How Does Google AdWords Work? | What Happens When You Enter A Query Into Google?
Google looks up the keywords AdWords advertisers bid on
- Keywords with a Quality Score below 4 aren't eligible for auctions and don't receive impressions at all: 1) Keywords: Search query (CPC - 2, Quality Score - 10); Keywords: Just a search query (CPC - 1.5, Quality Score - 7);
2) Keywords: Another search query (CPC - 2, Quality Score - 9); Keywords: Just a search query (CPC - 1.5, Quality Score - 7); 3) Keywords: A search query (CPC - 3, Quality Score - 8); Keywords: Any search query (CPC -
2, Quality Score - 6).
How does the auction system actually work?
- The actual CPC paid for a click differs from the max. CPC. Basically it's calculated by the AdRank from the advertiser in the lower position divided by the quality score (Actual CPC = Competitors AdRank/Your Quality Score): 1) Joe
pays 2.5 for a click. To calculate this Google takes Billy's AdRank of 20 and divides that by Joe's Quality score of 8, 20/8 equals 2.51; 2) It's not quite clear how the minimum price is calculated, we're quite sure that Quality Scores,
historical CTR of the keyword/display URL and max CPC play a rate in the calculation.
- There is a difference between you max CPC and your actual CPC!
- It's not quite clear how the minimum price is calculated. We're sure that Quality Score, historical CTR of the keyword/display URL and max CPC play a role in the calculation.
- Let's say Joe raises the quality Score from 8 to 10. So he still stays on position #1 but pays 20% less for the click!: Billy's AdRank/ Quality Score (20/10) = Actual CPC (2). That's 20% less costs!
- Why does that matter or why should I care?: Understanding how the auction works can save a lot of money! Raising your Quality Score lowers not only your costs but also improves ad positions!
So finally the Google Search Results page (SERP) will look like this:
- Sometimes the SERPS look a bit different: These are the Ad Extensions!: 1) "Sitelinks Extensions". These sitelinks can be found on the "Ad Extensions" tab and are the so called "Sitelinks Extensions"; 2) This is the seller rating
extension: The seller rating rating extension is added automatically! In order to qualify the URL must have at least 30 unique reviews with 4 or more stars on Google Product Search.
- Sometimes ads are shown on top of organic search results. To qualify ads "have to meet certain standards". These positions can't be bought but have to be earned.
- This is the location extension: The location extension is useful for local businesses, they can be created using an existing Google Places Account on with manually entered addresses. Multiple addresses can be used as well.
- This is the product extension: The product extension allows to highlight an existing Google Merchant Feed directly in the Google Search ads. The shown products are automatically selected by Google and can't be directly influenced.
In order to see this extension the Google Merchant Account has to be connected with the Google Adwords account.
The top 3 tactics for optimizing a Google Adwords account!
- #1 Create highly targeted ad groups: 1) There should always be at least 2 ad variations per ad group! (Always be testing!); 2) Keep the maximum number of keywords per ad group somewhere around 5!; 3) The keywords should
define a semantic group around a seed-keyword. ("red shoes" in this case)
- #2 A/B testing copy: 1) Blue shoes on sale (thumb up): Impressions: 2000; Clicks : 1000; Conversions: 15; CTR: 5%; CVR: 15%; 2) Blue shoes on sale (thumb up): Impressions: 1500; Clicks : 100; Conversions: 8; CTR: 6.6%; CVR:
8%; 3) Always consider confidence! Experiments should be solely based on data, not your feeling (which only indicates hunger!)
- #3 Clever bidding strategies: 3 easy rules. These are 3 simple rules that help when starting up a fresh account!: 1) Pause keywords when: Time period - 30 days; Number of impressions - >200; Click-through-rate - <1%; 2) Pause text
ads when: Time period - 30 days; Number of impressions - >200; Click-through-rate - <1%; 3) Raise max CPC to first page bid estimate: Time period - 30 days; Number of impressions - >1.8; Click-through-rate - <4%. These 3 rules
are great for raising quality factor throughout the account!
Brought to you by: Pulp[media.at | Google Adwords advertising service is a trademark of Google Inc | Concept by: Ulf Weihbold; Twitter (@Ulef) | Graphics by: Patrick Schmid; Twitter (@Patrick_Schmid) | Sources: Pulpmedia
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