6 Components of Google Ad Rank and How to Improve it without Raising Bids

Being a pay-per-click advertiser sometimes feels like your hands are tied. You can only do so much to improve the efficiency and the quality of your Google Ads account. Google’s suggestion would probably be simple: raise your bids, and add more bucks. But if we look outside of raising bids and budgets, there are other ways to optimize your Google Ads accounts.

One way is to improve your Google Ad Rank, a value that determines where your ad shows up on the search engine results page (SERP). Ad Rank is recalculated every time someone searches for something, so your ad’s Ad Rank will vary from search to search. This variable number could be the difference between your ad showing in the absolute top position of the page and not showing on the first page at all.

Google Ad Rank is made up of six elements.

As shown above, Ad Rank is made up of six components: bid amount, ad quality, ad rank thresholds, the competitiveness of the auction, the context of the person’s search, and the expected impact of the extensions and other ad formats. Let’s take a closer look at what you can affect in the Ad Rank algorithm to drive significant improvement in your campaign performance.

But first, let’s weed out the three components of Google Ad Rank that are outside of our control or require spending more money. 

Bid Amount

Obviously, bid amount is one of those components. Although bid amount is one of the biggest factors in determining Ad Rank, in this scenario, we don’t want to spend any more money, so there’s really nothing else to discuss.

The Competitiveness of the Auction

Another component outside the scope of the advertiser’s control is the competitiveness of the auction. Some industries are just more competitive than others in terms of both volume of advertisers competing in a given auction and the cost per click. There’s nothing really you can do about it aside from switching industries, which obviously isn’t a realistic option.

The Context of the Person’s Search

And finally, the last of the three google ad rank components that is out of the advertisers control – the context of the person’s search. This means things like: the searcher’s location, what device they are searching on, the time of the search, etc. All of which you could, and should, be making bid adjustments for based on past performance. But considering them within the context of not spending more money there’s not much an advertiser can do to improve Ad Rank.

With those three out of the way, we can get into the meat and potatoes – the remaining three things we CAN control.

Ad Rank’s ad quality is made up of three parts: expected CTR, ad relevance, and landing page experience.

1. Ad Quality

One of the main things we have control over is Ad Quality. The quality of an ad – its Quality Score – is made up of three parts:

  • Expected Clickthrough Rate (CTR) measures the likelihood that a searcher will click on your ad when it’s shown for a specific keyword. It’s measured as “above average,” “average,” or “below average.” If your ads are showing as “below average,” try changing your ad copy, so it’s more relevant to your keywords.
  • Ad Relevance measures how closely related your keywords are to your ads. It is also measured as “above average,” “average,” or “below average.” Ad relevance is similar to expected CTR in that they both deal with how your ad copy relates to your keywords. However, having a “below average” ad relevance score means that either your keywords are too broad or that your ad groups have too many broadly-related keywords. It’s better to have a lot of ad groups with a few specific, related keywords versus a few broad ad groups with lots of semi-related keywords.
  • Landing Page Experience measures how relevant and useful your website’s landing page will be for a searcher that clicks on your ad for that specific search query. An ad’s landing page experience is also measured as “above average,” “average,” or “below average.” Pages score higher by being organized well and also by having text on the page that pertains to the search terms. Since our focus here is on what an advertiser can control, we’re going to assume that editing the webpage is not an option (but if you do have this option, it’s recommended). However, if an ad’s landing page experience score is “below average,” there are still a number of ways you can improve it. One way would be to try pulling your ad copy directly from the landing page. This should improve your landing page experience and could also improve your ad relevance and expected CTR if your landing page pertains to your keywords.

By comparing all three ad quality metrics, Google calculates the ad’s Quality Score, which is graded on a scale from one to 10.

One commonality between the three metrics is the recurring theme that ad copy plays a large role in determining ad quality. Advertisers have typically used ad copy to entice searchers to click on their ads. However, if you’ve ever analyzed search-query data, you would know that searchers don’t always read ad copy or even skim it, for that matter. Sometimes people just click on whatever is in the first spot, regardless of whether it’s relevant to what they’re looking for.

