Save Money on Google Adwords by Understanding Ad Rank Formula

In a blog post without any fanfare Google changed how adverts rank in Google Adwords. I have seen lots of business move over and take advantage of higher rankings at lower prices. However there are still many who are not enjoying the opportunity of lower cost and higher click through rates.

Google’s Ad rank has been in place for a number of years and is shown beside each keyword you are bidding on to trigger your advert.

Google uses a formula to rank adverts in the Adwords auction. You have always been able to influence the rank by increasing the bid amount, by having a high quality landing page, and a high quality advert.

Changing titles, headers, description and sometimes adding text to the page can lower your click amount.

The change to the ranking algorithm last year again allows you to control more elements of your advert and hopefully lower the cost again by including extensions and formats.

Ad extensions are a type of Ad Format and they show extra information about your business - hence the name extension. Some of the extensions can be added manually and some are automatic - the aim is to make your advert help users more, stand out better, provide better click rates- in that order.

There is no additional cost to extensions, however you will be charged for clicks on some interactions on the extension. For example clicks on a call button, a download button, (for app extensions), and map directions all cost the normal click cost. The free clicks are seller ratings, reviews, and social annotations.

Part of the automated system is highlighting the first description line where it can sometimes be added to the headline. It will only generally use this line if it is a complete phrase, run on lines are ignored. This results in a more prominent headline and hopefully higher click through rates and therefore lower costs.

Since Oct 2013 Ad rank will now be slightly more complicated. The bid amount is still included, quality is still important - onsite and the advert. However it is now important to enable these extensions.

Without extensions formatted correctly Google will estimate your advert as being less likely to help consumers and therefore lower your ranking in the auction. This results in the same cost per click for your business with lower ranking and less clicks.

Google have stated that ad extension will likely not be shown for adverts that have a low quality score. If your quality score is already low enabling extensions will likely not help and Google recommend you increase the advert and landing page score.