On Google groups he explains -

Since a minimum bid is a direct reflection of the Quality Score, the data in this new column (values: Great/Okay/Poor) can help advertisers decide if they should take any action to improve

Just to give you a rough estimate of how minimum bids and thesequality “buckets” currently align… “Great” keywords have a minimumbid less than or equal to $0.04, “Okay” keywords have a minimum bid between $0.05 and $0.30, and “Poor” keywords have a minimum bid thatis higher than $0.30.

The above minimum bid ranges may change over time.

The Seroundtable also reports that an advertiser has been charged for clicks accrued while their Adwords campaign was paused. I am willing to take a bet that these impressions and clicks were from the content network, as I reported previously, this technical problem has STILL not been resolved by Google.

Further news on the quality score update suggests there was a bug in the system causing minimum cpc’s to rocket, as reported by Jeremy Mayes -

Unfortunately, due to a technical issue, you may notice that the minimum bids for some of your keywords increased dramatically, despite them being high performing, good quality keywords. This is a temporary issue that our engineers are aware of and they are working to resolve it as soon as possible. I am sorry for any inconvenience.

Seroundtable has now reported that the bug has been fixed by Google. So what caused the problem?

We won’t find out, but we do know that Google were specifically tweaking the minimum bid area of the quality score algorithm again. As the Inside Adwords blog explains -

First, we’re improving the way that we set minimum bids for keywords where we have limited data. For example, if the system does not have any data on a keyword, we’ll try to assign that keyword a lower initial minimum bid until we have enough data to make a more accurate assessment of the Quality Score for that keyword in your account. Second, we’re improving the Quality Score algorithm to make it more accurate in predicting the quality of all ads.

Not all went quite to plan then?. On a more positive note Google have introduced new features that allow advertisers to pause and resume keywords, adverts and sites (if its a site targetted campaign) aswell as rolling out the much talked about quality score column to the masses.

Definitely the most useful of those will be the ability to pause adverts. Why? Because it means you can KEEP ad history which makes up an important part of the quality score algo.

Take for example a client who runs the same promotional adverts once a month. Previously advertisers have always had to create NEW adverts which would have no history or amend current ads to reflect the promo which would in turn mean you lose the ad history upon edit. Furthermore, when the promo period ends, the advertiser was once again forced to delete or amend adverts back and lose history all over.

Now you can simply pause and resume them when it suits you while maintaing the history you have built.

Pausing keywords could be useful in some circumstances, but unlike adverts, keyword quality score is kept at account level. If you delete the keyword then re-add it, it will still hold the same history.

The difficulty in really understanding the Google Quality Score algo, is the lack of transparency shown by Google, especially with introductions such as the new landing page quality update. So what do we actually know about Quality Score? How can adwords Quality Score be maximised to increase profitability? How do I know what Google deems as ‘quality’? Lets look at this from the begining.

Quality Score

What is the Google Quality Score?

“Quality Score is the basis for measuring the quality and relevance of your ads and determining your minimum CPC bid for Google and the search network. To encourage relevant and successful ads within AdWords, our system defines a Quality Score to set your keyword status, minimum CPC bid, and ad rank for the ad auction”.

What factors influence Quality Score?

• CTR on Google.com
• Ad Copy
• Ad text relevance to query
• Historical keyword performance
• More recent history (Google places more emphasis on recent history or CTR data than long term data)
• Landing Page Quality (This only directly effects minimum cpc)
• Other relevancy factors. “There are over 100 factors that can affect quality score. However, not all will be triggered depending on the conditions involved.”

What is the Quality Score forumla?

Quality Score = (keyword’s CTR, ad text relevance, keyword relevance, landing page relevance)*

Multiple Quality Scores

Although Google speak of a ‘Quality Score’, many advertisers do not understand that QS is actually held at multiple levels which act in different ways. Quality Scores are held at the following levels -

1) At Account level – Determined by combination and overall peformance of keywords including (CTR) and history. Quality Score is held here for individual keywords, so if they are moved from campaign A to campaign B, it will still have the same past QS. Spend has been rumoured to be part of the equation, I don’t buy it personally…

2) For the Google Search Network – A Quality Score is held seperately for the search network which inturn applies to keyword & minimum cpc quality scores (below).

