{"id":10419,"date":"2024-08-27T12:33:59","date_gmt":"2024-08-27T12:33:59","guid":{"rendered":"https:\/\/smarter-ecommerce.com\/blog\/en\/?p=10419"},"modified":"2024-10-28T15:23:30","modified_gmt":"2024-10-28T15:23:30","slug":"click-vs-bought-and-google-ads-profitability","status":"publish","type":"post","link":"https:\/\/smarter-ecommerce.com\/blog\/en\/google-ads\/click-vs-bought-and-google-ads-profitability\/","title":{"rendered":"Google Ads profitability: Why clicks aren’t telling the whole story"},"content":{"rendered":"\n

If you\u2019ve ever been thrilled by the click-through rates on your Google Ads, only to be disappointed by the actual sales:\u00a0Welcome to the club.<\/strong> This\u00a0“clicked vs bought” phenomenon<\/strong>\u00a0is a sneaky little challenge that can make your campaigns look more impressive than they perform\u2014and\u00a0could be costing you more than you think!<\/strong> Stick around to see how this ties into Google Ads profitability optimization.<\/p>\n\n\n\n

The hidden chaos in your Google Ads<\/h2>\n\n\n\n

Which of your products are truly profitable, and which might be dragging you down?<\/p>\n\n\n\n

Do you really know the answer?\u00a0Let’s break it down.<\/strong><\/p>\n\n\n\n

This is what you want. This is what you get!<\/strong><\/h3>\n\n\n\n

There’s a sneaky little challenge hidden in your Google Ads we like to call the\u00a0clicked vs bought phenomenon.<\/strong>

It happens when shoppers are lured into your shop by clicking on your high-margin designer handbags, only to buy a more budget-friendly alternative from a lesser known brand instead.\u00a0<\/p>\n\n\n\n

What’s the problem with that?<\/strong><\/h3>\n\n\n\n

While it’s generally true that winning a sale is better than no sale at all, it comes at the detriment of\u00a0sustainable business growth.<\/strong>

For starters, you would’ve\u00a0gained more profits<\/strong>\u00a0if your shoppers actually bought the high-margin designer bags they initially clicked on.

To make matters worse, Google\u00a0assigns the order value<\/strong>\u00a0to the\u00a0clicked product<\/strong>, not the items they\u00a0actually purchased<\/strong>. This way, your ad spend is credited to drive revenue, but not necessarily profitability.

This, of course, also means you might be overspending on ads<\/strong>\u00a0that simply don’t\u00a0convert. No matter how impressive their CTR is!<\/p>\n\n\n\n

Want more clarity? Hand over your data!<\/strong><\/h3>\n\n\n\n

Now, Google is aware of this discrepancy. Which is why they offer two key data integrations to optimize your campaigns for gross profit:<\/p>\n\n\n\n

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  1. Conversions with Cart Data:<\/strong> This allows Google to see not just the value but also the composition of each order. <\/li>\n\n\n\n
  2. COGS attribute:\u00a0<\/strong>Adding the Cost of Goods Sold (COGS) to your feed allows Google to calculate the gross profit on a per-product basis.\u00a0<\/li>\n<\/ol>\n\n\n\n

    But here’s the catch: <\/strong>Advertisers are understandably hesitant to share this kind of data for several reasons –<\/p>\n\n\n\n