It’s amazing to think that when you type something into the Google search bar, within less than one second, Google presents you with relevant search results and ads. In terms of the Google text ads that are shown for your search there is a lot that goes on in the background to determine which ads appear.
Which ads appear and their position on the Google search results page is based on an auction. Bidders set a maximum amount they are willing to bid for keywords relevant to their ads – keyword bids. But it is not as simple as the highest bidder’s ad appears in first position i.e. at the top of the page. There are other factors that influence the auction outcome.
Firstly, when a Google search is entered, Google AdWords identifies all the ads that are eligible to be shown. This takes into account keywords, locations, times, languages and approval status. Google AdWords then analyses each of the eligible bidders to determine the ad ranks. Ad rank determines ad position on the search results page. Ad rank is determined by two things –
- Quality score
- Keyword bid
Quality score is determined by three things:
- Expected click through rate. Based on the history of an AdWords account, Google AdWords determines the likelihood that the ad would be clicked if shown for that search term.
- Landing page experience. Google AdWords considers what the user experience will be if the ad is clicked for that search term and the user is taken to the website. Highly relevant, original content and easily navigable websites are highly rated.
- Ad relevance. Google AdWords assess the language used in the ad as compared to the search term to ensure the ad is highly relevant. The likely impact of ad extensions is also considered.
Once the quality score for each eligible bidder is determined, it is combined with the keyword bid to determine the overall ad rank.
Ad rank determines ad position. If an ad rank is too low, no matter what the bid is, the ad won’t be shown. The cost of clicks on ads is calculated based on ad rank. A bidder only pays as much as the next highest bidder below them. This is why it is possible to reduce the amount a bidder will pay for clicks on their ads, by increasing their quality score through highly relevant ads, ad extensions and landing pages.
It’s hard to believe that this entire process goes on in less than one second to determine which ads appear with the search results when you enter a Google search. It’s a complex process and its objective is to ensure that ads are highly relevant to what a user is searching for. This ensures that Google remains useful to both users and advertisers.