Pay-per-click (PPC) advertising is often explained as auction-based advertising. This is due to the fact that advertisers bid for the most lucrative ad positions. It would be reasonable to assume that the highest bidder is always the winner. But this is not true. PPC is not only about the bid.
For the record, PPC ads appear in a variety of places. You see them on your social media sites; they come up on your phone. Google Ads is by far the most prevalent PPC platform. When you consider that Google dominates the search engine space, it makes sense that their ads would also dominate the PPC industry.
How Ads Are Ranked
Platforms like Google have to rank ads the same way they rank websites. Otherwise, they will not know which ads to place where. This leads to a pretty basic question: how are ads ranked? Platforms do things differently, but Google relies on two parameters. The first is quality score and the second is bid.
There is a temptation to believe that the highest bid will always achieve the greatest rank. Yet Google assigns a quality score to every ad that customers purchase. That quality score is multiplied by the bid amount to determine an ad’s ranking. Simple math demonstrates that a quality score can ultimately be more important than bid amount.
Let us say you create an ad with a quality score of ten while one of your competitors creates and ad that only scores two. You bid $2 while your competitor bids $5. Your ad would be ranked higher because multiplying your quality score by your bid returns a total score of twenty. Your competitor’s total score is ten.
How Quality Scores Are Determined
The tricky part in all of this is getting a good quality score. It is part science and part intuition. There is also some creativity involved, at least where things like landing pages are concerned. Here are the three components that go into Google’s quality score:
- User Experience – Believe it or not, Google actually takes a look at the page an ad is linked to. Say that happens to be a landing page. Google looks to determine whether it offers a good user experience.
- Keyword Relevance – Google algorithms take note of relevance when analyzing ads and the content they point to. If relevance is high, that is good for an ad’s quality score. Conversely, a lack of relevance will hurt the quality score.
- Estimated CTR – Finally, Google estimates a click-through rate (CTR) based on an ad’s design. This is important in the sense that Google only gets paid when people click the ad.
It should be obvious that achieving a good quality score requires putting in some effort. At Webtek Digital Marketing in Salt Lake City, UT, they say that developing a good PPC campaign requires just as much effort as content marketing, on-site optimization, and even local SEO.
Bidding Competitively Still Matters
Do not misunderstand the intent of this post. Despite the importance of quality score, successful PPC still requires bidding competitively. Company’s hoping to achieve the best results have to be willing to pay for the most important keywords related to their particular products or services. But there is another way.
Good keyword research can return less competitive keywords that could still prove very valuable. Finding those keywords allows a company to go with a lower bid and still achieve exceptionally good results. But in the end, a bid alone is not what wins the day. It is the combination of competitive bidding and achieving a good quality score.