How to track conversions with Google Adwords?

Once you are running your Ad Campaigns in Google, you have to track the conversion to make decisions on your keywords, landing page optimization and overall bidding process. You can track conversion from your Ad Campaigns using Google Adwords tracking code or by using Google Analytics code. 

Why Google Adwords Tracking Code is better?

A user clicks your Ad, reaches the landing page and gets information about your products and services, but doesn't perform the action that you have anticipated in that session. But later, after one week, he visits the page independently and performs the action, then Google Adwords conversion Code will track it as a conversion happening from your Ad Campaign(which actually is true. Your Ad was responsible for the first visit). 
With Google Analytics Code, the conversion will be measured as an independent event. Please remember that Google Adwords Tracking code tracks conversions only within 30 days from the first click.It also depends on whether the user has enabled cookies in their browser(which are enabled by default). 

Tracking Conversion in Google AdWords
1. Click the Reporting and Tools section in your Adwords account.
2. Click Conversions
3. Click 'New Conversion'
4. Enter a name for your Conversion - <Conversion Name>
5. Select the Tracking Purpose according to your Need - Purchase/Sale, Signup, Lead or View of a Key page.
6. Click Save and Continue
You will see a tracking Code generated in your Account in the following format:
<!-- Google Code for <Conversion Name> Conversion Page -->
<script type="text/javascript">
/* <![CDATA[ */
var google_conversion_id = <Google Conversion Id Generated>
var google_conversion_language = <Language Used>;
var google_conversion_format = "<Format of Google Site Stats>";
var google_conversion_color = "ffffff";
var google_conversion_label = "<SignUp/View of page/Sales -  Alphanumeric code generated by Google According to your selection>";
var google_conversion_value = 0;
/* ]]> */
<script type="text/javascript" src="">
<div style="display:inline;">
<img height="1" width="1" style="border-style:none;" alt="" src="<Google Conversion Id Generated>/?label=<SignUp/View of page/Sales - Alphanumeric code generated by Google According to your selection>&amp;guid=ON&amp;script=0"/>
Note that <Format of Google Site Stats> can be 1,2 or 3
1: Google Site Stats in One Line
2: Google Site Stats in One Line
3: No Site Stats info displayed
According to Google it is mandatory to use the 'Google Site Stats' image in your conversion page to notify the users that their visits and conversions are being tracked. 

Google Adwords Tracking Code Indicator

7. Copy the above code to your conversion pages

The conversion pages are typically 'Thank you pages', if you want to track a sale. But most often you want to analyze visitors reaching an important page in your Conversion funnel. In that case, copy the code to those pages.
8. To track the conversions happening in all the pages(where you have copied the code), click the 'Webpages' tab under Conversions ( Reporting and Tools-> Conversions).
Now you will have the conversion data for each clicks from the Ad Campaign.

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