Did you know that there is a Quality Score that is not visible in your Google Ads account? There is more going on here than what is immediately apparent. You can’t solve a Quality Score issue by only looking at the keyword level Quality Score in the Google Ads interface. Further investigation is needed to fully understand the problem at hand. This may require some effort on your part to uncover all the relevant information. This guide provides an overview of the different types of Google Quality Score, explains why Quality Score is important, and provides a checklist of action steps for improving Quality Score.
Types of Quality Score
Account-Level Quality Score
Account-level Quality Score is based on the historical performance of all keywords and ads in an account. Although Google does not come out and say it, Quality Score exists on different levels, and it is generally accepted by those in the know that there is more to Quality Score than the keyword level Quality Score that is visible to everyone.
Keyword-Level Quality Score
This is the Quality Score that Google assigns to your keywords. You can see it in the Google Ads interface. A keyword’s Quality Score is scored on a scale of 1 – 10 with 1 being poor and 10 being great. The score for your keyword is based on how well search queries that match your keyword perform. This means that your Quality Score will not be affected by changing your keyword match type.
Ad-Level Quality Score
Quality Score is determined in part by the click-through rate of the ads in each ad group. If you have a lot of ads in your ad group with low click-through rates, they could be contributing to a low Quality Score, since Google Ads considers all of your ads when calculating your scores. A method for improving your account’s Click-Through Rate is to include Dynamic Keyword Insertion ads for your Search Network campaigns. DKI advertisements will show the user’s exact search query, as long as it does not go over the limit for advertisement characters. You need to be cautious when using these types of ads, but it’s more likely that people will click on your DKI ad than a non-DKI ad because it seems more relevant to what the user is searching for. Although a high CTR is desirable, be cautious of ads that have poor conversion rates as they will lower your ROI. You can pause low-performing ads without hurting your Quality Score, but if you edit an existing ad, its history will be deleted.
Relevance is factored in when AdWords determines if your ads will show extensions. The first position in an ad isn’t always the most profitable, but it can be if you take advantage of features like site links. A competitive bid and good Quality Score are necessary to make the most of this position. Google is also testing placing the domain name in the first line of the ad, however, the ad must be in the top position to qualify.
Why Quality Score Matters
From Google’s perspective, Quality Score is important because it quantifies how well your ads match users’ search queries. The quality score is used by Google to make sure that the ads people are seeing are relevant to what they have searched for.
Advertisers consider Quality Score to be very important for various reasons. This metric measures whether a keyword is eligible to be auctioned off and, as a result, whether your ad will appear in response to a user’s query on the Google Search Network. Basically, Quality Score is a really important factor in how well your ad performs, especially if you don’t have a lot of money to spend. The ad rank formula for the Google Search Network is as follows:
Ad Rank = CPC bid × Quality Score
Even if advertisers have a small budget, they can still optimize their accounts to get a high Quality Score. This will result in a high ad rank, even if their bid is lower than a competitor’s bid. Quality Score affects where your ad appears on the Google Display Network. The ad rank formula for keyword-targeted ads is as follows:
Ad Rank = Display Network bid × Quality Score
Google will take into account your bid and your Quality Score when deciding where to place your ads on the GDN. The ad rank formula for placement-targeted ads on the Google Display Network is as follows:
Ad Rank = Bid × Quality Score
Ultimately, Quality Score affects your account health and success. If your Quality Score is too low, your keyword might not be able to be used in an auction, which means your ad will not be shown and you will not have a chance to compete for that customer. If your Quality Score is low, your ad rank will likely be low as well, which would mean that you would get less traffic to your site and a lower ROI.
Quality Score Misconceptions
Here are some of the myths people believe about Quality Score.
Myth #1: Changing Match Types Alters Quality Score
Although Google does not take keyword match type into account when determining Quality Score, match type is still an important factor in managing a successful PPC campaign. This means that if you are using the same keyword in different ways across your account, they will all have the same Quality Score. Google will determine a keyword’s QS based on how well that keyword matches a given query. The Quality Score for the keyword “pink slippers” will be the same whether it is an exact match or a broach match. Adjusting a keyword’s match type will not have a direct impact on that keyword’s Quality Score.
