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How Google’s Ad Rank Works

Google Ads is an online platform where advertisers pay to display brief overviews of their businesses, services, and products. There’s no doubt that Google, being the premier search engine of the world, receives a large amount of offers from a multitude of advertisers worldwide. So how exactly does Google’s Ads auction work?

To shed some light on this mystery, let’s first start out by explaining some of the fundamental concepts/vocab involved in determining the ranking of the ads.

Each advertiser has a designated value called Ad Rank that determines the position of its ad in relativity to the other ads (for example: second link on a page). Ad Rank is determined by several factors:

  • each advertiser’s bid (how much each advertiser is willing to pay for an advertising slot)
  • ad quality (Google’s rating of the quality and relevance of your keywords in the ad group as well as the quality of your landing page)
  • Ad Rank threshold (minimum bid necessary for your ad to be displayed in a specific position)
  • the context of the search (the keyword a user typed in to search for your ads, time of search, location, device, etc. )
  • the impact of ad extensions (additional pieces of information about your ads that make it more useful and accessible to users)

Although it might seem pretty self explanatory that the advertiser with the highest bid is more likely to get the highest slot, that’s not always the case. Because Ad Rank takes into account several different factors, an individual advertiser’s bid does not have the sole power to dictate the position of its ad. Rather, content relevance, prominence of ad extensions, clickthrough rates are more heavily weighted when it comes to evaluating the impact of ads. Hence, even if your competitor submits a higher bid than you, you can still obtain a higher position if you use highly relevant keywords in your ads.

Another interesting discovery I stumbled upon is that your ad rank is recalculated and thus fluctuates each time your ad is eligible to participate in an auction. This in turn guarantees that no advertiser’s ad will appear consistently on the top of the page, which produces a fair market that’s less prone to monopoly.

 

Some of the possible ways that an advertiser can increase his/her Ad Rank is through:

  • split your keywords into tight, organized groups that are more closely tied to individual ad campaigns to increase visibility of your ads
  • refine the ad text by narrowing down the scope of your target audience and testing out keywords that are more directly targeted towards your desired individuals and market segments
  • exclude irrelevant, unnecessary search terms to reduce costs
  • include callout extensions (additional descriptive text in your standard ad that highlights special features of your products/services and differentiate you from your competitors, example: “Free Shipping, Next Day Delivery”)
  • include sitelink extensions (additional links in your advertisement that will take the user directly to a specific page on your website, this is especially helpful if you are running a seasonal campaign and want users to access a specific section of your site)

Sources:

https://www.wordstream.com/quality-score

https://support.google.com/google-ads/answer/7634668

https://www.wordstream.com/blog/ws/2013/10/24/adwords-ad-rank-algorithm

5 Ways Google Ad Extensions Can Improve Your AdWords Campaign

 

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