Google Quality Score Determines the Cost per Click (CPC)

We think that the highest bidder will always rank higher than the lower bidder due to the nature of the traditional auction. However, it doesn’t work that way with Google Adwords. So here are the main takeaways of these three key points determining ad positions and CPC (cost per click) for Adwords.

Please note that Google changes these ranking factors, but I still think this is great because it is pretty basic. And these points could easily apply to common best practices to build a quality ad.

What determines the Quality Score

1) Quality score is determined by Relevancy, Landing Page, and Click-through Rate (CTR).

2) Relevancy is determined by the language used in the ad. And its language against the keywords used in the search query.

3) The landing page should have relevant, original content, quick load time, minimal pop-ups or pop-under, and transparency of site interaction between the server and users.

4) Consider the site’s service, value, and performance on the mobile device. Again, Google is very likely to weigh in heavy on how you deliver a good user experience through mobile.

What determines Ad Ranking

1) Ad ranking is determined by Bid Price (BP) and Quality Score (QS): Ad Rank = BP x QS

2) The ad with the highest Ad Rank gets the top position. Although that won’t guarantee you the 1st position in SERP (search engine result page). I have tested this, but your quality plays a significant role in suppressing your ad position regardless of spending.

What advertisers pay

1) Paid price is the bid amount set by the advertiser below them.

2) Advertisers do not necessarily pay the max bid price.

3) The high-quality score will yield a lower price or CPC.

4) Advertisers have to pay:P1 = Price that Advertiser-1 payQ1 = Quality of Advertiser-1 adB2 = Bids of Advertiser-2Q2 = Quality of Advertiser-2 ad

Note: Ad Rank = (B2)(Q2) = Bid Price x Quality Score(P1)(Q1) = (B2)(Q2)P1 = [(B2)(Q2)] / (Q1) = CPC

Here is the video. Check it out!

source: https://adwords.googleblog.com/2009/03/introduction-to-ad-auction.html

Thank you so much for taking the time to read my content.  If you've liked what I've had to say please subscribe!