ROI and Google Ads Improvement

This week we learned how to calculate ROI. 

From what I understood, we need to determine all the costs associated to a product and subtracted them from the sale price of our product. That would be our profit. We divide the profit by the amount we spend in advertisement in Google and that would be our return on the investment we did. This is important because some ads or keywords may have a cost higher than our profit, which will be making us loosing money.

That actually is part of the second topic we studied this week. Google is able to generate a lot of information about the performance of our ads and our keywords. We can learn how many impressions we are getting, how many clicks we get from those, and how many people actually did what we define as “conversions”. In my case that would be purchases. I still have to work on this since Google says I’ve done 3 conversions but I haven’t had any sale, maybe people just added my product to their cart and they were counted as conversions.