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Relationshlip among CPC and conversion rate

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭
Hi kind community members,

I wonder to know why there were a very high conversion rate when we set a rich CPC and budget, but when we lowed the CPC and budget, the conversion rate decreased soon and always kept a low rate, although the ads got lots clicks. We also enchanced our landing page(the page of Google play store,we promote Andriod App on mobilephone app),however it did not work very well. So I want to know,whether the CPC will influence the quality of our promote channels,and then bring lots of low-quality clicks?I am not sure, hope someone can give me some suggestions. thank you .

Sophie
1 Expert replyverified_user
Marked as Best Answer.
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Accepted by Zee (Community Manager)
September 2015

Re: Relationshlip among CPC and conversion rate

Top Contributor
# 2
Top Contributor

Hi Sophie, welcome to the Community.

 

It's possible that the change in Conversion rate is related to your Impression share rather than directly to the CPC.  Impression share is the % of impressions your Ad received as opposed to all those it could have received and Conversion rate doesn't track in a linear fashion as Impression share decreases.  For example, if you have a Conversion rate of 10% when your Impression share is 100%, your Conversion rate is unlikely to still be 10% when your Impression share is only 50%.  There's no standard equation for working out exactly how it will fall off - it will depend upon the business - but it almost certainly will decrease.

 

This is why I always recommend that any Campaign should be run at an Impression share very close to 100% to achieve the best chance of Conversions.

 

The simplest way to think of this is to imagine that there are 100 possible impressions (potential customers) in any given day.  If you show your Ad to only 50 of them, it's possible you may not show your Ad to any of the ones who would have gone on to buy.  If you show your Ad to all 100 you may not make a sale, but at least you then know that you had the best possible chance of doing so, and can adjust your Campaign(s) accordingly.

 

Does this make sense?

 

Jon

AdWords Top Contributor Google+ Profile | Partner Profile | AdWords Audits
Marked as Best Answer.
Solution
Accepted by Zee (Community Manager)
September 2015

Re: Relationshlip among CPC and conversion rate

Follower ✭ ☆ ☆
# 3
Follower ✭ ☆ ☆
Hello Sophie.

Jons answer is very resourceful and makes a sense, Since a lot of campaigns are limited by budget, a good idea would be to examine the key words which convert and are profitable and focus on optimising your campaign around them since they deliver results - perhaps with a different bid strategy than for other less profitable keywords. Consider also if some keywords convert more on different Ad positions - lowering cpc is very likely to result in a shift in Ad position as well.

Hope this helps.

Re: Relationshlip among CPC and conversion rate

Visitor ✭ ✭ ✭
# 4
Visitor ✭ ✭ ✭
Hi Jon,
Thank you for your replay very much!The concept of Impression Share is very helpful ,however I can not check my Impression share---there is no statistics in the Display Impr. share column of my Adwords Account. We promote ads on mobile app banners Which is different from that of search network. Or does there something i ignore? why there is no data ?Many Thanks~
Sophie

Re: Relationshlip among CPC and conversion rate

Visitor ✭ ✭ ✭
# 5
Visitor ✭ ✭ ✭
Hi Damjan A,
Thanks for your reply, but the fact is that we do not display ads on Google Search Network, we are on mobile app banners. So there are no keywords in our account , and it seems that we can not set the keywords. yes, i agree with you that different cpc will result in a shift in Ad position.

Re: Relationshlip among CPC and conversion rate

Top Contributor
# 6
Top Contributor

Hi Sophie, I'm sorry, I don't run any Mobile App Campaigns so I can't check whether Impression Share data is available.  I can find nothing that says it isn't but mobile Apps can be a special case.  Another possibility is that the data simply isn't being shown yet.  Is it still not showing?

 

However, even if you can't see the stats, I'm confident that the drop in budget and/or CPC is the cause of the drop  in Conversions.  Your budget should ideally always  be driven by your Return on Investment so if you weren't making a profit before, you're actually less likely to by dropping your budget.

 

As Damjan has said, you may find it better to improve your targeting in some way, although I understand you're not using Keywords.  How are you targeting your Ads?

 

Jon

AdWords Top Contributor Google+ Profile | Partner Profile | AdWords Audits

Re: Relationshlip among CPC and conversion rate

Visitor ✭ ✭ ✭
# 7
Visitor ✭ ✭ ✭
Hi Jon,there is data in ads we run on website , and there is also data in image ads ran on mobile app ,but there is no data in text ads ran on mobile app.

The data of conversion rate increased a little when we increase the CPC and Budget. We do not use many targeting skills. we want to test a better landing page ,so we do not intend to use these skills.

We are firmly believe that the low conversion is due to landing page essentially. We got a lot of clicks ,and Google Adwords is in default of 1.5-click which avoids clicks in mistake. So when users click our ads,most of them are interested in our product.

We finally will use some targeting skills, but the first essential task we wii do is to test a better landing page.

Actually, when we carry out some targeting skills, we still can test landing page. However perhaps in that situation we do not know what really cause the increase of Conversion Rate.

Is there something wrong? Thanks~

Sophie