The metrics to check first when Google Ad performance dips
Start by looking at the core metrics behind the change: include higher CPCs, lower conversion rates, weaker average order value or reduced demand and search volume.
Let’s get into them all in more detail:
Industry average or trend changes
Before jumping into the nitty-gritty of your account, how are you performing against your competitors? There might also be a wider change in shopper behaviour across your industry, like a new trending alternative that can be spotted in Google Trends.
CTR
Click-through rate shows how often people click your ads after seeing them. If CTR drops, shoppers are still seeing your ads in their feed, but they are choosing not to click. This could be caused by weaker product relevance, poor titles, less competitive pricing, lower carousel position or simply stronger competitor listings.
CPC
Cost per click shows how much you are paying for traffic. If CPC rises, you may be facing more competition in the auction, lower ad relevance, weaker expected CTR or a shift towards more expensive search terms. A higher CPC is not always bad, but it needs to be justified.
Conversion rate
Conversion rate shows whether your paid traffic is turning into customers. If CPC and CTR are stable but ROAS drops, the issue may be what happens after the click. This could point to landing page speed, product availability, pricing, delivery costs or checkout friction.
ROAS
Return on ad spend is the metric most teams look at first, but it is usually the result of several other changes. ROAS tells you that performance has moved, but not why it has moved.
Impression share and visibility
If impression share has dropped, your products may be appearing less often in the carousel. That could be due to budget, bids, product eligibility, feed issues or stronger competitors.
How to tell if the issue is market-wide
A performance dip may not be your account’s fault if similar advertisers in your industry are seeing the same movement. For example, if your CTR has dropped but the industry benchmark has also fallen, the issue may be broader than your ads, and it could suggest that shoppers are engaging less across the category.
If your CPC has increased, but CPCs are rising across your whole vertical, the increase may reflect greater market competition rather than an isolated account problem.
This is where our e-commerce Google Ads benchmarks become useful. It helps you understand whether your performance is moving in line with the market or drifting away from it. A benchmark does not tell the whole story, but it gives you a reference point - which helps!
Signs the issue is probably inside your Google Ads account
Common warning signs to look out for if your Google Ads performance dip is more likely to be account-specific:
- Your CPC has risen above your industry benchmark
- Your CTR is below the category average
- Your bestsellers have suddenly lost visibility
- Your product titles are vague or missing key search terms
- Your feed has missing attributes important to your product
- Lower-converting products suddenly perform better
- Conversion rate has dropped while traffic volume remains stable
- Product availability or pricing has changed
- Tracking or attribution has recently been updated
In these cases, the problem may sit within your account setup, feed quality, product relevance or post-click experience.
For e-commerce advertisers, this is especially important. Google Shopping performance depends heavily on how well your product data matches shopper intent. If your titles, descriptions, attributes or images are weak, your products may struggle to win the right clicks.
Signs that the issue is probably in the market performance
Common signs that a performance dip is more likely to be market-wide:
- CPCs are rising across your business category
- CTR is falling across similar retailers and your competitors
- Competitors are becoming more aggressive
- Seasonal demand has softened
- Promotional periods have ended
- Search demand is shifting away from your products
What to do if the above ring true? In this situation, you need to focus on prioritisation. That could mean protecting visibility on your most profitable products, reducing waste on weaker SKUs, improving feed quality or adjusting targets to reflect current market conditions.
But do not change everything in your Google Ads Account at once!
One of the biggest mistakes advertisers make after a performance dip is changing too much too quickly. If you adjust budgets, targets, product groups, feeds and campaign structure at the same time, it becomes difficult to understand what actually helped or hurt performance in the first place.
A better approach is to diagnose the likely cause first and work your way from there. If CPC has increased in line with the market, focus on reviewing product-level profitability, feed relevance and bid prioritisation. If CTR has fallen below the benchmark, review product titles, images, pricing, and offers. If conversion rate is the cause of the drop, but traffic quality looks stable, review the landing page experience, delivery proposition, checkout process and stock availability.
Final takeaway
A Google Ads performance dip should not trigger panic and sudden changes, but not everyone has the best tools at hand to perform a better diagnosis. Rather than“why did performance drop?” ask yourself, “Did performance drop because of our account, or because the market changed?”
If the issue is market-wide, you can adjust expectations, prioritise your strongest products and avoid overreacting to normal industry movement. And if this is the case, it will cause a lot fewer headaches than trying to edit your whole account from the inside.
If the issue is internal, you can focus on feed quality, campaign structure, product relevance and conversion rate. But again, before making major changes, compare your performance against the wider market.
Once you know the answer, you can make better decisions.
