In online marketing, it’s important to track conversions. This means not only knowing how many people visit your website but also how well your website is converting visitors into customers or leads. In this guide, we will explain what Google Conversion Value Rules are, how they work, and how you can use them to enhance your online marketing strategy.
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Understanding Google Conversion Value Rules
Google Conversion Value Rules are essential in this process. They allow you to assign values to different actions or events on your website, helping you measure the return on investment (ROI) of your online advertising accurately.
What Are Google Conversion Value Rules?
Google Conversion Value Rules, or Conversion Value Rules, are a tool in Google Ads that lets advertisers assign values to different actions on their websites. These values show how important or valuable each action is in terms of generating revenue. This helps advertisers measure the success of their advertising campaigns.
Conversion value allows you to adjust the value of conversions. These adjustments are based on the category of the conversion action and three impression dimensions:
- Audience: Customize conversion values based on specific audience segments.
- Location: Tailor values depending on the user’s geographic location or their area of interest.
- Device: Adjust values based on the type of device used for the conversion.
Using the Google Ads API, you can take full advantage of conversion value rules. They can define these rules, consolidate them into rule sets, and apply them to their Google Ads account or specific campaigns.
The Google Ads API report offers valuable insights, providing a detailed breakdown of:
- Original conversion values
- Unadjusted conversion values
- Adjusted conversion values.
Conversion value rules themselves consist of two core components:
- Conditions: These conditions determine when the rules are applied. It’s here that advertisers specify the circumstances under which they want to adjust conversion values.
- Actions: Once conditions are met, these actions come into play. They dictate what happens when the rules are applied. This could include adjusting the value of a conversion, among other possibilities.
However, it’s important to note that while conversion value rules are highly effective for optimizing target Return on Ad Spend (ROAS) and maximizing conversion value, certain campaign types, such as smart shopping campaigns, have limitations. Specifically, they do not support target Cost Per Acquisition (tCPA) and maximum conversions bidding strategies.
Why Are Google Conversion Value Rules Important?
Conversion Value Rules are essential because they provide a quantitative measure of your campaign’s success. Instead of merely tracking the number of conversions, you can assign a value to each conversion based on its significance to your business. This allows you to:
- Optimize ad spend: By knowing the value of different conversions, you can allocate your advertising budget more efficiently to campaigns that drive higher-value actions.
- Maximize ROI: Understanding the monetary impact of each conversion action helps you focus on strategies that deliver the most revenue.
- Refine targeting: You can refine your audience targeting to attract users more likely to complete high-value actions, ultimately increasing your profitability.
How Google Conversion Value Rules Work
Here are the five aspects of how Google Conversion Value rules work.
- Defining conversion actions. Before you can use Conversion Value Rules, you need to define the conversion actions you want to track on your website. These actions could include product purchases, form submissions, app downloads, or any other activity that holds value for your business.
- Assigning conversion values. Once you’ve identified your conversion actions, you can assign a specific monetary value to each one. This value should reflect the expected revenue or profit generated from that action. For example, if an average purchase on your website is $50, you can assign a conversion value of $50 to the “Purchase” action.
- Implementing the conversion tracking tag. To track conversions accurately, you need to implement the Google Ads conversion tracking tag on your website. This tag records when users complete a conversion action and sends the associated value data back to your Google Ads account.
- Creating conversion value rules. Conversion Value Rules allow you to modify the default conversion values based on certain conditions. For example, you can create rules that increase the value of a conversion action if it originates from a specific ad campaign or device type. This flexibility enables you to account for varying conversion values in different scenarios.
- Analyzing performance. With Conversion Value Rules in place, you can analyze the performance of your advertising campaigns more effectively. Google Ads provides detailed reports on the revenue generated by each campaign, ad group, keyword, and even specific ads. This data helps you make informed decisions on where to invest more or less of your advertising budget.
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How to Use Google Conversion Value Rules in Practice
What are Conversion Value Rules Conditions?
Conversion Value Rules are important for optimizing your campaigns effectively. These rules have specific conditions that can be customized to suit your advertising strategy. Let’s break them down:
- Audience Condition. The audience condition allows you to target impressions based on specific audiences, including Google and first-party audiences. You can be more specific by using user lists or user interests. To access the available user lists or user interests, use GoogleAdsService with targeted queries.
- Device Condition. The device condition allows you to target impressions based on specific device types, such as mobile, desktop, or tablet.
- Geo-location Condition. The geo-location condition enables you to target impressions that meet specific location criteria.
Rules and Limitations
Each conversion value rule can have up to two conditions. Rules with no conditions apply to impressions that don’t meet the conditions of other rules in the set. Conversion values set at the campaign level won’t affect the performance or reported conversions of other campaigns.
Different Levels, Different Rules
- Account-level campaign value rules apply to Search, Display, and Shopping campaigns.
- Campaign-level value rules apply to various campaign types, including Search, Display, Shopping, Smart Shopping, and Pmax for retail.
- D&E tests with value rules apply to Search and Display campaigns.
How Conversion Value Rules Work
Let’s explore how Conversion Value Rules work.
Rule Action
- Every rule has an action that consists of an operation and a value.
- Actions tell Google how to adjust conversion values for rules that meet your conditions.
