Here are a list of some common and main Paid Search metrics and their definition that you would like to know about before starting your paid ads, everything here will be with respect to Google Adwords as it is the most commonly used paid search platform.
When your ad gets displayed on the Search Engine Results Page (SERP) it is called an impression. Where your ads get placed on SERP, their position as well as if it is placed below the fold or above fold.
If the user clicks and ad, then it is called a click
The amount that Adwords charges when the users click your ad. You can monitor your day wise spend, as well as on any timely basis on Adwords. Its is the total sum of all cost per click.
CTR – Click Through Rate
Click through rate is defined as a metric which is the number of users who have visited your site after clicking on the ad.
It can also be defined as – no. of clicks/total impressions
CPC – Cost Per Click
As the metric says it is defined as the cost taken per each click on the ads.
Max CPC is defined as the total amount of cost you are willing to spend for each click.
Avg CPC is defined as the total spend per total number of clicks. Avg CPC can never cross Max CPC, as it is the maximum you are willing to pay.
This is an action that is defined when user interacts with your ad and takes an action that is valuable to you. It can be a product order.
It is the the value for each conversion. The value of order or it can also be defined as the value that you have set for each order that takes place. An order can also be a phone call, that takes place through your ad.
Conversion rate is defined as the total umber of orders that have taken place for the total number of respective clicks.
ROI – Return Over Investment
ROI is defined as total profits that you have made. It can be derived by this formula: (Revenue – Cost)/Cost.
R/C – Conversion Value/Cost
It is a metric that is used to measure the performance of your account and the other elements in the account. You can define a fixed value for this metric and monitor the performance of your account.
CPO – Cost Per Order
This is another metric which measures the performance of your account. Cost per Order as the metric says is the total spend per total orders.