SEO

Your AdWords ROI Is Better Than You Think

If you understand the AdWords conversion tracking cookie, you know you can’t report a monthly AdWords ROI accurately until 30 days after the month ends.

That’s not practical for agencies and freelancers. In August, they want to know how they did in July. So you tell them. You know they did better than that. But how much better?

BUT WAIT- before I answer that, there’s another ROI disparity you need to know about:

If you’re asked to report on ROI on a weekly basis, the first week is always going to look worse than the last week. Why? Because it’s a shorter date range. Someone who first clicks an ad on August 4th might not buy til August 15th, and if you report before then, you won’t see that conversion. It lowers your CR and ROI.

So there are two levels of inaccuracy here that your client needs to know about.

I told one of our big clients about both today. I thought the ROAS looked low, and I decided to compare a number of our first week reports against last week of month reports… here are the results:

adwords roas change Your AdWords ROI Is Better Than You Think

[And so you don't get too judgmental about my ROI numbers, these are general terms, not brand ones!]

As you can see, by the end of the month, ROAS was up 40% on average by the end of the month… and thirty days out it was 20% higher than we reported it right after the month ended.

adwords roi change chart Your AdWords ROI Is Better Than You Think

These are extremely significant ROI differences that come simply from when you do your reports. Make sure your client knows if they seem disgruntled at how a month begins, and don’t you freak out either. :-)

*NOTE about ROI and ROAS: ROI means return on investment. ROAS is one calculation of ROI = revenue / adspend. I use it because AdWords favors this metric (they call it Conv Value/Cost just to further confuse you). Analytics uses a different calculation for some strange reason… ROI, which factors out the cost of the ads. I don’t think the Google AdWords and Google Analytics people talk to each other much.

;-)

Brian Carter is the Director of PPC, SEO, and Social Media for Fuel Interactive and The Brandon Agency. He co-founded TweetROI which is an AdWords-like Twitter advertising service.

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Brian is author of The Like Economy: How Businesses Make Money With Facebook and Facebook Marketing: Leveraging Facebook's Features For Your Marketing Campaigns, How to Get More Fans on Facebook, and LinkedIn For Business: How Advertisers, Marketers and Salespeople get Leads, Sales and Profits from LinkedIn Brian has 12 years experience as a freelance consultant and digital marketing agency director. His hands-on business experience, cutting edge insights, background in improv and stand up comedy culminate in a keynote speaker, and social media trainer who leaves every audience not only entertained, but armed with powerful strategies and tactics.
c8aefda53a5c9e3de10e0468f9d99821 64 Your AdWords ROI Is Better Than You Think

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5 thoughts on “Your AdWords ROI Is Better Than You Think

  1. This is so true!!!!!

    I have just checked my page rank for the first time for one of my websites didnt think it was really doing that good and it has a page rank of three.

    just shows you how you get up there in the search engines.

    kind regards

    sam
    X

  2. Hi Brian,

    Great article on the post 30 day cookie tracking in AdWords (And nice ROI on the non-branded terms).

    I keep poking the AdWords team to extend the tracking to 60+ days so that advertisers with longer click to sales times can get a more accurate picture of their ROAS.

    Many of our B2B clients products/services take quite a bit of approval time on their clients’ side so 30-day post click tracking is often not long enough to capture conversion data.

    Luckily Google analytics tracks up to 60 days so the picture is clearer, but still waiting for AdWords.

    Any insights on how to get a better picture for advertisers with longer close times?