The Only Google Ads Metrics That Matter for Lead-Gen Businesses

You log into Google Ads. You’re immediately overwhelmed with data. Impressions, clicks, CTR, average position, impression share, Quality Score, search impression share lost to budget, search impression share lost to rank, top impression rate, absolute top impression rate…

Most businesses track the wrong metrics. They obsess over impressions and clicks because those numbers are big and feel impressive. “We got 50,000 impressions this month!” Great. How many customers did you get?

Impressions and clicks don’t pay the bills. Customers do.

For lead-generation businesses, only 5-6 metrics actually matter. Everything else is noise—or at best, secondary signals that provide context but don’t determine success or failure.

This article cuts through the noise. I’ll show you which metrics to track daily, weekly, and monthly, which metrics you can completely ignore, and what red flags to watch for that signal problems you need to fix immediately.

Stop tracking vanity metrics. Focus on profit.

Vanity Metrics vs. Metrics That Matter

Let’s define terms. Vanity metrics are numbers that look good in reports but don’t directly correlate with business results. Metrics that matter are numbers that directly tie to revenue and profitability.

Vanity Metrics

Impressions: How many times your ad was shown. Doesn’t tell you if anyone cared.
CTR (alone): Click-through rate without conversion context is meaningless. You can have a 10% CTR and zero customers.
Clicks: Traffic for the sake of traffic. Paying for clicks that don’t convert is wasted money.
Average position: Where your ad showed on the page. Google has mostly replaced this with “top” and “absolute top” metrics anyway, and position alone doesn’t predict conversions.

Why Vanity Metrics Mislead

Example: You run two campaigns.

Campaign A: 10,000 impressions, 500 clicks (5% CTR), 10 leads, 3 customers, $300 revenue per customer = $900 revenue, $500 ad spend = 80% profit margin.

Campaign B: 50,000 impressions, 2,500 clicks (5% CTR), 25 leads, 5 customers, $300 revenue per customer = $1,500 revenue, $2,500 ad spend = -40% loss.

Campaign B has 5X the impressions and 5X the clicks. It looks way better on vanity metrics. But Campaign A is profitable and Campaign B is losing money.

Vanity metrics made Campaign B look successful when it was actually bleeding cash.

Important Caveat: Context Matters

The vanity metrics are decent signals as campaigns get going, and depending on what type of business.

In my furniture business days, for example, the furniture customers would see ads and then come to the physical store. There wouldn’t necessarily be a direct conversion on the site. So looking at click rate, cost per click, the traffic, and the quality of keywords were some things that we also monitored as indicators of whether we were reaching the right people.

If you saw high CTR on “modern furniture Los Angeles” and then foot traffic increased at the showroom, that CTR was a useful signal even without direct online conversions.

But for most lead-generation businesses—plumbers, HVAC, lawyers, contractors, local services—vanity metrics are secondary at best. You get direct conversions (forms and calls), so you can measure real results. Focus on those.

The 6 Metrics That Actually Matter

Here are the only metrics you need to obsess over.

1. Conversions (Leads)

What it is: Total number of leads—form submissions plus phone calls.

Why it matters: This is the only metric that directly measures results. You’re running ads to generate leads. How many leads did you get?

Everything else flows from this number. No conversions = campaign failure, regardless of how good your CTR or impression share looks.

What to track:

Total conversions
Conversions by campaign
Conversions by keyword (which keywords actually drive leads?)

How to track it: Google Ads conversion tracking (covered in Chapter 6.2 and 6.3). Make sure you’re tracking both form submissions and phone calls.

2. Conversion Rate

What it is: Percentage of clicks that become conversions. (Conversions ÷ Clicks) × 100.

Why it matters: This tells you if your landing page and offer are working. You can have thousands of clicks, but if your conversion rate is 0.5%, something is broken.

Industry benchmarks:

Most lead-gen businesses: 3-10%
Emergency services (plumbing, HVAC, locksmith): 5-15%
Legal services: 3-8%
B2B services: 2-5%

What a low conversion rate means:

Landing page is broken or slow
Message mismatch between ad and landing page
Offer isn’t compelling
Form is too long or complicated
Wrong audience (targeting problem)
Tracking is broken (check this first)

If your conversion rate is below 2%, something is seriously wrong. Fix it before spending more money.

