We often come across a question from Account Managers whether they should track their Conversions in Google Ads via a Google Ads Tag, or import conversion actions from Google Analytics (Goals, Transaction etc.) into Google Ads in order to track the success of their Google Ads campaigns and provide the bidding algorithm with conversion data.

Before answering that question, let’s first look at the questions why it is even more important nowadays to track conversions due to the increase of importance of smart bidding and therefore also provide as accurate data as possible to the bidding algorithm. 

 

Why is it nowadays even more important to track conversion data of your Google Ads campaigns?

 

The main reason is that campaign managers want to know how many leads or revenue is actually generated while spending money on advertising on Google Ads. But collecting sufficient conversion data is not only important for keeping track of your business numbers, it also has a huge impact on campaign performance. The importance of smart bidding in Google Ads has grown dramatically lately and is not stopping.

Why is it important for smart bidding to collect correct conversion data?

In order to answer that question it is important to understand how smart bidding actually works. Simply said smart-bidding is using advanced machine learning in order to do “auction-time bidding” based on several user signals. 

These are the current smart biddings strategies on the market: Enhanced CPC (not fully automated), Target-CPA, Target-ROAS, Maximize-Conversion, Maximize Conversion Value. The goal of each smart bidding strategy is to increase either the number of your conversions, increase the Return on Investment or lower your Costs per Conversion. The big difference between smart-bidding and manual bidding is that you no longer have to manually select bids you are willing to pay per click. The algorithm selects for every auction a max-CPC based on the likelihood of a conversion of the users performing a search request.

From where does the algorithm know if there is a high or low likelihood that a user converts?

Smart-bidding is comparing the behavior and data of your previous converters to the user performing the search query and then deciding on the likelihood. Meaning that if the user behavior of the user is similar to the behavior of users who converted in the past the smart-bidding strategy will put a higher bid in order to rank you higher. If the behavior is different to the past converter the max-bid with which you will enter the auction will be lower (and therefore also your rank) or you might even not enter the auction. 

But of course it is also taking a lot of other factors into consideration such as the user-location, time of the day, device etc.

If you want to know more about how smart-bidding actually works you can find a lot of information regarding smart bidding in the Google Ads Helps Center.

That’s the reason why it is important to provide as much data as possible to the smart-bidding algorithm in Google Ads

As mentioned before when the algorithm decides the max-CPC amount when entering the auction it is taking into consideration the data of your previous converter. The more data you provide to the algorithm the better it actually can define the likelihood of a conversion of a user. This leads to an optimization of the bid the algorithm is entering the auction with. 

Why do you lose conversion data when you track Conversions via Google Analytics in Google Ads? 

The main reason is because conversion tracking in Google Ads simply works differently than conversion tracking via Google Analytics. 

If you track your conversions in Google Ads the process is the following: The default cookie duration is 30 days. Meaning if a user clicks on one of your Ads and lands on your page a cookie is installed for 30 days. Also if this user doesn’t convert the first time visiting your page via your paid ad a conversion is recorded if the user returns any time within the 30 days and completes a conversion. It doesn’t matter which channel the user used the last time before completing the Conversion – Google Ads will record a conversion. Unless the user deletes it’s cookies.

Example:

  • Day 1: User clicks on your Ad, leaves your page without converting
  • Day 10: The same user is looking for your company on Google and enters your page by clicking on an organic search result, the user follows your business on social media but doesn’t complete the conversion
  • Day 29:  The user sees a Social Media post of your business and clicks on a link which leads to your website. This time the user completes the conversion. 

Result if you are tracking Conversion via Google Ads Tag: A Conversion is recorded in Google Ads.

Now what is the main difference to Google Analytics Conversion tracking?

