Running a Google Ads campaign can seem daunting, especially for small businesses trying to maximize limited budgets. However, success comes in phases, and by following a systematic approach, you can scale your campaigns effectively while maintaining profitability. In this guide, we’ll break down the four phases of Google Ads success: Attracting the Ideal Customer, Turn Browsers into Buyers, Sustaining Success, and Venturing into New Horizons. Each phase has its own set of metrics and optimization strategies to ensure you’re making the most of your ad spend.
The phases framework and success metrics discussed in this article are from Chris Schaeffer’s Paid Search Podcast,specifically episode 386.
Phase 1: "Attracting the Ideal Customer"
In this first phase, your primary objective is to attract your ideal customer, ensuring that you’re bringing in high-quality visitors who are genuinely interested in your product or service. The focus is on refining your targeting strategy to draw intent-driven traffic—users who aren’t just casually browsing but actively seeking what you offer. The quality of the traffic should match the intent behind their searches. By optimizing for intent, you can reduce irrelevant clicks, improve your click-through rate (CTR), and ensure your traffic is highly relevant and more likely to engage further.
To succeed in your digital marketing efforts, you need a clear picture of your ideal customer. Start by defining their demographics, behaviors, and needs—who they are, what motivates them, and how they make decisions. By understanding this, you can optimize your ads and keywords to target the audience most likely to engage with and benefit from your offering, ensuring your marketing is intent-driven and aligned with customer needs.
Key Metrics to Monitor in Phase 1:
Click-Through Rate (CTR) Why it matters: A high CTR is a sign that your ads are resonating with the right audience. It’s an essential metric for assessing whether your Google Ads traffic optimization efforts are driving the right visitors. When your ads are well-targeted, users with the right intent are more likely to click, resulting in a higher CTR.
How to optimize: Implement strategies like A/B testing different ad headlines, experimenting with ad copy, and refining calls-to-action to better capture intent-driven advertising traffic.
Bounce Rate Why it matters: A low bounce rate suggests that visitors find your content relevant and valuable, which could be a signal that they are interested, and may become qualified leads. Bounce rate reduction should be a key focus to increase qualified leads.
How to optimize: To reduce bounce rate, ensure that your landing pages are aligned with the ad’s message and user intent. Additionally, make sure your website loads quickly and is mobile-optimized, as user experience plays a large role in whether a visitor stays or bounces.
Search Term Report Why it matters: This report allows you to see the actual search terms triggering your ads. By analyzing these terms, you can fine-tune your keyword strategy to ensure you’re capturing only intent-driven advertising traffic. If you notice irrelevant search terms, it’s a clear sign that you need to adjust your targeting or add negative keywords.
How to optimize: Regularly review the search term report to identify keywords that drive quality traffic. Add negative keywords to refine your Google Ads traffic optimization strategy and prevent irrelevant clicks.
Impression Share Why it matters: Impression Share indicates how much of the available market you’re capturing with your ads. If your Impression Share is low, you’re missing out on potential qualified traffic. Increasing this metric is a key aspect of Google Ads traffic optimization, ensuring that your ads are visible to as many high-intent users as possible. How to optimize: Improve your ad relevance and Quality Score to capture more impressions, and consider increasing your bids or adjusting any target CPA or target ROAS if Impression Share is low. This is a crucial part of expanding your reach to intent-driven advertising traffic.
Milestones for Advancement:
How can you tell if your account is still in Phase 1 or ready to move to Phase 2? While there aren’t strict boundaries, there are some key indicators that can help you assess your progress. These readiness milestones show when your campaign has built a solid foundation of qualified traffic, signaling it's time to shift focus towards conversion optimization and the success metrics of the next phase.
