Many Web Analytics programs including Google Analytics attribute conversions and sales revenue to the LAST click - not the first visit. This makes a huge difference in where you THINK your sales are coming from and could lead to making decisions on PPC spending that severely impact your sales.

The more keywords you're using to display your PPC ads the more likely it is that potential buyers will first find your site by clicking on one of those ads. That action sets a cookie on their PC used to track any eventual sale back to that click.

If they search on one PC and buy on another the sale won't be tracked to that ad. Even more likely, there are many actions that will overwrite that cookie including:

Clicking on another PPC ad (cookie reset to that keyword instead)
Clicking on any organic listing to return to your site
Visiting your site from a referral link from a shopping or price comparison site
Visiting your site from any other source that has a referral link

If that weren't enough opportunities to lose the tracking used to gauge the effectiveness of your PPC advertising spending there are other actions that you may see in your analytics account that are most likely overwriting your PPC tracking. This is definitely true of Yahoo Store sites. They are:

Using the search function on your site if a different domain is displayed
Viewing the shopping cart and then returning to the site if the cart is on a different domain
Pages displayed from different domains during a visit (examples: www.domainname.com to domainname.com to store.domainname.com)
Any other action taken while on your site that sends them to another domain and then returns them to your primary domain

You can check your analytics program to see if there are entries from search, carts, other domains you use, and from within your site as sources of conversions.

To do this in Google Analytics go to "All Reports", "E-Commerce Analysis", "Revenue Sources", "Referring Sources". For a Yahoo Store you'll see referrals from:

order.store.yahoo.net [referral]
yourdomain.com [feferral]
store.yourdomain.com [referral]
search.store.yahoo.com [referral]

I personally see no reason why the search or order functions of your store should be referrers. The visitor is already on your site from some other source and THAT source is what you want to know. I am researching whether these things can be changed, whether Google Analytics can be reconfigured to use first referrer instead of last, and any other ways to improve tracking.

Advertisers selling products that are widely available will be most impacted by these other referrers expecially if you have your products up at froogle, nextag, bizrate, dealtime, shopzilla, pricegrabber and other price comparison or shopping portal sites.

What this means to you as a PPC advertiser is that an enormous percentage of sales actually generated by your PPC ads will not be attributed to the ads. Deciding to pause keywords or lower bids based solely on the revenue directly attributed to your PPC spending may seriously impact your income, total revenue, and profits.

If anyone knows whether these issues also appear in other Web Analytics programs or of ways to reconfigure Google Analytics to attribute conversions to first visit please do share what you know here.

I have shared what I'm seeing in multiple accounts with Monitus and ROI Revolution in hopes they may be able to provide a work-around or persuade Google to address this challenge directly. If I hear anything new I'll share it in this thread.

Michael Whitaker at Monitus has posted about this issue in his latest blog entry Who Gets the Credit . He references another post by Justin Cutroni that provides additional confirmation on How Google Analytics Tracks Conversions.

I now have many Google Adwords accounts using Google Analytics. Most of the larger ones happen to be Yahoo Stores. In those accounts, partially due to how Yahoo Stores changes domains during visits, it appears that GA may only be attributing 20-30% of sales actually generated by PPC ads to that source.

Based on what I'm seeing, I recommend advertisers be very cautious of changing advertising spend and be sure to track what happens.