My favorite method of tracking is to set a cookie when the visitor gets to the site based on the campaign / advertisement variable, and then follow those cookies through the site - noting where they drop off the site (if they do) and what percent convert to sale or action.
Then you can chart based on the accumulated data, and use it to 1) improve your ads 2) target better keywords based on what converts and 3) improve your site based on their usage.
Adwords is the *best* real time testing suite on the net - bar none. Used well with some software and you have yourself the ultimate competitive advantage.
set a cookie when the visitor gets to the site based on the campaign / advertisement variable
This variable you mention - is it transferred from Google, or do I need to set it manually in the URL e.g. www.widgets.com?campaignXYZ
bcc1234:
Any affiliate tracking software to recommend?
One of the challenges I face is that my widgets are well in the 15$K-35$K range - so we don't relly sell OVER the web, but rather WITH the web. So it's not direct ROI tracking, but more gettin new perspective customers to hand over to our sales staff.
Use a different phone # for web inqueries, versus your other marketing efforts - so you can track that way. If possible, use one phone # for adwords, another for other PPC ads, and a 3rd for your "regular" visitors to your site.
You'll need to add the variable to your campaign - eg, your url for link in Google would be:
http://wwWebmasterWorldidgets.com/?source=adwords&track=advert1
Then you can set a cookie based on that unique creative, etc - it really depends on how "deep" you want to go with it.