That being said, perhaps advertisers could benefit from using ad copy in a different way. Instead of attempting to persuade searchers to click on your ads with stereotypical advertising tropes like, “best prices online” or “satisfaction guaranteed,” advertisers could fill headlines and description lines with a combination of keywords, search terms, and landing page text. This would, in theory, check all the boxes for above-average grades in expected CTR, ad relevance, and landing page experience, giving your ad a Quality Score of 10.

Ad quality data identifying the difference in average CPC due to small variations in Quality Score.

A difference of even just one point could mean paying nearly three times as much for a click in the same position. This is due to the way Google grades your ad versus the other ads in the auction, which is known as Google Ad Rank thresholds. And that’s the second of the three Ad Rank components we can control. 

2. Ad Rank Thresholds

Although Ad Rank thresholds aren’t necessarily something advertisers can control, understanding what goes into determining them is important. Once you understand how Ad Rank thresholds work, you can figure out a way to take advantage of it.

Google’s definition of Ad Rank threshold is as follows: “The reserve price of your ad. If your bid is lower than the threshold, your ad won’t show. And if none of your competitors are eligible to show, the threshold (reserve price) is the price you pay for the click.”

This is where things can get a little confusing because while Ad Rank Threshold is one of the six components that determine Ad Rank, it is made up of five components itself! And the components are fairly similar to the ones that make up Ad Rank. 

Ad Rank uses five elements to determine Ad Rank thresholds.

The positions on the SERP are tiered, and each tier has a minimum Ad Rank threshold that your ad must meet in order to compete for that position. As shown above, the tiers are determined by the following five factors:

  • Ad Quality: We’ve already talked about ad quality, but how exactly does it factor into the threshold? Google wants the searcher to have a “high-quality ad experience,” so lower-quality ads will have to hit higher thresholds. Essentially, better ads pay less for the same position.
  • Ad Position: The higher the position on the page, the higher the threshold will be.
  • User Signals & Attributes: Thresholds vary from search to search. The context of a person’s search (location, device, etc.) will affect the thresholds. For example, a search in the United States will have different thresholds than a search in Australia. Similarly, a search on mobile will have different thresholds than a search from a desktop.
  • Topic & Nature of the Search: The cost of a click varies from industry to industry. Therefore, thresholds will also vary from industry to industry. If someone is searching for personal injury lawyers, that click is going to be more expensive than a click on an ad for new running shoes.
  • Related Auctions: The verbiage of a search can affect the threshold as well. For example, the thresholds of a search for “Nike” running shoes will be similar to the thresholds of a search for “Adidas” running shoes.

Most of what determines Google Ad Rank thresholds is dependent on the searchers and their queries. In fact, outside of spend, ad quality is one of the few things advertisers do have a say in. But there is one more Ad Rank factor you can influence.

The final element of Ad Rank is the expected impact of ad extensions.

3. The Expected Impact of Ad Extensions

With the expected impact of ad extensions, Google takes into consideration how your ad extensions will impact the performance of your ads. It’s another totally free way to improve your ads’ Ad Rank. Using ad extensions typically increases CTR. While it’s not entirely clear if there’s a correlation between expected CTR and actual CTR, it’s not unreasonable to think that if you improve your ad’s CTR, it could also improve your expected CTR. An improvement in expected CTR would improve your ad’s overall Quality Score, allowing you to move up into a higher Ad Rank threshold.

With Google’s introduction of Performance Max campaigns, it has thrown another wrinkle into determining ad rank. Because these new campaigns touch almost every network Google offers (search, shopping, display, etc.), it’s tough to know which campaign type takes precedence over another if you are running both a Performance Max campaign in congruence with a search campaign, shopping campaign, or display campaign. 

From what we’ve seen so far, it seems like Performance Max will trump most of the other campaigns in almost all scenarios. However, when it comes to search campaigns, if the search query is an exact match to a keyword in your search campaign, the search campaign takes precedence over the Performance Max campaign and wins the auction. But if the search query matches your keyword in any other match type outside of exact match, the ad with the higher ad rank will win the auction. So, it’s important to make sure you are taking advantage of any and all ways to improve your ad rank to make sure traffic is going to the appropriate channel. 

So there you have it, the six components of Google Ad Rank. Take your newfound knowledge of how your ad copy influences Ad Rank, and optimize your ads to drive stronger PPC campaign performance. The money you will save on clicks will be well worth the time.

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