There are three ways Google calculates Ad Rank and Quality Score factors into each of them:
- Ad Rank for keyword-targeted ads on the search network
- Ad Rank for keyword-targeted ads on the content network
- Ad Rank for placement-targeted ads on the content network
These three formulas were pulled from Google word for word and will explain how they calculate the above three scenarios.
Ad Rank for keyword-targeted ads on the search network
With a keyword-targeted ad, a keyword’s rank on a search result page is based on the following formula:
Ad Rank = CPC bid × Quality Score
According to Google, the Quality Score in the above formula for search network is determined by:
- The historical clickthrough rate (CTR) of the ad and of the matched keyword on Google; CTR on the Google Network is not considered
- The relevance of the keyword and ad to the search query
- Your account history, which is measured by the CTR of all the ads and keywords in your account
- Other relevance factors
- Your landing page quality is not a factor.
Ad Rank for keyword-targeted ads on the content network
A keyword-targeted ad’s position on a content page is based on the ad group’s content bid and Quality Score. If you don’t set a content bid, we’ll set an automatic bid using an average of all your ad group’s keyword- and ad group-level CPCs.
Ad Rank = content bid X Quality Score
The Quality Score related to Ad Rank on the content network is determined by:
- The ad’s past performance on the site in question, as well as on similar sites
- Your landing page quality
- Other relevance factors
Ad Rank for placement-targeted ads on the content network
If a placement-targeted ad wins a position on a content page, it uses up all the available ad space so no other ads can show on that page. (Certain content pages may have more than one block of space reserved for AdWords ads. In those cases, a single placement-targeted ad or multiple keyword-targeted ads can occupy each block.)
To determine if your placement-targeted ad will show, our system considers the bid you have made for that ad group or for the individual placement, along with the ad group’s Quality Score.
Ad Rank = Bid × Quality Score
The Quality Score related to Ad Rank for placement-targeted ads with CPM bidding is derived solely from landing page quality. For placement-targeted ads with CPC bidding, the clickthrough rate is also considered, just as it is with keyword-targeted ads.
Learn how placement-targeted ads and keyword-targeted ads compete for positioning on a content page.
“How-to” improve your Ad Rank?
There is no silver bullet to improving your Quality Score. We recommend doing any or all of the following:
- Define your advertising goals- how you define your campaigns depends on your strategy. Figure out whether you are going after ROI, CTR, and or traffic and then develop keywords and placement to achieve these goals.
- Critique account structure for maximum effectiveness- set your account up for relevancy and ease of management. This means organizing your Campaigns and Adgroups based on product lines, resources, or brands.
- Choose relevant keywords and placements- keyword selection is the most important piece to running an effective campaign. Make sure you take advantage of matching options and keyword negatives to improve click quality.
- Create straightforward, targeted ads- you should create simple, enticing ads with strong call to action and test impact on placement and performance.
- optimise your website for conversions- use correct or most relevant landing page, test site content, improve user experience, etc.
- Track your account performance- review data on a regular basis to make sure you’re targeting relevant, converting traffic based on your advertising goals from #1 above.
- Test and modify your campaigns to get the results you want- take action on your findings from #6 above. Paid search management is an iterative process that demands continual actions.
At ChannelAdvisor, we suggest looking at keyword assists to determine if you are evaluating all possible conversion opportunities before bidding keywords down. There are situations where keywords may not appear to be performing because they are toward the beginning of the buying cycle. These keywords usually get low revenue attributed to them and eventually get bid down for under performance. But if bid down, your traffic and overall conversions will suffer. Look for keyword assists data to provide actionable insight to improve your campaigns. Look for more to follow regarding this topic.
written by Greg Ives– greg.ives at channeladvisor.com