Pay-per-click campaigns can be totally wasted if not managed effectively. But if done right, it can be extremely lucrative. There are various metrics to evaluate the success of the campaign. some of which are stated below:

Clicks and Conversions:

One of the most trusted ways to measure a campaign's success is if it getting a good level of impressions and clicks. It is true that budget is going to have some effect on the number of clicks and impressions you received for an ad. However, PPC is not just about receiving clicks. So, what beyond it? What do your site visitors do after they click your ad?Do they fill out a contact form on your website? Do they pick up the phone and call you? A PPC campaign which compels a user to get ready to purchase the product of your company is an apt example of increasing conversions. After all, the online marketing tactic is about increasing traffic and sales instantly. You should always aims for high conversions because that means that a high proportion of people coming to your site are carrying out your desired action. You can also set up a conversion for an email sign up or pull in engagement goals from Analytics to gauge the quality of the traffic coming via PPC.

Click Through Rate (CTR):

To gauge the success of Pay Per Click campaign, it is always vital to have a good ratio of clicks to impressions or CTR. Additionally, aim a high score of CTR as Google takes into account to evaluate the quality score of your keywords. Depending on the type of campaign, display or search, a ‘good’ CTR will vary, but anything over 0.5% for a display campaign and around 3-5% for a search campaign is something to aim for.

Average Position

It is also important that your ad appears in top three position on search engine pages in order to get your ad noticed. If your ad does not qualify for tops position, it is at the risk of getting lost like the rest of the ads. With Low CTR, your PPC ad would get average position. In such case, you can increase bidding amount to achieve those top of page slots and see your CTR improve.

Sales / Leads

The main purpose of your ad is to generate sales/leads. If it doesn't show required results then there's something wrong with your campaign. You also need to factor in ROI. If sales are coming in, are enough coming through to ensure you are seeing a return on your investment?

Bounce Rate

Another softer metric you can look at to try and establish the quality of traffic coming from PPC ads is bounce rate. This can be done in AdWords itself or within Google Analytics.

If the majority of traffic coming to your site is bouncing straight off the landing page, then think about whether your keywords are right, if your ad conveys the right message and if the landing page is strong enough to then convert them into a customer.