Back in the days of Mad Men-esque advertising agencies, tracking how many people engaged with a particular ad campaign was nearly impossible to do well. Advertisers would sink money into mediums like radio and print, and hope sales of the advertised product went up. There was no dependably accurate way to determine how many people engaged with an ad or purchased a product because of it. In fact, the term ROI (return on investment) wasn't even widely used until the mid-1960s.

A lot has changed since then. Advertisers now have access to a wealth of granular ad tracking data for every single campaign they run -- so much data, in fact, that most marketers need to spend significant time sifting through dashboards to determine which points actually matter to their bottom line. Ad tracking has made it possible for marketers to more accurately measure, test, and revise ads based on how users interact with their online campaigns.

What is ad tracking? Ad tracking is the process of collecting data and user insights on the performance of online advertising campaigns. There are numerous methods advertisers can employ to collect this information, including tracking URLs, tracking pixels, and cookies. We'll discuss these methods below

If you're new to running online ads, it's important to spend some time thinking about the specific metrics that will determine the success of your campaign. Ad tracking today exists across a number of different tools and platforms, and advertisers have the ability to collect data on everything from views and clicks, to impressions and behavior across multiple sessions and websites.

The sheer amount of data available can be overwhelming (not to mention distracting from your goals), so deciding on one or two key performance indicators (KPIs) will help focus your efforts and make reporting more straightforward and effective.

As William Stentz, Director of Marketing Analytics at Carmichael Lynch, reminds us, "Good key performance indicators are simple, timely, critical to the success of a project, and not financial in nature. But you also need to add in one thing if you want it to be a successful marketing metric -- it must represent a key behavior you wanted to see. Look at your campaign and ask yourself: What’s the behavior I want to influence, not just something I can measure?"

We wrote an article here that can help you determine the right metrics to track based on the goals of your ad campaign.

Once you've determined the metrics you want to track for your ad, it's time to find the best ad tracking method for your purposes. The exact ad tracking methods available to you will vary based on where you run your ads and which tools you're using, but here are a few basic types to keep in mind. It's important to note that the following ad tracking methods aren't mutually exclusive -- in fact, when used together they can provide even more powerful insights.

Tracking URLs

A tracking URL is a normal page URL from your website with a tracking token added to the end of it. Here's an example landing page URL by itself, and with a tracking token (in bold).

Regular old landing page URL:

http://www.yourwebsite.com/your-landing-page/

Landing page URL with a tracking token:

http://www.yourwebsite.com/your-landing-page/?utm_campaign=test-campaign&utm_source=email

As you can see, the page URL is the same in both cases, but in the second case, there's some extra stuff added to the end. This extra stuff is your tracking token, also called a UTM parameter.

So how does this "extra stuff" help you track things, exactly?

When a user clicks on a URL with a UTM parameter added to the end, it essentially sends a signal back to your ad tracking tool that the URL was clicked. The "source=_____" bit of the tracking token can provide information about where the user clicked the link. Similarly, the "campaign=_____" bit can be used to signal to your tracking tool that the link should be bucketed as part of a campaign.

For example, if you were to run the same ad on multiple websites and wanted to know which one generated the most clicks, you could define the two different websites as sources in the UTM parameters of your links.

You can learn more about tracking parameters and how they work in this article.

Best for: If you're running a PPC campaign, sending an email, or putting an advertisement on another website, tracking URLs are ideal for calculating the number of visits, leads, and conversions you've generated from your hard work.

Tracking Pixels

A tracking pixel is a tiny, often transparent, 1px by 1px image that can be placed in an email, display ad, or simply on a webpage. When it loads, it sends a signal back to your tracking tool that a user has viewed the page.

Tracking pixels are also capable of collecting pretty comprehensive data about a user's activity and browser configuration -- but you should only ever track information that is directly useful to your buyer's journey and will provide a better, more personalized experience for your target users.

When used correctly, tracking pixels can help optimize your ads and get them in front of a receptive audience. For example, if you run a banner ad with a tracking pixel, you'll be able to gather information about how many people just view versus actually click on your ad, which will help you determine whether or not an ad was actually successful (and worth running again).

For context, here's how big a tracking pixel appears (no, that's not just a speck of dust on your screen):

Best for: Tracking pixels are incredibly useful for tracking the success of your online campaigns through every step of your conversion path. They can give you insight into how users are interacting with your ads, and help you optimize each stage of your user journey from initial touch through final purchase.

