Industries’ Conversion Value by Google’s AdWords
Business2Community wrote an article couple days ago about Google’s AdWords. The author of this article did some research on the conversion rate and cost per conversion of AdWords for different industries. Different customers define “conversions” differently. But generally, each industry defines it similarly, so this article reports the average conversion rate data for the top 10 industries that use AdWords the most. The categories are Finance, Travel, Shopping, Jobs & Education, Internet & Telecom, Computers & Electronics, Business & Industrial, Home & Garden, Auto & Vehicles, and Beauty & Fitness. It reports that the Internet & Telecom industry is doing best with the highest conversion rate, and the Finance industry has the second highest average conversion rate. It also shows that the Finance industry has the highest cost per conversion rate, and Business & Industrial has the second highest cost per conversion rates.
This article is relevant to the ad slot selling situation we learned in class. Instead of doing calculations per click, the metric here is conversions. Naturally, it makes sense that different industries have different values for conversions. For example, in the travel industry, where customers do lots of research before buying due to the high expenses in the travel industry, getting a conversion is a big deal. If we take the ratio of the cost per conversion to average conversion rate, we have a sense of the relative conversion value for each industry. Here is the list of the ratio value of cost per conversion to average conversion rate for each industry for Google Search:
| Travel: 20.00/1.45 | $13.79 per % conversion |
| Home & Garden: 34.39/2.21 | $15.56 per % conversion |
| Shopping: 6.98/3.58 | $1.95 per % conversion |
| Business & Industrial: 39.48/4.23 | $9.33 per % conversion |
| Auto & Vehicles: 22.61/4.29 | $5.27 per % conversion |
| beauty & Fitness: 24.34/4.56 | $5.34 per % conversion |
| Computers & Electronics: 29.02/4.79 | $6.06 per % conversion |
| Jobs & Education: 29.56/6.09 | $4.85 per % conversion |
| Finance: 50.49/6.12 | $8.25 per % conversion |
| Internet & Telecom: 17.70/6.27 | $2.82 per % conversion |
From looking at these data, the shopping industry has the lowest conversion value. Home & Garden has the highest conversion value, and Travel has the second highest. This reflects the conversion difference described before.
Source: http://www.business2community.com/online-marketing/whats-a-good-conversion-rate-on-google-adwords-average-conversion-rates-by-industry-0318438