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A significant advantage to including Google Analytics with an Adwords Campaign is the ability to gain more insight into your Adwords campaign performance. It’s easy to set up Google Analytics through the Reporting tab in the Adwords tool bar. After setting up the Analytics account and installing the urchin tracking code on each page of your site, the combined Adwords / Analytics opens up more in depth reporting on your Adwords campaigns.

Once logged into your Analytics account, on the left navigation, under Traffic Sources, you’ll see sub menus that include Adwords. Under the Adwords submenu, you’ll see 3 selections: Adwords Campaigns; Keywords Positions; Campaigns; TV Campaigns if you are running Google TV Ads campaigns.

The first report reviews how people referred from your AdWords Campaigns compare to the “average” visitor to your site. This report includes all visits from AdWords. Click an AdWords Campaign in the table to see its component Ad Groups and Keywords. The “Clicks” tab displays the AdWords cost, impression, and ROI data useful for monitoring the profitability of your AdWords Campaigns and keywords. Are you beginning to see how you can dig deeper down on your Adwords Campaign with Google Analytics?

The next report, Keywords Positions, provides information on where your AdWords ads appear on Google search results pages and how much influence does search position have on visits, conversions, and other metrics. By using this report, you can determine your optimal search position for each keyword and plan your bidding accordingly for maximum impact. Click “view result” next to any keyword to see how search position correlates with Visits, Bounce Rate, Page Views, etc…by selecting the corresponding metric from the pull-down menu.

In a subsequent section on the left menu, you’ll find “Campaigns.” When you click on this, all subsequent campaigns listed in the table results are AdWords campaigns – campaigns that you have created by using the utm_campaign custom tag. You may also see “not set” which includes all other traffic to your site. Campaign performance can be a useful high-level view of the effectiveness of your marketing initiatives. This report includes all traffic to your site and you can use the “Segment” pull-down menu to view this traffic in different ways. For example, you can view the bounce rate of at the campaign level, or by choosing “keyword” from the pull-down menu, you can get individual bounce rates for each keyword in a particular campaign.

In the left menu navigation, below “Campaigns” you find “Ad versions.” This report provides information on how your AdWords ads (and other types of ads that you have tagged with the utm_content tag) compare against each other. Ads with high clickthrough rates show that the copy is effective at getting the user to click, whereas a high bounce rates, for example, would indicate the landing pages is not connecting with the keyword term of the searcher or is not consistent with what the ad promises.

Like all good marketing initiatives, measuring and reporting on the effectiveness of your efforts is crucial to determining the ROI of your marketing dollars. With Google Adwords, combined with the power of Google Analytics, you have the ability to quantify and analyze your marketing spend for maximum impact and optimal performance.