3. Cost Per Conversion (Cost Per Lead)

What it is: How much you pay, on average, for each lead. Total ad spend ÷ total conversions.

Why it matters: This determines whether you can afford to keep running ads. If leads cost $500 and your average customer is worth $300, you’re losing money on every lead.

What’s acceptable varies by industry:

Home services (plumbing, HVAC): $50-200 per lead
Legal (personal injury, DUI): $200-800 per lead
Roofing/solar: $100-400 per lead
Medical/dental: $50-150 per lead

These are rough averages. Your acceptable cost per lead depends on your close rate and customer lifetime value (we’ll calculate this in Chapter 7.3).

What drives cost per lead:

Competition (more competitors = higher costs)
Quality Score (better QS = lower costs)
Conversion rate (higher CR = lower cost per lead)
Geographic area (major cities cost more than small towns)

4. Lead-to-Customer Conversion Rate

What it is: Percentage of leads that become paying customers. (Customers ÷ Leads) × 100.

Why it matters: This is the most important metric for ROI. You can generate 100 leads at $50 each ($5,000 spent), but if only 2 become customers, that’s $2,500 per customer. If they’re only worth $1,000 each, you’re losing $1,000 per customer.

Important reality check: This is sometimes difficult for smaller businesses to truly count, and most don’t know this number out of the gate, so it takes observation and tracking to try to dial this number in.

When you first start running ads, you won’t know your lead-to-customer rate. You’ll need to track manually for 2-3 months:

How many leads came in?
How many became customers?
Calculate the percentage

Many small businesses don’t have CRM systems tracking this automatically. That’s fine. Keep a simple spreadsheet:

Date
Lead source
Did they become a customer? (Yes/No)
How much did they spend?

After 30-50 leads, you’ll have a reliable average.

Typical ranges:

Emergency services with immediate need: 20-40%
Scheduled services: 10-25%
High-ticket services (roofing, solar): 5-15%

If your lead-to-customer rate is below 10%, you have a sales problem, not an advertising problem. Fix your sales process, improve follow-up speed, train your staff.

5. Cost Per Customer

What it is: How much you actually pay to acquire a customer. Total ad spend ÷ total customers (not leads).

Why it matters: This is your true cost of acquisition. This determines profitability, not cost per lead.

Example:

$3,000 ad spend
60 leads ($50 per lead—looks good!)
12 customers (20% close rate)
$250 per customer (the real number)

If your average customer is worth $800, you’re profitable. If they’re worth $200, you’re losing money.

Cost per customer is different from cost per lead. Most businesses only look at cost per lead and wonder why they’re not profitable. You need to track all the way to customers.

6. Return on Ad Spend (ROAS)

What it is: Revenue generated divided by ad spend. (Revenue ÷ Ad Spend) × 100.

Why it matters: This is the ultimate profitability metric. Are you making more money than you’re spending?

Formula:

Ad spend: $5,000
Revenue from those ads: $15,000
ROAS: 300% (or 3:1)

For every $1 you spend, you make $3. That’s a 200% profit margin on ad spend (before other business expenses).

What’s profitable varies by business:

High-margin services (legal, consulting): 200-500% ROAS or higher needed
Lower-margin services (some home services): 150-300% ROAS acceptable
High customer lifetime value (repeat customers): Can accept lower initial ROAS

To calculate ROAS, you need to know customer lifetime value. We’ll cover this in detail in Chapter 7.3 (ROI calculation). For now, know that ROAS is your north star metric—it tells you if advertising is actually profitable.

What to Monitor Daily vs. Weekly vs. Monthly

You can’t check every metric every day. Here’s what to monitor at different frequencies.

Daily (If Managing Yourself)

Spend: Are you staying on budget? Google sometimes overspends daily budgets. Check that you’re not burning through money faster than planned.

Conversions: Are leads coming in? If you normally get 2-3 leads per day and suddenly it’s been 3 days with zero, something’s wrong.

Major issues: Any campaigns paused accidentally? Website down? Tracking broken? These require immediate attention.

Time required: 2-5 minutes per day.

Weekly

Cost per lead: Is it consistent with your target? If it’s spiking, investigate why.

