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Google Ads Conversion Tracking with Google Tag Manager

Last Modified on June 6, 2024

Do you require further insight into your users’ activity and understand the performance of your campaigns?

Google Ads can drive more traffic to your website, but measuring ROI (Return on Investment) is crucial to ensure you spend your money wisely.

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If you’re running campaigns, it is fundamental to set up Google Ads conversion tracking to measure the effectiveness of your campaigns. Conversion tracking is crucial for your optimization process. Usually, you would expect a developer to set it up for you, but you can do it yourself if you cannot reach your developer.

In this tutorial, we’ll learn how to set up Google Ads conversion tracking in Google Tag Manager (GTM).

Here is an overview of what we’ll cover:

Are you excited to explore? Let’s dive in!

What is a Conversion?

Let’s discuss what a conversion is, so we are all on the same page.

A conversion is any valuable action you want a website visitor to take, i.e., the user buys a product or submits a form.

In Google Ads, here are the steps for recognizing conversion actions.

  1. A user sees your ad.
  2. A user clicks on the ad and goes to your website.
  3. A user makes a valuable action you want this user to take.
  4. Google Ads receives the conversion data.
  5. You can see what ad clicks led to the successful outcome (conversion).

Viewing conversion data in Google Ads can help you understand how your campaigns perform. It helps determine what is more effective, defining more clearly the optimization steps.

To start, you need a few things set up and ready. First, you need a Google Ads account.

Google Ads account

Next, you also need a Google Tag Manager account.

Google Tag Manager account

Ensure that you already have GTM implemented on your website.

🚨 Note: If you don’t know how to create a Google Tag Manager account or don’t know where to get started, we recommend checking out our guide on How to Install Google Tag Manager.

Finally, you should have an eCommerce store. We have this demo shop, which we built using WordPress. So, we will use this for our tutorial.

eCommerce store demo shop

You might have a different eCommerce store or a different CMS platform, which is fine. There is no need to worry because the implementation process is universal.

We need to understand the logic behind the implementation, and you can easily set up Google Ads conversion tracking on your own in any website/CMS platform.

Now that we have everything, let’s hone in on the conversion we want to track.

For this part of our tutorial, we have a sign-up form, and we want to track whenever a user fills up this form and submits their details.

Sign-up form in the demo shop

Let’s quickly fill it in and fulfill the action we want to track. I will use the Lorem Fill Chrome extension to make his process easier and faster. Once you’ve installed this on your browser, right-click on the form field and select Lorem Fill this single element.

Filling the form field with Lorem Fill

💡 Top Tip: Check out our list of the Top 10 Chrome Extensions for Digital Marketers to learn other Chrome extensions that can aid with your digital marketing works.

Once you’ve filled everything in, click Submit.

Submitting details for the sign-up form

 Now we see this thank you page, which is also what our clients see when they submit this form.

Thank you page upon submitting the form

Let’s have a look at the URL. Here, we have the sign-up-form/success text after our website domain.

Form thank you page URL

Note this URL because we will need it later.

We want to track this thank you page because this confirms a successful form submission. How do we do it? Let’s start by going to our Google Ads account.

Creating a Conversion in Google Ads

If you have used Google Ads before, you’ll notice that it now has a new interface.

Google Ads’ new interface

Even though I’m not a big fan of the new one, it is essential to adapt and move on. We can revert it to the original view if we want, but I will continue with this new one for the rest of our tutorial.

However, if you want to change it to the original design, go to AppearanceUse Previous Design.

Changing the Google Ads appearance to the previous design

Next, Google will ask you why you want to change it to the previous design. Finally, click Send and Go to Previous Design.

Switching to the previous design confirmation window

Life is about changes, right? So I have decided that we have to push ourselves out of our comfort zone and test the new interface.

The conversion setup process is pretty straightforward.

Here’s how to set up conversion tracking in Google Ads:

1. Go to GoalsConversionsSummary.

Here, we have a list of all the conversions we have configured.

2. To create a new one, click New conversion action.

First method of creating a new conversion action

Alternatively, we can also click on the Create (+) button at the upper-left corner of the page.

Clicking the Create button

3. Next, click Conversion action.

This method is a kind of shortcut for creating new conversions, which is very convenient.

Second method of creating a new conversion action

Follow any method of creating a new conversion action so that we can start our Google Ads conversion tracking.

First, we must select the kind of conversion we want to track. In our case, we want to track website actions from our eCommerce store.

4. Select the Website option and click on Next.

Tracking website actions

Next, we need to enter our website URL. Google Ads will scan our website and determine if it can measure website conversions on our site.

5. Paste your website domain, then click Scan.

Scanning your website where you want to measure conversions

We don’t want to set up our conversions directly in the interface because we want to do it via Google Tag Manager.

Why? We want complete control over our Google Ads conversion tracking and keep everything in one place, neat and well-arranged.

6. Click Add a conversion action manually.

Adding a conversion action manually

We’ll reach the conversion action details page. Here, we have various configuration fields where we need to provide details about our conversion.

Conversion action details page

First, we have the Goal and Action Optimization field. We must specify the goal category for the conversion. We can then use these categories to group conversion actions and segment your campaign reports.

7. In our case, remember that we want to track a sign-up form. so select Sign-up.

Specifying the sign-up category for the conversion

Next, we need to specify the Conversion Name. Select a descriptive name for your conversion, so that you can quickly recognize it from a list, especially if you plan to track multiple conversions.

