In the “What is Online Advertising?” post, I explained what are the essential and most cost effective online advertising mechanisms for small businesses. One of these is Search Engine Marketing or SEM.
So you decide to tell the world about your product or service by paying Google via its AdWords product to place ads in search results pages. The cool (and super useful) thing about advertising online is that you can track your cost and, possibly, if you have your Website setup properly, revenue from the ads.  You don’t even know how to program to do this.
You advertise on Google and you get some customers and make some money. Life is good.
Or is it?
A common question small businesses have, especially if they’re starting out with online advertising, is this: “What objective method is there to see the return on investment of my advertising campaigns?” That is, how do you know that you’re getting the most bang for your sacred small business buck?
Evaluating the results of your SEM campaigns aren’t that difficult really.
There are 2 components to evaluating whether you are getting the most bang for your advertising buck:

What are your goals? That is, why are you in business? Possible questions you should ask yourself (if you haven’t already) are: do you want to reach a certain level of income and maintain it at that level? Or do you want to keep growing your business forever? If you want to grow your business, then at what rate?  How is the income decision going to affect family time (if you have a family around)? What about social and community activities? These are questions only you can answer as a small business owner?
Once you know what your goal is, you need to come up with some metrics which help you achieve that goal. For example, you know that you want to make x dollars per month to achieve your goal. Some metrics to consider are:

Number of clicks
How much revenue was generated (RPC), if you have your Website setup to measure revenue.
Cost per click (CPC)
Profit per click (which is  RPC – CPC)
Total profit, which [... Click the title to go to the article]

First, let me make something clear- I don’t work for Google (never have), I don’t own a single Google stock, and I don’t know anyone at Google.  I only mention Google and its products because I use them and I think that they’re the best and that they will be helpful to your small businesses.
OK, now that I’ve cleared that up, as a follow up to the announcement of Google’s partnership with the SBA, Google put out a nice online booklet which summarizes the company’s offers, some reasons how you, as a small business, might benefit from them, and simple steps to get you up and running quickly.
I’ve actually used almost all of Google’s products, including AdWords (which in turn includes a bunch of really helpful keyword analysis reports), Analytics and Website Optimizer.
So, take a look at Google’s offers booklet. If you need guidance with setting up anything, don’t hesitate to Ask The Marketing Coach.
Good luck!

Tags: analysis, small business, optimization tools, reports, Web Metrics, marketing