- You can choose from three values: Add, Multiply, or Set, each with its own use cases.
Creating Rule Sets
- Group conversion actions and rules after setting up Conversion Value Rules.
- Rule Sets apply to specific conversion action categories, like store visits or sales, or all categories if none is specified.
Dimensions in Value Rule Sets
- Dimensions included in a rule set determine usable conditions.
- If geo-location and device dimensions are included, audience conditions can’t be added.
- The NO_CONDITION option has its own rules and restrictions.
Choosing Attachment Type
- Select CUSTOMER for account-wide rules or CAMPAIGN for campaign-specific rules.
- When choosing CAMPAIGN, specify the campaign it applies to.
How Rules Are Applied
- Google selects one rule per conversion based on precise location matches and audience hierarchy.
- In case of a tie, MULTIPLY logic takes precedence over ADD, with the highest adjustment chosen.
Reporting with Conversion Value Rules
- Conversion Value Rules impact campaign-level conversion value reporting automatically.
- Adjusted and unadjusted values can be viewed through value rule adjustment segmentation.
Removing Rules and Rule Sets
- Removing a rule resumes optimization based on your current value definition, potentially causing data discrepancies.
- ConversionValueRuleSets must have at least one PAUSED or ENABLED conversion value rule.
- Removing a ConversionValueRuleSet doesn’t affect the status of referenced ConversionValueRules.
Remember, choosing between Add, Multiply, or Set actions can greatly affect your results. When organizing your rules, Rule Sets provide a structured approach that is tailored to specific conversion action categories.
Additionally, attachment types allow you to apply rules at different levels, giving you flexibility in managing your campaigns. Google’s selection of rules per conversion is an important aspect, as it ensures optimal adjustments based on location and audience hierarchy.
How to Estimate Conversion Value
To estimate conversion value, use these three equations:
- Short-term value: Multiply how much money you make per sale by how often people buy from you and how many people actually buy from you.
- Lifetime value: Add up how much money you make from each customer over their lifetime and multiply that by how often they buy from you and how many people actually buy from you.
- Impact from customer recommendations: Figure out how much each new customer is worth to you and how many new customers you get from customers recommending your products or services to other customers.
To calculate lifetime value per conversion considering word of mouth, multiply lifetime profit per customer by the percent of leads that convert and the word-of-mouth gain.
Best Practices for Using Conversion Value Rules
To get the most out of Google Conversion Value Rules, follow these tips.
- Make sure the conversion values you assign accurately reflect the revenue generated by each action. Over or undervaluing conversions can give you wrong information.
- Regularly review and adjust your Conversion Value Rules based on performance data. What works today may not work tomorrow, so it’s important to be flexible.
- Create rules that segment your data by factors like location, device type, or demographics. This can help you discover which segments are driving the most valuable conversions.
- Use cross-device tracking to account for users who interact with your brand on multiple devices before converting. This is especially important for businesses with longer conversion cycles.
- Combine Conversion Value Rules with advanced attribution models to understand the entire customer journey and assign values accordingly.
How to Determine When to Use Conversion Values
To decide if conversion values are appropriate for your campaign, consider your sales process and how you utilize Google for marketing. Here are some key factors:
- Nature of products. If you’re selling items like bicycles or smartphones, it can be challenging to determine the value of a conversion without robust tracking systems to measure how many interested users actually make a purchase.
- Direct sales impact. If your ads lead directly to sales, it’s advisable to assign a value to them.
Imagine you’re managing an online store where the worth of a conversion stemming from a product view can vary significantly. Some may hold more value than others. In such cases, it’s vital to set up conversion values that correspond to the specific transactions. This is where dynamic values play a crucial role, allowing you to allocate your budget efficiently based on the varying importance of each conversion.
The Importance of Accurate Conversion Values
Consider this scenario: you have two keywords in your account, both with conversions, but the values are unknown.
When we are not sure about the exact value of each conversion, we might think that keyword 1 is more successful because it has a higher number of conversions. But if we look closer and find out that the conversions from keyword 1 are consistently worth less than those from keyword 2, it becomes clear that keyword 2 is more important. By using dynamic conversion values, we can greatly improve our decision-making process.
While other factors, like the cost per conversion, are important, having precise conversion values empowers you to make better choices about budget allocation.
Static vs. Dynamic Conversion Values
The choice between static and dynamic conversion values can have a big impact on your advertising strategy.
- Static Values: If you have pages promoting products with fixed prices, use static conversion values. Create a value for each product or promotion and focus on the ones that make the most money.
- Non-Monetary Conversions: If your promotion doesn’t make money, like a free trial or demo, you can assign values to them. These are called Key Performance Indicators (KPIs) and you can give them numerical values. The more valuable the conversion, the higher the number. To set up KPIs, choose “no currency value” for your conversion value.
Conclusion
Google Conversion Value Rules can help you measure how effective your advertising campaigns are in terms of making money. You can make decisions based on data that will help you get the most return on your investment. By setting up conversion actions, assigning accurate values, and creating rules for different situations, you can improve your advertising strategy and achieve more success online. In a world where every advertising dollar matters, Conversion Value Rules give you an advantage that you shouldn’t ignore. Start using them today to make the most of your online marketing.