8. Let’s keep it simple by naming our conversion Sign-Up Form.

Setting the conversion name for the sign-up form

Then, we have something called Value. This field helps measure the impact of your advertising by assigning a value to your conversions. 

Google Ads recommends the following: use the same value for each conversion if you’re tracking leads, sign-ups, or page views, and different values if you sell multiple products at different prices.

In our case, I don’t want to use a value for this conversion action, even though Google Ads does not recommend this. Not setting a value means that the revenue we generate or the exact monetary value of this conversion is zero.

9. We are just tracking a sign-up form, so I won’t assign a monetary value to it. So, we will select the option: Don’t use a value for this conversion action.

Setting no value for the conversion

Next, we have Count. This field dictates how often we count the conversion for each person who clicks our ad. Here, we have two options: Every and One.

Google Ads gives you some hints here. Option One is for leads and sign-ups because it makes sense that a user will sign up only once on your website. Meanwhile, we will select Every for purchases because even if the same user purchases multiple items multiple times, each is valuable.

10. Since we have a sign-up form, select One.

Selecting the One count option

11. Next is the Click-Through Conversion Window, set to 30 days by default.

Click-through conversion window field

What does this field mean? It is the given time frame that you allow your users to convert after interacting with your ad.

Since conversions can happen days after a user first interacts with your ad, this window is the maximum time after the ad click that you allow the conversion action to count as a conversion.

Let’s say a user clicks on your ad. However, they only completed the order after a few days because they looked for other alternatives before ultimately buying your product. Google Ads will count this purchase as a conversion if it is within the specified timeframe.

If you’re selling expensive products, it is natural for people to take some time and ponder the decision of purchasing something expensive. You may want to play around with the settings and extend this window the pricier your products are.

The click-through conversion window can be between 1 to 90 days.

12. Then, we have the Engaged-View Conversion Window, which is set at three days by default.

Engaged-view conversion window field

This conversion window is the period you give your users to convert after they watch at least 10 seconds of your video ad.

The engaged-view conversion window can be between 1 to 30 days.

13. Next is the View-Through Conversion Window, which is set to 1 day by default.

View-through conversion window field

This conversion window is an interesting one, though. View-through conversions are for when customers see but don’t interact with your ad, and then convert to your site.

They are a helpful way to track the value of your video and display ads. Check out this link if you want to learn more about display ads.

Since these ads show when the user is consuming other content, the subtle impact of your ads for brand awareness can be harder to track. Enabling view-through conversions gives us a rough estimate of the ad’s effectiveness.

This type of conversion is intriguing because users aren’t interested in clicking your ad, but familiarity with your brand still can cause the user to convert to your website.

We will leave this for now, because conversions after may be best attributed to other factors and not directly due to the ad the user saw.

The view-through conversion window can also be between 1 to 30 days.

14. Then, we have the Attribution field. It is Data-Driven by default.

Attribution field

Let’s say you’re running multiple ads. Some users may click on the first one, then the second, and so on. Later, after clicking on the fifth ad, they finally decide to make a purchase.

How can we identify which ad was the most effective? Which ad led to the most successful outcome? The attribution model determines how much credit each ad interaction gets for your conversions.

For example, let’s continue with our scenario where the user clicks on multiple ads before completing a purchase. If you select the last-click attribution model, all the credit will go to the last-clicked ad.

🚨 Note: We will not discuss the different attribution models today. You can learn more about the attribution models in Google’s official documentation.

One important thing to keep in mind is that the first click, linear, time decay, and position-based attribution models across both Google Ads and Google Analytics 4 will be going away soon.

Aside from the fact that these models don’t provide the flexibility needed to adapt to evolving consumer needs, less than 3% of Google Ads web conversions use these models.

This decline is due to data-driven attribution becoming the most used attribution model for conversions using automated bidding in Google Ads.

Starting July 2023, you can no longer select these models for conversion actions in Google Ads that do not already use one of these models. Then, from September 2023, Google will switch any conversion actions still using these models to data-driven attribution.

The default attribution model for most conversion actions is the data-driven attribution model. It uses Google AI to understand the impact of each touchpoint on conversions and distributes credit for the conversion based on past data.

Finally, let’s move to the final detail we should set for Google Ads conversion tracking.

15. We have the Enhanced Conversions setting. When we click on it, it says: Enhanced conversions are not configured for this account.

Enhanced conversions not configured for the account

What are enhanced conversions? Simply put, they allow you to send hashed customer data such as email addresses, phone numbers, and more to Google for more accurate tracking. You supplement your tags with additional information about your users.

However, we will not set up enhanced conversions in this guide.

💡 Top Tip: If you’re interested in implementing enhanced conversions on your website, check out our guides on How to Set Up Google Ads Enhanced Conversions with GTM and Offline Conversion Tracking: Enhanced Conversions for Leads.

16. Finally, click Done.

Submitting the conversion action details

17. Ensure your conversion action is recognized, then click Save and continue.

Saving the conversion action

Great! We have successfully created our conversion. Next, we must specify how to implement our Google Ads conversion tracking.

Conversion implementation options

We have the following options:

  1. Activating measurement with the Google tag: in the source code directly.
  2. Emailing instructions to your webmaster: the webmaster will do it for you.
  3. Using Google Tag Manager to install the Google Ads conversion tracking tag.

We will use Google Tag Manager for Google Ads conversion tracking because it is easy, and this is how you can manage your tags.

Google Ads Conversion Tracking Setup with GTM

Let’s click Use Google Tag Manager. Note the conversion ID and the conversion label of our sign-up form.