Conversion rate: Sudden drops indicate landing page or tracking issues.

Lead quality (anecdotal): Are the leads you’re getting qualified? Even without formal tracking, you can tell if you’re getting more junk calls or out-of-area leads.

Search terms report: Review actual searches triggering your ads. Add negative keywords for irrelevant searches. This is critical weekly maintenance (Chapter 4.2).

Time required: 30-60 minutes per week.

Monthly

Lead-to-customer rate: Calculate how many leads from this month became customers. (This may lag—some leads take weeks to close.)

Cost per customer: True acquisition cost for the month.

Total ROI: Did you make money? Revenue from customers vs. ad spend.

Quality Score trends: Are your Quality Scores improving or declining? This affects long-term costs.

Year-over-year comparison: How does this month compare to the same month last year? Seasonal businesses should track this.

Time required: 1-2 hours per month for thorough analysis.

Quarterly

Strategy review: Are your campaigns still aligned with business goals? Should you expand to new services or locations?

Major optimizations: Test new landing pages, restructure campaigns, try new bidding strategies.

Budget adjustments: Should you increase or decrease spend based on performance?

Competitive analysis: What are competitors doing? Have market conditions changed?

Time required: 2-4 hours per quarter for strategic planning.

Red Flags and Warning Signs

These are the signals that something is broken and needs immediate attention.

Conversion rate suddenly drops (from 8% to 2%): Your landing page might be broken, loading slowly, or have a form issue. Check it on mobile and desktop immediately.

Cost per lead spikes (from $100 to $250): Either competition increased, or your Quality Score dropped. Review search terms—are you showing for irrelevant queries? Check Quality Scores by keyword.

Zero conversions but lots of clicks (100 clicks, 0 conversions): Your tracking is almost certainly broken. Test your form submission and call tracking. Or your landing page experience is so bad that nobody converts.

High bounce rate (70%+ of visitors leave immediately): Message mismatch between your ad and landing page. Your ad promises one thing, the landing page delivers something else. Or the page is painfully slow to load.

Lots of impressions, few clicks (10,000 impressions, 50 clicks = 0.5% CTR): Your ad copy is weak or not compelling. Rewrite ads using the templates from Chapter 5.1.

Lots of clicks, zero conversions: Either your landing page is terrible, or you’re attracting the wrong audience. Review who’s clicking (demographics, devices, locations). Consider whether your offer resonates with the people you’re reaching.

Any of these red flags should trigger immediate investigation. Don’t wait for the monthly review—fix problems when you spot them.

Metrics You Can Ignore (Mostly)

These metrics provide context but shouldn’t drive decisions.

Impressions (alone, without context): Knowing you got 50,000 impressions tells you nothing about performance. Only useful in combination with other metrics (like if impressions dropped 80% overnight, indicating a campaign paused accidentally).

Average position: Google has largely replaced this with “top impression rate” and “absolute top impression rate.” Position alone doesn’t predict conversions—being #1 with terrible conversion rate is worse than being #3 with great conversion rate.

Impression share: What percentage of possible impressions you captured. Only matters if you’re maxed out (90%+ impression share) and want to scale further. If you’re at 30% impression share, you have plenty of room to grow by increasing bids or budget—but only if campaigns are profitable.

CTR by itself: Click-through rate is meaningless without conversions. A 10% CTR with 0% conversion rate is worse than a 2% CTR with 10% conversion rate.

Search impression share lost due to budget: Google telling you that you could get more impressions if you spent more. Only relevant if your campaigns are already profitable and you want to scale.

Don’t let these metrics distract you from what matters: leads, cost per lead, customers, and ROI.

Track What Matters, Ignore the Rest

Here’s your takeaway: Focus on leads, cost per lead, lead-to-customer rate, cost per customer, and ROI. Everything else is noise or secondary context.

Most businesses drown in data and lose sight of what actually matters. You’re running ads to make money. Track the metrics that tell you if you’re making money.

Review conversions daily, cost per lead weekly, and ROI monthly. Watch for red flags. Ignore vanity metrics.

Next, we’ll cover how to set up dashboards—automated reports that display these critical metrics at a glance, so you’re not constantly logging into Google Ads or digging through reports to find the numbers you need.