Cookies

Cookies can help you gain insight into user behavior on your website across multiple sessions of activity. Marketers need to gain explicit consent from users before using cookies to track their activity. When explicit consent is given, cookies can be used to customize a user's experience. Here's a deeper dive on cookies if you want to learn more about the technical aspects of how they function.

From an ad tracking perspective, cookies are the driving force behind most ad retargeting campaigns. Cookies can be used to essentially build a user profile based on someone's web activity and habits, and advertisers can leverage this profile to serve ads that align with a user's observed interests. They can also capture information about a user's browser configuration, location, and preferred language.

Best for: Cookies are ideal when you want to serve a user ads aligned with their web browsing activity, or retarget them with ads for products they've demonstrated an interest in. Cookies can also be used to create a personalized experience for users on your website based on their previous interactions with you -- for example, you could create an abandoned cart email when users put items in their cart and then leave your website.

Now that we've gone over a few core terms related to ad targeting, let's take a deeper look at how ad targeting functions on a few of the biggest ad tracking platforms, and how you can use it to make your own ad campaigns stronger and more effective.

DoubleClick Ad Tracking

If you've ever noticed an ad for a product you viewed weeks ago following you around on the internet, it's likely the result of DoubleClick ad tracking. DoubleClick, which was acquired by Google in 2008, is an ad management and ad serving platform that enables marketers to run ad campaigns across multiple channels.

Online publishers use DoubleClick to essentially rent out ad space on their websites, and agencies and advertisers use the product to place ads on websites where their target audiences are spending time.

In 2012, Google rebranded their DoubleClick products as Google Marketing Platform (formerly DoubleClick), Google Ads (formerly Google AdWords), and Google Ad Manager (formerly DoubleClick for Publishers and DoubleClick Ad Exchange).

Google offers advertisers a number of different ad tracking options when they create campaigns on the platform -- most of which rely on the use of cookies.

According to Google, "Cookies themselves contain no personally identifiable information. Depending on the publisher’s and user’s settings, information associated with cookies used in advertising may be added to the user’s Google Account."

These generic cookies can collect information on the time and date you viewed particular ads, the specific web pages you were on when you viewed an ad, and your IP address -- which can help the cookie infer where you're located.

Although the cookies contain no personally identifiable information, Google can combine the information it obtains via cookies with the personally identifiable information associated with your Google Account (which includes your browsing and search activity when you're logged into Google -- which, for most of us, is pretty much always).

Google leverages two main types of cookies: first-party and third-party.

First-party cookies are dropped (i.e., assigned to a specific user) by the owner of the website you're visiting. Information collected via first-party cookies can help publishers better understand your activity on their site and how ads are performing.

Third-party cookies are dropped by an advertiser on a website where their ads are being displayed. These cookies send information back to advertisers about how their ad campaigns are performing across all the websites where their DoubleClick ads are being displayed.

Over 11.1 million websites currently run ads as part of Google's AdSense network. If you visit a website within the network, the information collected via a DoubleClick ad tracking cookie will be pooled and leveraged by other websites and advertisers using AdSense.

This consolidation of cookie information results in an extremely rich pool of data for Google advertisers, as they can keep track of what ads you're served across millions of different websites.

To get started tracking ads with Google, you'll need to get a Google Marketing Platform account. Depending on the size of your business and your particular needs, you'll choose either an enterprise account -- which can accommodate large ad campaigns across multiple websites and mediums -- or a small business account -- with ad tracking tools more focused and specialized for early company growth.

Facebook Ad Tracking

Advertisers on Facebook can leverage a number of different ad tracking strategies to optimize ads for their audience. Facebook's ad tracking pixel is one of the more common methods. It functions similarly to the basic tracking pixel we outlined above, and can be used to track the path someone takes from viewing an ad, to visiting your website, to purchasing a product.

When an action takes place on a page where a tracking pixel has been set up, the pixel will "fire" and send that information back to your Facebook Events Manager account. Information collected via the tracking pixel can also be used in the creation of custom audiences for future ad campaigns.

For example, you could use data collected via a tracking pixel to create a custom ad audience targeting users who viewed a particular page on your website that implies purchase intent -- like a pricing page. We wrote an article that goes deeper into how the tracking pixel functions if you want to learn more about different uses and how to set it up.

While the Facebook pixel can offer advertisers valuable insights into how ads are influencing specific actions on their websites, it's not the only way to track ads on the social network.

Another ad tracking option available to you is adding UTM parameters to links that appear on your ads. As we discussed above, tracking parameters use extra code on a URL to "fire" when a user loads the link. On Facebook, they can be used in Ads Manager to better understand which ads you're running are driving which types of traffic.