Realistically, nobody wants to spend their entire day buried inside Google Analytics or some other analytics package looking at numbers. But, there’s a lot of information in there that can help optimize PPC (Pay-Per-Click) advertising campaigns. So, let’s take a few seconds to think about the basics.
Firstly, most analytics packages allow you to segregate organic traffic from PPC traffic. This is important, because you’ll want to see if one is performing better than the other, and why. What’s most important is that you also have established some “Goals” in your analytics service that allow you to track conversion rates (a conversion takes place when a goal is reached). If you’re not tracking conversions, then it will be very difficult to determine the “value” of traffic. If you haven’t setup goals, then set them up now. You can even define funneled goals, which allow you to see how traffic progresses from landing pages to final action pages (eg. each step through a shopping cart).
Once you’ve got all of that set up, I highly recommend analyzing the goal conversion rates on at least the top referring keywords, for both organic SEO traffic and PPC traffic. However, take a look at the organic keywords first.
You’ll probably find that most keywords produce conversions at a rate relatively close to that of the overall average conversion rate. However, you will almost invariably find some obscure keywords that have extremely high conversion rates. These high-converting keywords can be nuggets of gold. Once you identify the top-converting SEO/organic keywords, you need to make sure that you have an appropriate bid in your PPC campaigns for them.
You can also work in the opposite direction i.e. look for top-converting PPC keywords, and then make sure you’ve fully optimized your site for them.