More than 90% of search terms for a given keyword are relevant to the keyword. For example: some text
You configured the keyword “SEO Services for Small Business”, then you’d want to see that 90% of the search terms are highly relevant, such as “"Affordable SEO services for small businesses", "SEO marketing for local businesses", or "Best SEO agency for small companies", etc
Search terms should all be part of the same funnel, matching the goal of the campaign. For example:
Bottom-of-the-funnel: “Emergency plumbing service near me”, “Book drain cleaning service today”, or “Plumbing repair appointment availability”
Top-of-the-funnel: “Best beginner fitness routines,” “How to choose the right gym,” “Benefits of personal training.”
Matching the funnel stage with the goals of the campaign helps ensure your ads align with the customer’s intent and the campaign’s goals.
Inbound traffic is ready for the product or service you’re selling. If you're running ads for a luxury car dealership, then you would want the majority of clicks to come from users searching for luxury cars, and not budget vehicles. Inbound traffic should show signs of high purchase intent or interest in your product or service tier.
CTR of 3% or higher: A healthy CTR demonstrates that your ads are relevant to the audience and driving interest. If your CTR is consistently above 3% (as a general guidance), it can be a strong sign that your campaign is attracting qualified traffic.
Bounce Rate below 40%: This indicates that the traffic you’re attracting is staying on your site and engaging with the content.
Phase 2: “Turning Browsers into Buyers”
In Phase 2, the focus shifts from attracting traffic to converting it into leads or customers. This phase emphasizes optimizing your conversion rate by refining ads, testing landing pages, and improving calls-to-action (CTAs). It's also essential to manage Cost per Acquisition (CPA) by improving ad relevance, quality scores, and implementing dynamic remarketing to re-engage non-converting users. Additionally, the goal is to enhance Return on Ad Spend (ROAS) by targeting high-value audiences, using effective keywords, and ensuring your landing pages align with user intent. The overall objective is to reduce or maintain costs while maximizing conversions, ensuring every dollar spent delivers meaningful, measurable results.
Key Metrics to Monitor:
Conversion Rate Why it matters: Conversion Rate is a vital metric because it directly measures how effectively your ads and landing pages convert visitors into leads or customers. Increasing your conversion rate ensures that more of your qualified traffic turns into meaningful actions.
How to increase conversion rate: To boost your conversion rate, focus on testing landing page layouts, refining calls-to-action (CTAs), and improving the user experience on your site. A/B testing different versions of your ad copy and landing pages can help pinpoint what resonates best with your audience.
Cost per Acquisition (CPA) Why it matters: CPA measures how much you're paying to acquire a lead or customer. It's especially important for campaigns focused on lead generation, where the goal is to convert leads into paying customers. Not all leads will convert, so it's crucial to consider your lead conversion rate when evaluating CPA. A lower CPA, coupled with a high conversion rate, means you’re using your ad spend efficiently.
How to reduce cost per acquisition: To lower CPA, focus on improving ad relevance and quality score. Additionally, implement dynamic remarketing ads to re-engage users who didn’t convert on their first visit, significantly improving your chances of reducing CPA while maintaining high traffic quality.
Return on Ad Spend (ROAS) Why it matters:ROAS measures the revenue generated for every dollar spent on advertising, making it a critical metric for profitability, especially for product-based businesses that can directly track revenue per conversion. A higher ROAS means your campaigns are more profitable, which makes it easier to justify increasing your budget. Optimizing ROAS ensures that your campaigns are driving a positive return on investment, helping you scale your marketing efforts while maintaining profitability.
How to optimize ROAS: To improve ROAS, focus on targeting high-value audiences and using keywords that drive the most revenue. Employ dynamic remarketing to re-engage users who showed interest but didn’t convert. Additionally, optimize landing pages to better match user intent, ensuring visitors find exactly what they’re looking for, which increases the likelihood of conversion and drives higher returns.
Milestones for Advancement:
How do you know it’s time to enter Phase 3? The transition to Phase 3 isn’t marked by rigid lines but by recognizing when your conversion strategy has matured. Once you’re consistently satisfied with your results in Phase 2 - such as achieving strong profit ratios and stable conversion performance - it’s a signal to start focusing on optimizing and refining those gains. Keep in mind that success thresholds vary between businesses, so adapt based on your specific objectives and growth trajectory.
