Changes to Tracking Conversions in AdWords

The AdWords blog has recently published a post about how they are changing their conversion metrics.

Directly from their post:

Today we’ve taken the first step by clarifying the conversion terminology on the AdWords Report Center and conversion tracking tool pages. “Conversions” columns are now labeled Conversions (1-per-click), while “Transactions” columns are now called Conversions (many-per-click). The current AdWords campaign management pages display 1-per-click conversions, so if one click leads to multiple conversions, they’re counted only once. On the other hand, many-per-click conversions count each conversion that occurs after a click on your ad.

So Google has essentially separated the two designations by the amount of traceable leads generated by unique user.

Below, I’ve listed a few examples of when it might be beneficial to track and account for multiple conversion actions generated by a single user.

When You Have Multiple and Varied Conversion Actions Defined:

Some accounts define users making it to a certain page as conversion, while others may track white paper downloads, contact forms, orders, newsletter subscriptions, etc. Assuming you have goals tracked in Analytics or are using a different third party tracking that allows you to see which specific actions were complete, its probably necessary to allow AdWords to count each of these actions. A user who, over the course of a month, signs up for the newsletter, accesses 2 white papers, and fills out a contact form is certainly more valuable than one that makes it to a certain page. By allowing AdWords to track each conversion for him or her the aggregate account data can begin to display that.

When You Track CPA by Specific Action:

If you track cost per acquisition by the different type of traceable conversion action, then it is only fair to allow for one user to perform multiple actions.

When You Have a Shopping Cart or are an e-Commerce Site:

Here is probably the most obvious situation where multiple conversions are worth tracking. Not only does the unique user provide value and revenue for each conversion action, here you can get a more accurate estimation of what the typical value of a order is, as well as factor in proper variable costs (shipping, etc).

Also, since the AdWords cookie lasts for 30 days, conversions that span different months, quarters, or reporting periods can accurately be tracked by allowing multiple conversions per user.

When Not to Track Multiple Conversions From One User:

Mostly you want to limit conversions to one per user when counting multiple conversions will deflate your CPA and inflate your Conversion number while not providing any real additional value to the advertiser.

One instance that comes to mind is if your only conversion action is white papers or other marketing materials. If you spend $100 to attract one user who downloads 10 white papers AdWords would display your cost per acquisition at 10 dollars per conversion. Imagine this on a greater scale and 50 people behave this way. The advertiser would certainly be confused if you tried to explain that they had 500 conversions at 1/10th the actual cost of acquisition.