Quality Score is Job 1

August 22, 2008

Google has just announced substantial changes to how quality score is calculated and applied. These changes will impact most paid search marketers, and part of your plans over the coming weeks should be to understand the changes, how they will impact you, and decide on a course of action. In particular, marketers should consider how this will impact their bid strategy as it applies to poor performing keywords.

To begin, here’s a quick recap of how Quality Score works today. Google has been using QS for the past three years in the rankings of paid search ads. Quality Scores is determined by comparing the keyword, the ad, and the landing page, as well as Click Through Rate, and page load time. If the bids of two ads are the same, the ad with the higher QS will have a higher position. Currently, the QS of a keyword determines its minimum bid, where the minimum bid is the minimum CPC needed to have the ad display at all. And ads with really low quality scores may not appear at all, even with a very high bid. As a bid management strategy, poor performing keywords could be bid down below their minimum bid, and they would stop displaying and generating cost. As we will see, this strategy will need to be modified.

Google has announced three changes:

  1. More Accurate Quality Scores: they are replacing static per-keyword Quality Scores with a system that will evaluate an ad’s quality each time it matches a search query. Though this is most likely a good thing in general, the risk is that it could be harder to determine what is good and what needs to be changed. For example, a keyword may get a lower quality score because of the broader matches it’s receiving, rather than the inherent quality score of the term.
  2. Eliminating Inactive Status: now, even a very low keyword bid with a low quality score may still be served up in search results.
  3. “First Page Bid”: the new “First Page Bid” field will replace the Minimum Bid. In the Google interface, each keyword will now display an estimated bid needed to get that keyword on the first page of search results. Since virtually all clicks and impressions come from the first page, this will be a useful feature to quickly see how close an ad is to being seen.

So, with these changes, all active keywords could be served in search results. This could be a problem for poor performing keywords.  If you used a strategy of bidding poor performers below their minimum bid, you’ll need to revisit these keywords and make sure they don’t start accruing cost. They will continue to be served, particularly if there is little or no competition, even if they are bid down quite low. A few clicks at $0.05 may not break the bank, but if you have thousands of tail terms that perform poorly, the costs could add up quickly.

You might say that these keywords could simply be deleted, but there are reasons to keep these keywords active. Many keywords are seasonal, so it’s useful to keep them active until the next season. Deleting the keyword means losing the performance data associated with it, the QS history, and the keyword would have to be re-created later. Pausing and un-pausing keywords based on performance is time-consuming; it’s simpler and more straightforward to optimise the bids to the each keyword’s performance.

For our clients, we will be looking at poor performing keywords and making adjustments as Google rolls this feature out. We are also looking at enhancements to SearchAdvisor’s Automated Bid Manager, to take advantage of the new First Page Bid feature, and to automate bidding of both strong and poor performing keywords.

One possible strategy here would be to utilise the new First Page Bid metric as a way to ensure that “must have” keywords continue to get visibility. Combined with some pain threshold (i.e. keep me on page one but only if the economics hit this criteria) this could be a real nice way to ensure that the right keywords continue to have high visibility. Think of it as a dynamic bid floor that keeps important words in play but at a controllable cost.

If you don’t use SearchAdvisor, I recommend monitoring your bids carefully, especially for poor performing terms, to insure that you don’t continue to spend good money after bad. Look for keywords at low positions but that are still incurring cost. If necessary, pause or kill poor performers. Google says that the QS and bid must surpass a threshold for the keyword to enter an ad auction, so it may be that your costs don’t change much. In the end, this change to Quality Score rankings and the elimination of the Minimum Bid should be good for retailers; just monitor your results and make adjustments to your bid strategies.

written by Jason James (jason.james at channeladvisor dot com)