Quality Score (QS): Advertisers who bid the highest price are not necessarily guaranteed the top position. The higher your Quality Score, the higher you rank and the less you pay overall for each click. Factors that affect Quality Score include keyword relevance, click through rates, and landing page quality.
Click through rates (CTR): Click through rate refers to the percentage of users who see your ad and those that click through to your landing page. This is perhaps one of the most important metrics as it affects Quality Score and even how much you pay.
Cost per conversion: AdWords is ultimately about driving clicks to your pages and increasing sales. Cost per conversion is calculated as the total amount spent and the number of conversions. The higher the number this is the more you pay to attain a single conversion.
Conversion rate: Every campaign has a different go weather to increase sales or sign ups on your website. Understanding conversion rate is the key to measuring the success of your campaign and how well your ads are performing.
Cost per click: This is another variable that changes on a daily basis depending on how competitive the keywords you bid on are. Monitoring this metric lets you more effectively manage your bids and even reduce your average cost per conversion.