A great post!
I track this at the 'Ad Group' level, but store the full referrer string in a database for further analysis. E.g. the Ad Group could be 'Yellow Widgets', with several keyword variations associated with it. 'buy yell widgets', 'cheap yellow widgets', 'big yellow widgets', etc.
At the end of the URL from Adwords to my site, I add something like this: ref_ID=18
e.g.
Code:
http://www.mysite.co.uk/yellowwidgets.php?ref_ID=18
In a database table I store 'yellow widgets' with ref_ID '18'
When the user lands on my site I assign them a user_ID which is stored in a database table with the ref_ID 18. I also add the full referrer string to the same row in the database. So the database table consists of 3 fields: user_ID, ref_ID, referrer_string.
Each new user gets a new row in the db table.
Finally, when a user clicks through to the merchant site, via one of my affiliate links, I append their user_ID to the tracking code (epi, k, clickref, etc). When a sale is reported on the affiliate network I can cross reference the user_ID against the original search terms used. You should soon get an idea of which keywords are converting well.
You can of course dispense with the whole user_ID bit, and just send the keywords or adgroup as your tracking ID, but it is generally better to withold this info from merchants wherever possible. Your don't want your best converting keywords getting into the wrong hands!
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