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There’s little doubt that the AdWords interface from Google is both powerful and appealing; after all, that’s how Google has managed to achieve an estimated $27.4 billion per year in online advertising sales, eclipsing all competitors combined. But Google never sleeps, and AdWords itself is certainly not short on innovation. The most recent addition to the web advertising toolkit is an option to optimize ads for conversion.
Let’s go over the basic lingo for those in the room who need some 101-level support. First, when I say “optimizing advertisements,” I’m referring to Google’s “ad rotation.” Users have been able to select either “optimize for clicks” or “show more evenly.” That first option will show the ads most likely to get clicked on, while the second will allow advertisers to get more balanced feedback on which ads are working best. But click-through rate (the percentage of the time an ad is clicked) doesn’t necessarily mean higher “conversion” – the term used to describe an advertisement leading to the intended result (sale, newsletter sign-up, site registration, etc.) – which is the entire purpose of Google “optimizing” for “conversions.”
How does Google do this? Through the conversion tracking tool in analytics, which allows users to set up a specific page that registers a conversion; this will typically be a “thanks for your purchase,” “you’re now registered,” or a similar landing page with a bit of extra code embedded for Google’s eyes only. With conversion tracking set up, users can connect the Google Analytics and Google AdWords data to get a sense of which ads are actually resulting in sales.
For those who don’t really understand the nitty-gritty of conversion, the new optimization option is ideal. By just setting up conversion tracking and choosing the “optimize for conversions” option, advertisers will get some Google assistance in making sure the ads lead to achieving company goals.
[via the AdWords blog]