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conversion 1/click vs many/click: How to decide which to use?

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

"Many /click" reporting seems to me to be intuitively the right choice. However, I've been told I should use 1/click reporting which produces significantly worse results. How can I tell which is the correct choice and, most importantly, why?

 

Thanks,  Alan Lethers

2 Expert replyverified_user

Re: conversion 1/click vs many/click: How to decide which to use?

Top Contributor
# 2
Top Contributor

Hi Alan,

 

It's pretty much a question of taste that's why both are options in the interface reports. Basically 1/click is often more associated with your direct objectives while many/click has more to do with ROI which is your ultimate metric. My vote would be for the bottom line ... hence for many/click.

 

Best,

Lakatos

Re: conversion 1/click vs many/click: How to decide which to use?

Top Contributor
# 3
Top Contributor

Hi Alan,

 

When looking at the conversion numbers and analysing the succes of your campaign you really need to look at both of these figures. The one per click figures will help you calculate acquisition costs vs. revenu for the first sale.

 

But the value of the new customer does not stop there. It is useful to know if there were repeat transactions within 30 days of the original AdWords click. That is revenue that you (probably) would not have had without AdWords. So, in my view, that is absolutely relevant. In addition to that, it is also very useful to know or estimate the lifetime value of a new customer, and that value is likely to vary by source. AdWords can't track that far, only for 30 days.

 

Look at it this way: I spent X dollars to get a click, that click produced Y dollars in revenue on the first sale. If X  is less than your profit margin on a sale o Y dollars, you might be tempted to give up. But, if there is a second purchase within 30 days, that same customer becomes profitable for you. And, if you know you can expect an average of Z orders within the next 6 months, that advertising campaign you may have given up on has become very profitable for you.

 

To summarize: Look at both! (Assuming you are selling stuff as your conversion)

 

Best of Luck!

 

Pete

 

petebardo -- Deadhead doing AdWords

Re: conversion 1/click vs many/click: How to decide which to use?

Explorer ✭ ✭ ☆
# 4
Explorer ✭ ✭ ☆
It really boils down to what your business model and objectives are. We look at both metrics because we are able to track sales through ecommerce tracking. This has been a bit tricky when it comes to doing adwords campaigns for clients that do not have a shopping cart and are relying on form submission and phone calls. Of course there is metrics available that allow you to change phone numbers based off of the traffic source but sometimes clients are unwilling to pay for that type of service. Again, it just depends on your business model and what works for you.