Conversion Value: What It Means & Why It’s Crucial to Your Business

Online businesses that leverage the internet for marketing must pay close attention to Conversion Value. This metric helps businesses understand the returns they are getting from various marketing strategies. Each marketing effort produces different results, so businesses should focus on those that yield significant returns and optimize them to enhance their overall marketing strategy.

What Does Conversion Value Imply?

Conversion Value is a numerical value assigned to a specific conversion to evaluate its impact on your business. By utilizing this method, you can track the Return on Ad Spend (ROAS) and assess the effectiveness of your current marketing efforts. For instance, if a user clicks on an ad and downloads a document from your website, and this action positively influences your business, you can assign a value to it. Each time someone downloads that document, the conversion value will be recorded in your account.

You can set a Target Return on Ad Spend to maximize conversions. Establishing conversions provides valuable insights regarding specific keywords, campaigns, and other advertisement forms, which can help attract more customers. This information can guide you in making better decisions related to business strategies.

How Do You Assign a Conversion Value?

The Conversion Tool is free to use. Here are the steps to set up a conversion value:

1. In your Ads account, navigate to the section titled “Value.” Here, you can assign a uniform value to a specific conversion. You can also assign different values to different actions, as not every conversion may have the same importance. For uniform values, use a ‘static value’; for variable values, use a ‘dynamic value.’

2. Next, you need to modify your website’s code by adding a tag to the page that visitors will see after completing a conversion. This tag should include the conversion value and its currency. If you’re unfamiliar with this process, consider consulting a web developer.

3. Once the necessary modifications are made, every conversion will relay the required information back to your linked account, reflected as your Return on Ad Spend for easy tracking.

If you already have an active conversion tool and need to make edits, follow these steps:

1. In your account, go to the “Tools & Settings” area.
2. Select the “Conversions” section. Click on it, then choose the conversions you want to edit and select the “Edit Settings” option.
3. Follow the above steps to add static or dynamic values to these conversions.

How to Set Targets?

After assigning conversion values to each action, you can manually set your bid strategy. This applies to both static and dynamic values. Check the appropriate campaign and click on “Edit.” Then, select “Change Bid Strategy” and set it to Return on Ad Spend to maximize your outcomes.

Why Should You Use Conversion Values?

The relevance of conversion values depends on your business type and marketing strategy. To effectively utilize this tool, your business should have diverse actions and multiple marketing strategies. If online advertisements directly lead to well-defined sales, this tool can be extremely useful.

For e-commerce websites with a range of products, assigning a single value to each product may not yield accurate results. Instead, using dynamic conversion values that are transaction-specific helps optimize your account. Additionally, if certain keywords drive more traffic or sales, assigning specific values to them enhances your marketing strategy. Understanding the distinction between keywords that attract customers and those that lead to purchases is crucial; different businesses may prioritize one over the other.

In conclusion, conversion values are vital for businesses as they help track the impact of each marketing initiative. If an advertisement does not lead to a sale, you can assign a low or zero value to it to assess its influence. Thus, the Conversion Tool enables businesses to make informed decisions about marketing strategies and improve their online presence.