click (CPC)

What it is: The amount you pay Google each time a user clicks on your ad. Your CPC is determined by your ad rank, and you only pay what’s minimally required to beat the competitor immediately below you.

Why it matters: Understanding the cost per click helps you manage your budget effectively. It’s crucial for planning spending and predicting outcomes based on spending rates.

How to improve it: With a well-optimized campaign, your CPC should ideally decline over time. However, external factors like what your competitors are doing can also affect your CPC.If you have a high cost per click, consider whether the expensive keywords are delivering sufficient results to justify the cost. If not, it might be time to reassess your bidding strategy.

5. Click-through rate (CTR)

What it is: How often users click on your ad relative to how often it’s displayed.

Why it matters: CTR measures your ad’s effectiveness and relevance. A high click-through rate means your ads are appealing to users, while a low CTR suggests your ads aren’t compelling enough to attract clicks, despite being seen.

How to improve it: You can increase your Google Ads’ CTR by improving your ad copy or targeting.

6. Conversions

What it is: How many times users perform an action based on your ad. These actions can include signing up for a newsletter, making a purchase, or installing an app—any action your business deems valuable.

Conversions are a more flexible metric that you have to set up by installing some type of tracking on your website.

Why it matters: Google Ads are typically results-driven, so having measurable outcomes to analyze against your spending or clicks is valuable.

How to improve it: When it comes to conversation tracking, less is more—focusing on one to a few key conversion points is usually sufficient. A low conversion rate might mean your landing page needs improvement, your offering isn’t compelling, or the path to conversion is too challenging for users to complete.

Before making any improvements, you need to understand the set-up and what’s happening in the background, meaning what you’re tracking, how the tracking works, and which attribution model you’ve chosen. Once you’ve got a grasp of these basics, analyzing keyword-level conversions becomes self-explanatory.

7. Search impression share

What it is: The ratio of how often your ads could have been shown versus how often they actually appeared. For example, a 75% search impression share means your ad appeared three out of four times people searched for it.

Why it matters: This metric tells you whether limitations in your budget or ad quality are preventing your ads from reaching their full potential. It also helps you decide where to allocate additional budget.

How to improve it: If your search impression share is low but your conversion rate or click-through rate remains high, you might want to increase spending in this area. In theory, you should be able to grow your results by showing up in more auctions.

8. Auction Insights

What it is: The Google Ads Auction Insights report tells you about your competitive landscape. It shows which other advertisers appeared on the search results page when your ads were displayed.

Why it matters: The auction insight report gives you a clearer picture of what potential customers see in search results and identifies your most relevant competitors. It also provides clarity on whether you’re competing in the right market segment.

How to improve it: If you find yourself appearing alongside companies you hadn’t considered competitors, it’s a sign to reassess your targeting and keyword strategies.

On the other hand, if you’re showing up alongside companies you do consider competitors, the report lets you analyze who is most aggressive in their ad spending, how frequently they appear alongside you, and metrics like their ad position compared to yours.

Tips to optimize your Google Ads performance

Now that we’ve covered the most important Google Ads KPIs to track, here are a few tips for optimizing your campaigns to achieve your goals.

Focus on the basics

When it comes to Google Ads, focusing on the basics will always pay off. With these foundational elements in place, you’ll establish a strong starting point for your campaigns.

• Research your audience: Understand what your audience is searching for and what they expect. Tailor your ads to meet their needs and preferences.
• Establish a solid campaign structure: While there are many opinions on the ideal structure, the key is to have an ad account that is consistent and easy to manage.
• Maintain a feedback loop: Continuously analyze post-click outcomes to refine and improve your campaigns.

Once you’ve built this strong foundation, you can test what kind of bidding strategy and ad copies work for you.

Expand your analytical horizon

Instead of just focusing on one metric, look at the wider context to understand what different metrics are telling you.

While analyzing more data can make it hard to draw simple conclusions (and that might not always be your goal), it can lead to deeper insights. Look at data outside of Google Ads to see the bigger picture. Analyzing web analytics, for example, might uncover high bounce rates or low engagement on specific landing pages, and testing ad traffic on different pages could yield better results.

Get this paid channel mix template to see how different channels are driving website conversions >>

It’s also important to acknowledge that ad platform data inherently favors the platform itself. Each platform uses its own attribution models to present results in a favorable light. Comparing results across platforms like Google, Facebook, and LinkedIn can be tricky due to these differences. Instead of overly comparing ad channels, focus on understanding how they complement each other to achieve the best outcomes.

Stay curious about new features

Google regularly rolls out new features, so it’s good to stay curious about upcoming updates and how they could help your business. You can follow industry news sites, people active on social media, and agency blogs. Depending on your relationship with Google, you might also get updates directly from account reps or join training sessions and webinars for new releases.

Instead of trying to keep up with everything, focus on a few reliable sources and pay attention to developments that matter most to your business. Filtering through huge amounts of information to find the nuggets that are relevant to you is an important skill to hone.

While it’s fun to test our new features, maintain a healthy skepticism that they might not always work. Don’t abandon that strong foundation to chase after every shiny new trend.

How to analyze and share Google Ads data

Monitoring your search ads is one thing, but how can you effectively communicate your findings in a way that resonates with internal stakeholders and clients? We’ve got a couple pointers for creating actionable PPC reports.

Show the business value of advertising

Different industries vary in how well ad performance correlates with their overall business goals—whether it’s increasing website traffic, generating leads, or driving conversions. For ecommerce, metrics like direct sales directly reflect ad success, but in B2B sectors, this connection can be more complex.

Pinpoint your most relevant goals and incorporate them into your PPC reporting to ensure your advertising supports your business objectives. Again, this often means looking beyond Google Ads data and using web analytics to understand how this one channel plays into your overall traffic acquisition and goal set-up.

One of the easiest ways to pull all the data you need in a presentable format is with Looker Studio (formerly Google Data Studio), a free tool that lets you create interactive dashboards. And our Google Ads report template makes the process as painless as possible.

Get this Google Ads overview template >>

Use the data to tell a story

To effectively share your findings, translate key Google Ads metrics into insights that stakeholders who are less familiar with the field will understand. Explain what they’re telling you as a performance marketer, including:

• What do changes in the metric mean?
• Why is it important to understand?
• What can we learn from it?

Instead of just presenting numbers, like “We got 50% more clicks,” explain the reasons behind these changes, like “We got 50% more clicks as a result of writing better ad copy, which means that this type of messaging resonates better with our audience.”

Marketers should be storytellers: Go beyond the numbers and turn those complex insights into compelling narratives.

Additional resources: How marketers can master data storytelling and visualization with Lea Pica

Over to you

The purpose of tracking Google Ads metrics is to assess the success of your advertising efforts—what’s working well and what needs a boost. Now that you know the fundamental metrics to track and how they relate to your campaign performance, you’re well-equipped to identify areas for improvement and make more informed decisions to optimize your advertising efforts.