Sustained Conversion Rate of 3% or higher: This shows that your ads and landing pages are effectively turning visitors into leads or customers.
CPA within your target budget: A maintained and controlled cost per acquisition indicates that you’re acquiring leads or customers efficiently and profitably.
ROAS of 300% or higher: Achieving a 3:1 return on ad spend means you're generating $3 in revenue for every $1 spent, making your campaigns both profitable and scalable.
In this phase, the emphasis is on making the most of your ad budget by turning traffic into conversions, all while keeping costs in check. By tracking the right metrics and engaging in targeted optimization efforts, you’ll be able to maximize the value of your ad spend and prepare for scaling in the next phase.
Phase 3: “Sustaining Success”
If you’ve reached Phase 3, congratulations! Your campaigns are now profitable, highly targeted, and delivering good leads. This phase offers an opportunity to increase your ads budget to boost revenue and profit dollars. However, scaling should be done incrementally to avoid overextending and to allow for close performance monitoring.
At this stage, the focus shifts to maintaining your ROAS or CPA while making small, strategic adjustments to sustain performance. Key activities include leveraging segmentation strategies, removing underperforming campaigns, and optimizing device targeting and bid strategies to ensure consistent profitability as you scale.
Key Metrics to Monitor:
Target High-Performing Devices Why it matters: Device targeting in Google Ads allows you to ensure your ads are shown on the devices that drive the best performance, whether that’s mobile, desktop, or tablet. Since conversion rates, ROAS, and CPA can vary significantly across devices, improving your ads and website experience for the best-performing devices helps you maximize returns while minimizing wasted budget on lower-converting platforms.
How to optimize: Regularly review performance metrics by device type. If mobile devices show higher conversion rates or better ROAS/CPA than desktop, apply device bid adjustments to increase bids for mobile and reduce them for desktop. Also, ensure your landing pages are optimized for the best user experience on your highest-converting devices, especially mobile.
Optimize Audience and Location Segments Why it matters: Tracking conversion rates and ROAS / CPA at the audience or location level helps you identify which segments of your campaign are performing best. Understanding how different audience groups or locations behave allows you to allocate more budget to high-performing segments, maximizing profitability and efficiency.
How to optimize: Segment your audience by factors like age, location, or interests. Prioritize the segments delivering the highest conversion rates and allocate more budget to them. If available, upload offline customer data into Google Ads via Customer Match to enhance targeting by leveraging your most qualified leads or customers.
Cutting Underperforming Campaigns: Regularly audit your campaigns, ad groups, and keywords to identify underperforming areas. Reduce or eliminate spend on segments with low conversion rates or high CPAs to optimize budget allocation. By reallocating funds to high-performing campaigns, you ensure your ad spend is more effectively utilized, driving better overall results.
Conversions / ROAS / CPA: As you progress, consistently monitor these core metrics. Keep a close watch on Conversions, ROAS, and CPA to ensure your campaigns remain efficient and profitable. Regular attention to these metrics helps sustain performance and reveals opportunities for further optimization.
Milestones for Advancement:
If you’ve reached Phase 3, your campaigns are running efficiently, and you’re seeing consistent results in terms of profitability and performance. You can choose to remain in Phase 3, making minor adjustments to campaigns for sustained success. However, if you’re ready to explore new opportunities and expand into untapped markets, Phase 4 offers the potential for growth.
Phase 4: “Venturing into New Horizons”
In phase 4, the goal is to scale your Google Ads campaigns to reach new markets, audiences, and territories. After optimizing for performance and efficiency in earlier phases, you’re now ready to expand. This phase centers around experimentation—testing new strategies, exploring untapped audiences, and targeting different stages of the search funnel to engage people who may not have previously considered your products or services.
