How to Compare the Performance of Different Ads Using Google Adwords

Google reports the following at the ad. level

It is known that the ad with the highest click through rate is not necessarily the best converting ad just as the keyword with a higher CTR is no guarantee that the keyword will convert to a sale better than a keyword with a lower CTR.

This information derived from Google’s report should be used to judge the profitability of 2 ads. Just by looking at the generated data it is difficult to judge whichever of the running ads makes the most profit.

In comparing the performance of different ads (or keywords) the data needs to be reduced to a common base.

In a previous article I described how Google works in maximising its profit from Adwords… Google maximises the earnings from every 1,000 ad impressions.

This is the way we should also judge profitability from an Ad campaign.

To be able to make statistically valid conclusions it’s important to have enough data which means it can take a very long time to be able to assess performance if conversion numbers are low and/or ad click though rates are not statistically valid.

Here’s an example of a comparison between 2 different ads… Get the actual Excel calculator by clicking here

This analysis becomes valuable as a campaign grows older and when a number of ads have been tested against each other since under these circumstances ad rotations will not be 50/50. If ad impressions are rotated 50/50 or close to that then cost per conversion is a good enough indicator of profitability.