You're not sure if your Adwords campaign is worth what it costs. You can get totals for impressions, clicks, ctr and loads of other things but you don't know which numbers are significant and which can be ignored.
Wouldn't it be great if you were 100% sure that using Adwords was right - or wrong - for your business?
Sadly while Google gives loads of stats, they don't tell you what they really mean to you.
There are four numbers in your Adwords account which will tell you if you've set your campaign up correctly and if it's running well enough. They'll let you know if Adwords is a good fit for your business. If you don't have time to monitor every other performance metric watch these like a hawk.
It's easy to get lost asking only about the CTR and not thinking about how many of those clicks turned into customers. A fantastic campaign sending shedloads of visitors to a hostile website is as useless as a great website with no visitors.
Google won't give you this number automatically, you have to work it out for yourself.
It's the reciprocal of click through rate (1/CTR) multiplied by the conversion rate.
In MarketingMotor (my Adwords-based lead generation service) we work on a target of at least one conversion (sales lead) per 100 impressions.
Here are a couple of examples of how you'd get 1 conversion per 100 impressions.
In theory you should use the lifetime value of the customer (how much money you'll make from them over the time you do business with them) but that's almost impossible to calculate till you've had a big enough customer base for a few years. In practice it's easier to look at the value of that first sale and apply a bit of common sense to it. If profit is a clear winner then it's easy. If it's neck and neck you need to evaluate it more carefully.