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:
[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.
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.