So, you’re diving into Google Ads and hear the term ‘Conversion Value’ tossed around.
What’s this all about?
Basically, it can tell you the actual impact of your ads on your business.
In this quick guide, we’re going to break down what is Conversion Value in Google Ads and why it matters for different types of businesses.
Whether you’re selling products, booking appointments, or just trying to get more eyes on your site, understanding Conversion Value can change the way you run your ads.
What is Conversion Value in Google Ads?
Conversion Value in Google Ads isn’t just about how many people take a specific action (like making a purchase or signing up) after clicking your ad, which is what we call a conversion.
It’s about understanding how much value each of those actions brings to your business.
It’s a step beyond just counting conversions.
Let’s imagine you own a high-end camera store.
Suppose one ad campaign leads to 50 people buying $50 accessories.
But what if another campaign results in only 10 sales, yet each sale is a $2,000 camera?
The first campaign might have more conversions, but the second one, with fewer conversions, actually brings in more money.
Conversion Value helps you see which campaign is truly more beneficial for your business in terms of revenue, not just the number of sales.
Google sums it up well:
“Conversion values help you measure and optimise the true business impact of your ad campaigns more accurately.
If you assign values to your conversions, you’ll be able to learn the total business value that Google Ads generated, rather than simply the number of conversions that have happened.
You’ll also be able to identify and focus on high-value conversions.“
So, Conversion Value is about looking at the big picture of your ad’s performance.
It’s not just about how many conversions you get, but the overall economic impact of those conversions on your business.
The benefits of using Conversion Value
It helps you think about ROI
When it comes to ROI, Conversion Value is like having a magnifying glass.
It allows you to see not just if you’re getting a return, but how significant that return is.
This is great for when you need to gauge the effectiveness of different campaigns.
You can pinpoint which ads are just ‘busy work’ and which ones are the real moneymakers.
Your bidding strategies improve
With Conversion Value, your bidding strategy gets an upgrade.
It’s like switching from manual steering to autopilot.
You’re giving Google the insight to bid more on ads that attract high-value sales and less on those that don’t.
This isn’t about letting Google take the wheel blindly; it’s about giving it a better map.’
You’ll start to think less about clicks
Conversion Value takes you past the click-and-count game.
It’s about understanding the story behind each sale.
For instance, are you attracting bargain hunters or big spenders?
This insight is important if your goal is more about quality sales than quantity.
It helps you make your business sellable
Using Conversion Value helps you build a more resilient business model.
It’s like fine-tuning your ads to attract not just more customers, but the right kind of customers.
Over time, this means you’re not just increasing sales, but also enhancing the quality of your customer base.
This shift can lead to better customer loyalty, higher average sales values, and ultimately, a stronger brand that can be sold in the future (if you want to exit).
It helps you make better decisions
Another long-term benefit is the wealth of data Conversion Value provides.
This data isn’t just useful now; it’s a goldmine for future decision-making.
You start to see patterns and trends that can inform your business strategy.
Maybe you’ll notice certain products have a higher value, or certain ads perform better at different times of the year.
This kind of insight is invaluable for making smart, informed decisions about where to focus your efforts in the future.
My personal take on this
From my own experience, using Conversion Value is like giving Google a clearer picture of what success looks like for you.
It’s not just about telling Google, “I want sales.”
It’s about saying, “Here’s what a good sale looks like for me.”
This clarity helps Google find better leads, which can mean more profit for you.
How to track Conversion Value
So, you’re ready to track Conversion Values in your campaigns? Great!
First things first, it’s about knowing what you want to track.
Are you looking at sales, sign-ups, or maybe high-value inquiries?
Decide what a valuable conversion means for your business.
Setting up your conversion tracking
Now, for the tracking part. Sure, you can do this manually, but who has time for that?
Tools like WhatConverts are a lifesaver here. They make tracking a breeze.
At our fractional marketing agency, JRR Marketing, we use WhatConverts, and it’s totally changed the way we run our business.
How to use tools like WhatConverts
WhatConverts lets you see not just that conversions happened, but the details behind them – like how much they’re worth.
This takes a lot of the guesswork out of understanding your ad’s performance and your conversion value.
I know this is especially hard for professional and service businesses to track, but this software makes it easy.
Here’s a quick overview of how it works:
So, whether you’re new to tracking Conversion Values or looking to streamline your process, using tools like WhatConverts and checking out helpful videos can really simplify the journey.
Tracking becomes less of a chore and more of a strategic asset for your business.
How to optimise your Google Ads campaigns with Conversion Value
Now that you’re tracking your Conversion Values, the next step is optimising your Google Ads campaigns to maximise these values.
This is where Google Ads’ bidding strategies like Target ROAS (Return on Ad Spend) and Maximise Conversion Value come into play.
Once you’ve got enough data on your Conversion Values, consider switching to Target ROAS.
This strategy is all about balancing spending with revenue.
You set a target return you want from each dollar spent on ads.
Google then adjusts your bids to try and meet this target.
It’s great for when you have a clear understanding of the value each conversion brings and want to optimise for profitability.
Maximise Conversion Value
If you’re not ready for Target ROAS or still collecting Conversion Value data, Maximise Conversion Value is a solid choice.
It’s less about hitting a specific return target and more about getting the most valuable conversions within your budget.
This strategy is ideal for growing the overall value of conversions, especially when you’re still figuring out your ideal ROAS.
Focus on Conversion Value in Google Ads and you’ll be ahead of the 99%
Stepping into Conversion Value tracking puts you miles ahead in the digital advertising game.
It’s about playing smarter, not harder.
By focusing on the real value of your conversions, you’re not just running ads; you’re investing in the future of your business.
In a world where many are still playing the numbers game, being one of the few who master Conversion Value can set you apart, making your ad spend more efficient and your business more profitable.
So, consider implementing Conversion Value tracking in your ad campaigns – it might just be the decision that puts you ahead of the competition.