As a search engine
marketing professional, from novice advertisers to professional Internet
marketers, everyone want their ads to be placed at the top position before the
organic results in order to grab the attention from visitors and their
customers. There might be chances of getting best Return on Investment (ROI),
when your ads are placed at the right position with good adtext.
Do you know how the ads are positioned on content and search networks? Yes of course it is based on their Ad Rank. The highest Ad Rank of Ads will appear in the first position, and so on down the page.
Ad rank is nothing but the position of keyword targeted ads in search and content pages. Here we are going to see how Google determines Ad Rank as well as each advertiser’s actual cost per click.
Do you know how the ads are positioned on content and search networks? Yes of course it is based on their Ad Rank. The highest Ad Rank of Ads will appear in the first position, and so on down the page.
Ad rank is nothing but the position of keyword targeted ads in search and content pages. Here we are going to see how Google determines Ad Rank as well as each advertiser’s actual cost per click.
AdRank:
AdRank
= Max. CPC x Quality Score
AdRank
is measured by multiplying the maximum cost per click bid that the advertiser
is willing to pay by the Quality Score of that advertisers keyword. Ad position
is then calculated by the advertiser’s AdRank. According to that advertisers ad
will be positioned on highest or lowest position in Google search and content
networks.
Advertiser
|
Max
CPC
|
Quality
Score
|
Ad
rank
|
Position
|
Advertiser
A
|
$0.40
|
6
|
$0.40
x 6 = 2.4
|
1
|
Advertiser
B
|
$0.35
|
5
|
$0.35
x 5 = 1.8
|
2
|
Advertiser
C
|
$0.80
|
2
|
$0.80
x 2 = 1.6
|
3
|
Advertiser
D
|
$1.00
|
1
|
$1.00
x 1= 1
|
4
|
Advertiser
E
|
$0.05
|
5
|
$0.05
x 5 = .3
|
5
|
Advertiser
F
|
$0.10
|
2
|
$0.10
x 3 = .2
|
6
|
From
the above example you can find that, in spite of Advertiser D is bidding well
while comparing all of his competitors his ads will show in the 4th position
due to his low Quality Score.
Determining Actual CPC:
Actual
CPC = (AdRank to hit /Quality Score of Advertiser) + $.01
An
advertiser’s actual CPC is measured by dividing the AdRank to hit (the AdRank
of the competitor below them) by their own Quality Score plus $.01. The least
positioned ad will be the minimum price recommended by Google to display on the
Adwords page.
Advertiser
|
Max
CPC
|
Quality
Score
|
Ad
rank
|
Position
|
Actual
CPC
|
Advertiser
A
|
$0.40
|
6
|
$0.40
x 6 = 2.4
|
1
|
(1.8/6)
+ $.01 = $0.31
|
Advertiser
B
|
$0.35
|
5
|
$0.35
x 5 = 1.8
|
2
|
(1.6/5)
+ $.01 = $0.33
|
Advertiser
C
|
$0.80
|
2
|
$0.80
x 2 = 1.6
|
3
|
(1/2)
+ $.01 = $0.51
|
Advertiser
D
|
$1.00
|
1
|
$1.00
x 1= 1
|
4
|
(0.3/1)
+ $.01 = $0.31
|
Advertiser
E
|
$0.05
|
5
|
$0.05
x 5 = .3
|
5
|
(0.2/5)
+ $.01 = $0.05
|
Advertiser
F
|
$0.10
|
2
|
$0.10
x 3 = .2
|
6
|
Minimum
Bid
|
From
the above example you can find that, since the quality score of Advertiser C is
very low, he needs to pay more amounts to beat Advertiser E.
The quality score speaks
a lot in this. From the below example you can find the value of quality score.
By increasing the quality score, the ad rank will also automatically increase
to hit the top positions. In the below table, Advertiser B has increased their
Quality score and check how his rank get increased to hit the top position.
Advertiser
|
Max
CPC
|
Quality
Score
|
Ad
rank
|
Position
|
Actual
CPC
|
Advertiser
A
|
$0.40
|
6
|
$0.40
x 6 = 2.4
|
2
|
(3.2/6)
+ $.01 = $0.54
|
Advertiser
B
|
$0.35
|
9
|
$0.35
x 9 = 3.2
|
1
|
(1.6/9)
+ $.01 = $0.19
|
Advertiser
C
|
$0.80
|
2
|
$0.80
x 2 = 1.6
|
3
|
(1/2)
+ $.01 = $0.51
|
Advertiser
D
|
$1.00
|
1
|
$1.00
x 1= 1
|
4
|
(0.3/1)
+ $.01 = $0.31
|
Advertiser
E
|
$0.05
|
5
|
$0.05
x 5 = .3
|
5
|
(0.2/5)
+ $.01 = $0.05
|
Advertiser
F
|
$0.10
|
2
|
$0.10
x 3 = .2
|
6
|
Minimum
Bid
|
Quality
Score is the good way to reach the desired top positions and reduce your costs.
To become a Adwords star and to have a success with Adwords, you must improve
your CTR, the relevance of your Ads, quality of your landing pages and the
speed of the landing pages.