The main difference is that Google Analytics and Google Ads are using different Attribution models. Analytics attributes the last channel a user is coming from before completing a Conversion. So if a user initially visited your page by clicking on your Ad, doesn’t complete the conversion and returns later by using another channel, Google Analytics is not crediting Google Ads for the conversion even though Google Ads was the first point of touch with your company. Google Analytics will credit the last channel the user used before converting. 

 

Coming back to the example:

  • Day 1: User clicks on your Ad, leaves your page without converting 
  • Day 10: The same user is looking for your company on Google and enters your page by clicking on an organic search result, the user follows your business on social media but doesn’t complete the conversion
  • Day 29:  The user sees a Social Media post of your business and clicks on a link which leads to your website. This time the user completes the conversion. 

The result if you are tracking Conversions in Google Ads via Google Analytics: No conversion recorded in Google Ads – Analytics is crediting Social Media for the conversion.

The only channel Google Analytics is not crediting for a conversion in case it’s the last channel in the conversion path is “Direct” – Analytics is then crediting the channel used before “Direct” for the conversion.

The only channel Google Analytics is not crediting for a conversion in case it’s the last channel in the conversion path is “Direct” – Analytics is then crediting the channel used before “Direct” for the conversion.

This means tracking conversion in Google Ads via Google Analytics leads to a lack of Conversion Data in Google Ads

Why? Because most of the users do not convert when they visit your page for the first time. Most of the time users compare your page to competitors or consider first if they actually really want your product or service. 

Does Google Ads record View-Through Conversion if I track conversions via imported Analytics Conversion?

No and that is another big issue when Tracking Conversions in Google Ads via Google Analytics. If you run a remarketing campaign you want to remind website visitors about your product and service. You want them to return to your page and complete the conversion because they didn’t convert before. As these users already visited your website earlier on they already know your company. Some of them might not click on your Ad when you are running a remarketing campaign but after getting reminded about your product/service they might directly visit your website by using your URL instead of clicking on the ad for example. 

If you are tracking conversions in Google Ads via Google Analytics no conversion will be recorded because the user didn’t click on the Ad – the user only saw your ad. Analytics will again credit the channel the user used before converting. But if you track via Google Ads Tag your remarketing Campaign will record a conversion as there will also be a cookie set when the user only sees your ad but not click on it.

All of this doesn’t only mean that your numbers in Google Ads look worse than they actually are. This also has a big impact on the performance of your campaign. You provide less relevant data to your smart-bidding algorithm. The more conversion data you provide the better the algorithm can optimize your bids in order to increase your conversion or Return on Investment

Does this mean that I only need to track conversion in Google Ads and Conversion Tracking in Google Analytics is not necessary?

Absolutely not. We just strongly recommend to track your Conversion within Google Ads via Google Ads Tag. It is still very important that you track your conversions separate in Google Analytics but for different purposes. Analytics is a multi-channel analysis tool. It is important that you keep track about the numbers of all of your marketing channels. There is a simple way in analytics to figure out the conversion path of every user. You can check each channel of a user before completing a conversion by checking the “Top-Conversion-Path” (Conversions > Multi-Channel-Funnel > Top Conversion Path). In our opinion this is one of the most important Google Analytics Report for Channel optimization.

However, you should track in Google Ads your conversion actions separately via Google Ads Tag and not with the imported Google Analytics conversion action in order to provide more conversion data to your smart-bidding-algorithm.

Common Mistake: Thinking that changing the Attribution Model in Google Ads has an impact on the channel attribution in Google Analytics

One common mistake we have come across is that many advertisers think that changing the attribution model in Google Ads from last click on another model has an impact on the Channel Attribution in Analytics. You can not change the channel attribution of Google Analytics by changing the Attribution Model in Google Ads. This only results in a change of the conversion attribution in Google Ads. If the last channel before completing a conversion wasn’t your Ad from Google Ads you will still not see a recorded conversion in Google Ads if you track via Google Analytics.

 

If you want to know more about the Attribution Model in Google Ads and its impact stay tuned as we will soon release another article about this topic.

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