Myth #2: Quality Score Suffers when Ads or Keywords are Paused
If you pause your ads or keywords, your Quality Score will not be affected because it is based on how well your keywords and ads perform. If advertisers are not active on an ad platform and not creating ads or campaigns, then they will not be able to generate a Quality Score.
Myth #3: Display and Search Quality Score Affect Each Other
Quality Scores are not affected by each other. First, the criteria for determining these Quality Scores are different. Although the search and display networks are both run by Google, they are completely different and would be almost impossible to affect each other. One performance will not affect the other.
Quality Score Directly Impacts CPC
Many companies haven’t realized how ads are priced in AdWords, which is a cost per click advertising system. The math has gotten more complex since a black box element was introduced. To understand how QS affects prices, it is helpful to look at how it used to work when the math was simpler, as well as how Google makes money.
1. How Ads Used to be Priced
AdWords used to be a system where you were charged based on the number of impressions. Whichever advertiser was willing to pay the highest amount per click would have their ads appear above the organic search results. AdWords then introduced a CPC system which they called AdWords Select. The CPC ads started to generate higher CPMs than the ads placed through the legacy AdWords system. Google rebranded AdWords CPM as just “AdWords” after sunsetting it.
This means that if you want to increase your ad rank, you can do so by either increasing your maximum bid, increasing your CTR, or a combination of both. If your click-through-rate doubled, you would only have to pay half the cost-per-click to maintain the same ad rank. In a surprising twist, if two advertisers are bidding the same amount, the one with the better click-through rate would get the top spot and pay a lower cost-per-click than the other one!
AdWords was successful for smaller companies because it was relevant. Smaller companies might not have the same advertising budget as their larger competitors, but they can still compete based on how relevant their product is.
Ad rank is now an unknown function of three factors, making it more of a black box. However, by the end of this article, it should be much clearer. We cannot say that doubling your quality score will automatically double your ad rank. CTR is also no longer a factor. Google makes money by selling advertisements.
2. How Google Makes Money From Ads
Google generates income when advertisements are clicked on and advertisers pay the CPC linked with the click. The analysts are too focused on the CPCs that Google is collecting and are not seeing the bigger picture. Google has always cared about CPM, not CPCs. Originally, ads were priced based on how often they were displayed (CPM), but when the CPC system was introduced, ads were also ranked based on how much publishers were paid per click (CPC).
Google’s recent decision was a wise one as it allowed them more autonomy. If ads were ranked on a CPC basis, Google would be vulnerable to a lot of external factors that could impact their revenue. Advertisers’ spending habits and users’ clicking behavior both affect how much revenue a website makes.
If Google sells ads on a CPM basis and can hold that price steady, they can increase their revenue by increasing the number of searches people do. The only thing a company can do to increase its success is to make a good product and get people to use it. Google sees 100 billion search queries every month.
Even though Google’s ranking system has become more refined, the company still generates revenue in the same way it always has–by selling advertising space to the bidder willing to pay the most per 1000 impressions. You can always calculate CPM by using CTR and CPC. How does the new ranking formula compare to the old, much simpler one?
The Impact of Ad Extensions On Quality Score
Now Google also factors ad extensions into ad rank. Google takes ad extensions into account when ranking ads because they can significantly impact the click-through rate. Google will take into consideration the ad with site links that boosts the CTR by 17% when calculating the CPM used to rank ads. If an advertiser’s ad extension doubles the CTR, then the advertiser only needs half the CPC to maintain the ad rank.
Although an improved CTR may lead to a higher CPC, it does not guarantee it. However, the ranking factor that isn’t called the click-through rate is actually all about the click-through rate.
How to Get a Better Quality Score
And how do we get a better QS? We can make our ads more relevant to our keywords by structuring our ad groups in a way that supports higher relevance. You can divide an ad group with more than 30 keywords into smaller ad groups with more specific ad texts. This means that you should always be testing new ads to see which ones perform better in terms of click-through rate.
In simple terms, AdWords ad Rank is a measure of the quality of your ad and how relevant it is to the person seeing it, and Quality Score is a measure of the quality of your ad and how relevant it is to the person seeing it. If you focus on increasing your Quality Score, your CTR will follow.
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