Google AdWords works like an auction.
Advertisers bid on target keywords that are relevant to their products or services. Bidding starts when a user conducts a search. The AdWords system then finds all ads that match those keywords and competing advertisers are pitted against each other. In a normal auction, the highest bid would win but ad positions aren’t just solely based on who bids the most. Other factors such as ad relevance and quality are also considered.
If your ads aren’t performing well, a large part could be due to your Quality Score. Understanding and improving your scores is key to driving more conversions with AdWords.
Quality Score is a rating—reported on a 1 to 10 scale—based on the quality and relevance of your keywords and ads. The Quality Score formula consists of the following:
Your Google AdWords Quality Score matters for two reasons: Better ad positions and lower prices. Even if a competitor makes a higher bid, it’s possible to achieve a better ad position at a lower cost. Improving the relevance of your campaigns means lowering your overall customer cost acquisition.
Quality Scores are crucial but they’re only part of the equation.
Ad Rank is the metric that combines both your Quality Score and maximum CPC to determine where your ads are eligible to appear in the paid search results. Here’s an example of how this looks:
If there are multiple advertisers bidding for the same keywords, the ad with the higher ad rank wins the top position. Ad extensions are another factor that affect ad rank. If two competing ads have the same scores, the ad that drives a more positive impact with an ad extensions would appear higher.
The ad rank of your competitors also determines how much you pay. Your CPC is calculated by the ad rank of the next advertiser below you and dividing by your Quality Score. Here’s an example:
The key takeaway is that ad rank determines where your ads are positioned and your CPC.
To check your Quality Score, login to your AdWords account and click the Campaigns link at the top. Next, click on the Keywords tab and hover over the white bubble icon in the Status column:
Quality Score is a measure of how relevant Google deems your campaigns. The higher your score, the better your ad positions and the less you pay overall for each click.
Here are ways to improve your Google Quality Score:
A low AdWords Quality Score typically stems from poorly optimised campaigns between keywords, ad groups, and landing pages. Improving the relevance of each is key to driving better results with your PPC marketing efforts.
Paid Traffic offers AdWords management services that deliver more sales to your business. We manage all aspects of your campaign from the initial setup to ongoing optimisation and more.
Contact us today to schedule a marketing consultation with our PPC experts.