Experimentation is key in phase 4. Leverage Google Ads experiments to test new ad formats, bid strategies, and audience segments. For example, you can try different bidding strategies to capture more conversions or test new keywords and ad copy to attract different customer segments. Google's experiment tool allows you to safely test these variables in a controlled environment while keeping the original campaign intact, helping you make data-driven decisions.
However, phase 4 is a high-risk, high-reward stage, so proceed with caution. As you experiment with new audiences and strategies, you may introduce unqualified traffic, potentially pushing your campaign back to earlier phases like phase 1 or phase 2. Approach this phase with thoughtful experimentation, regularly monitor key metrics, and be prepared to pivot based on performance.
Key Metrics to Monitor:
Conversions / ROAS / CPA: It’s critical to keep monitoring the optimized success metrics from phase 3. This is the first signal indicating whether your expansion efforts are affecting your optimized profitability riots. Consistently monitor these core metrics to make sure your campaign stays profitable.
Impression Share and Reach: As you expand into new markets, Impression Share and Reach become important metrics to monitor. Look for growth in these areas as you tap into new geographic regions or audience segments. However, make sure this growth doesn’t come at the cost of drastically reducing performance in conversion-focused metrics.
New vs. Returning Visitors: Track the ratio of new visitors vs. returning visitors to measure your success in penetrating new markets. A growing percentage of new visitors from untapped markets indicates you’re effectively reaching new audiences. However, ensure the quality of these new visitors is in line with your established audience by reviewing their conversion behavior.
Bounce Rate and Engagement Metrics: Expansion often brings in unfamiliar audiences, so keep an eye on bounce rate and engagement metrics like time on site or pages per session. A sharp increase in bounce rate could signal that your new targeting is off, leading to irrelevant or unengaged traffic. Successful expansion should maintain low bounce rates and steady engagement.
Audience Segmentation Performance: Leverage audience data from new segments to fine-tune your campaigns. Successful campaigns will show which new audience segments are converting at similar or better rates than your existing segments. Identifying high-value audience groups in new markets is a key marker of success in Phase 4.
Milestones:
Unlike earlier phases, Phase 4 isn’t a final state but a continuous process of expansion and exploration. Success in this phase depends on your ability to capture new markets and customers while maintaining profitability. Your Phase 4 efforts may be considered successful if you observe these key indicators:
Expanding Market Share: You are consistently growing your Impression Share and capturing a larger portion of the available audience. This shows that your efforts to expand Google Ads reach and scale market share are working.
Sustaining Profitability: Even as you increase ad spend and broaden your market reach, your ROAS and CPA remain strong. The ability to scale volume while maintaining key success metrics is a key sign that your phase 4 strategy is paying off.
However, campaigns can revert back to Phase 3 or even earlier phases when certain challenges arise:
Decreased Profitability: If you experience a significant drop in ROAS or an increase in CPA, it may be time to reassess and refine your audience segmentation, ad copy, or bid strategies. You will need to act quickly to return to key metrics levels from earlier phases, and focus on optimizing your current campaign and removing underperforming elements.
Lower Conversions: If you see a decline in conversions due to an influx of unqualified traffic, it’s a sign that your targeting may need adjustment. Re-evaluate your traffic quality and audience targeting to ensure you're still reaching the right customers. Making these adjustments quickly will help you regain control and prevent further performance issues.
Conclusion
Successfully navigating the phases of Google Ads requires a balance of performance optimization and strategic growth. Phase 1 focuses on attracting the right audience, while Phase 2 shifts to converting traffic efficiently, optimizing key metrics like CPA and ROAS. In Phase 3, the focus is on maintaining consistent performance and profitability through small, targeted adjustments.
For those ready to expand, Phase 4 offers opportunities for growth by experimenting with new markets and strategies. However, this phase comes with higher risks, requiring close monitoring of key metrics to avoid setbacks. Ultimately, the key to long-term success is ongoing optimization, thoughtful experimentation, and a readiness to adapt based on performance.
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