Quality score can drive the success or failure of your paid search keywords, and the two best known impacts of quality score are the effect it has on text ad position and cost-per-click:
- Ad position is determined by Ad Rank which is calculated as bid x quality score.
- CPC is calculated by dividing the Ad Rank of the next highest advertiser by your quality score (and rounding up to the nearest $.01).
But before fighting for position or even worrying about CPC, each keyword must earn eligibility into the real-time auction that takes place when someone enters a search query that Google deems potentially relevant to your keyword.
There are some interesting dynamics in that part of the process that are worth understanding if you really want to optimize your AdWords account and maximize your results.
In part 1 of this series, we looked at how quality score helps you to focus on resolvable issues in your account, and warn you about keywords where success may be difficult. In this installment we’ll learn more about how quality score effects auction eligibility.
This series is based on material from the new book Quality Score in High Resolution and is a preview of the Quality Score session at the upcoming SMX Advanced in Seattle.
A lot happens behind the scenes when someone clicks the ‘Search’ button on Google.
In a split-second, AdWords has to decide which keywords from which advertisers should compete for the available PPC slots on the search results page.
Given the massive number of advertisers, volume of keywords, effect of match type, and complexity of the search queries they see, the fact that they can figure it out at all is impressive and that they do it within the milliseconds before the results appear is truly mind-boggling.
Think of keywords as being magnetic. Exact match keywords are specialized magnets that only attract very specific search queries. Phrase and broad match keywords have larger levels of magnetism and therefore attract a wider range of search queries.
The phrase match keyword ‘cheap dog food,’ for example, should be strong enough to attract any search query that includes at least those three words, unless:
- The query is excluded due to a negative keyword
- The search originates in a geography that is outside the defined targets
- The keyword bid is below the minimum required bid
- Some other setting or aspect of performance history blocks the keyword from being eligible
Increasing the bid or quality score for any keyword strengthen its magnetism, extending the range and increasing the quantity of search queries it can attract. If each keyword is surrounded by a moon-like orbit of search queries, as the magnetism gets stronger the keyword is able to reach out to more and more queries.
This is best understood by example:
- For the phrase match keyword ‘cheap dog food’ you have a $1 bid and a quality score of 6.
- Average impressions = 1000/day, average position = 4, average CPC = $0.65
- They keyword is eligible for some potential auctions, but misses eligibility for others.
- Quality score goes up to 7.
- For search queries where ads where already showing, you earn better positions and enjoy lower CPCs.
- This new higher quality score makes the keyword eligible for auctions involving search queries where it was previously ineligible. This happens because each search query has a minimum required bid for any keyword and that minimum is based on your quality score. With a quality score of 6 the minimum bid for a particular search query might have been $1.10 – so the keyword was ruled ineligible. But now that it has a quality score of 7 the minimum bid for the query is only $1.00 so the keyword is entered into the auction.
- This happens for any number of these ‘far away’ search queries, so after entering the auctions it wins positions and ads are shown for some of them. Your total impression volume will rise.
- Since your keyword is just creeping over the bid requirement to become eligible for these auctions, it’s likely that many other advertisers have far higher Ad Ranks for those search queries (each competitor is entering different keywords with different settings, bids, and CTR histories into these auctions) so in many cases you’ll earn relatively low positions on the results pages.
- Lower positioned ads tend to get lower click-through rates.
- And because it’s likely that your ad rank is lower than more competitors, and your quality score for this query (link) might be a bit lower too, you’ll tend to pay higher CPCs on these newly conquered search queries than the existing keyword average.
- The impact of these new search queries for which you gained eligibility by increasing your quality score is a rise in the average position, a decrease in CTR, and a bump up in the average CPC reported for this keyword.
- Including both existing and new search queries where the keyword is now displaying ads, average impressions rise = 1400/day, average position = 5, and average CPC = $0.88
So you earned a better quality score – which was a goal – and in some cases will be rewarded with more traffic but worse performance metrics.
It’s unlikely they would be dramatically worse, but seeing the theory play out in this example helps add dimension to the idea that search queries are more important than keywords and at least for those keywords consuming the largest shares of your budget, or having the highest CPCs, you need to actively monitor the search query reports to manage down to that level.
These results may be unexpected, but it’s impossible to categorically state that they’re undesirable or negative. They’re just a strange byproduct of the math – position and CTR are averages and when you enlarge the circle of search queries those at the outer edges lower these averages while increasing the total search volume.
You can only decide if the overall effect is positive or negative by looking at your average ROI and unit volume as compared to your goals.
It is surprising to most people that better quality scores produce these two simultaneous effects:
- Performance improves for search queries that were already matching
- Key metrics will be lower-than-average for many of the newly eligible search queries.
There is no way to get the benefits higher quality scores provide on search queries you’re already winning without at least potentially experiencing the degradation brought about by newly eligible search queries.
All you can do is keep a close eye on your search query reports and when you see new search queries that may be some of the new ‘remote’ queries for which you’ve recently become eligible, either create negative keywords to avoid them or add them as new keywords so you’ll be able to see their quality scores, bid them independently, and track their performance in order to control them more precisely.
It’s important to reiterate that not every new search query you gain eligibility for when quality score increases will bring lower-than-average positions or higher-than-average CTRs. Each query is subject to its own competitive marketplace, CTR history and expectations, and other factors. New queries may be at, above, or below these averages.
For the advanced search manager, or anyone spending huge sums of money on AdWords, this detailed look at one small aspect of ‘how it really works’ clarifies yet again the limitations we face based on a reporting system built around averages.
If we could see the impression counts, quality scores, CTRs, average positions, and CPCs for every search query our keyword interact with, we’d be in a far better position to manage our budgets responsibly and far more profitably.
In the next post in this series, I’ll dig deeper into that theme, and explore more of the ways that a lack of transparency, specifically related to quality score, makes it difficult or impossible to control our own fates and budgets in AdWords.
Opinions expressed in the article are those of the guest author and not necessarily Search Engine Land.