3) At Adgroup level for Content – Determined by ad groups overall average keywords performance, along with CTR, ad copy, history and other relevancy factors.

4) At Keyword Level – A Quality Score is given and held by individual keywords weighted by their individual performance to the QS factors above.

5) Quality Score Based Min CPC- This is measured by evaluation of keywords in your account, the relevant adgroup, advert relevance, CTR and history. More and more importantly, landing page quality has become a major factor in determining minimum bid prices.

6) Landing Page Quality Score – Google have introduced landing page quality score that directly influences your keywords minimum cost per click.

The New Landing Page Quality Score

Currently landing page quality only influences minimum cpcs and is not part of the ad rank algo (we will get to that). If you read my interview with Graywolf about the whole landing page quality update, you will know that having the landing page quality as a independant factor which only determines min cpc means that advertisers can still rank if they were prepared to pay the price for it.

So how is landing page quality calculated & how can I improve it?

It’s the million dollar question of the moment. Take a read of Googles guidelines for creating a high quality landing page. Their emphasis is on user experience, responsibility & security to the user. Tips include -

• Provide relevant, unique and substantial content on the product or service.
• If your site displays advertising, distinguish sponsored links from the rest of your site content or think about removing completely.
• Add an ‘about us’ page
• Add a short privacy policy
• Add details on returns / refunds
• Add a contact details page
• Think about linking out to relevant respectable authority sites

Quality Score, Ranking and CPC

So Google has applied and measured a Quality Score to just about everything, how does this fit in with ranking and the price I pay per click?

Ad Rank

How does Google rank Adverts for Search?

“Keyword-targeted ads are ranked on search result pages based on their maximum cost-per-click (CPC) and the keyword’s quality score on Google.com. (For the top positions above Google search results, we use the actual CPC.)”

What is the Forumla for Search Ad rank?

Ad Rank = CPC X Quality Score

So is ad rank for content different?

For a keyword-targeted ad’s position on a content page, Google looks at:

• The ad group’s content bid or, if content bids aren’t enabled, its maximum CPC.
• The ad’s past performance on this and similar sites.
• The relevance of the ad’s landing page.

Actual CPC

So how does ad rank and Quality Score effect the actual price I pay?

In determing the actual cpc you pay for a click (rather than the max cpc), Google will look at your ad rank and quality score against those in direct competition.

“The actual CPC that each advertiser pays is the minimum amount needed to maintain a rank number higher than the next lower ad”.

What’s the forumla for actual cpc?

Actual CPC = Ad rank of below advertiser / Your Quality Score + 0.1p

The actual cost per click calculation is determined by the ad rank of the advertiser directly below you, divided by your own Quality Score + 1p.

Take a look at Googles own actual cpc example here. As you can see, the actual cpc you pay can be lower than those who rank below you, as in the case of advertiser B.

The Future of Google Quality Score

Google are testing the introduction of a visible Quality Score, to help advertisers understand where they need to improve. But will this really tell us anymore than we can probably already work out ourselves? Will this clear up the lack of transparancy in some aspects of the algo such as landing page quality? Undoubtably no.

Another big change for Quality Score will be the inclusion of landing page quality into the algo for ad rank rather than just setting bid prices. The landing page algo update has mystified many advertisers, so how will this impact ad ranking when its included?

Are we getting to pent up about Quality Score? Should we just concentrate on user experience & good business practices which will in turn maximise profitability anyway? Heh.

Still confused about Quality Score? I have listed some great links from Google that should provide light on each key area further.

Quality Score

Quality Performance overview
Quality & Performance Factors

Landing Page Quality

Landing Page Quality Overview
Landing Page Quality in the Learning Center

Ad Rank

Ad rank & Ad Position Overview
Ad ranking in the Learning Center

Actual CPC Formula
Actual CPC Forumla Explained
Pricing & ranking in the Learning Center

TroubleShooting – Keywords, Ads, Landing Pages & minimum CPC.

Quality Score Column The Quality Score column displays your keyword’s Quality Score to help you monitor your keyword relevance. This is a customizable column that is disabled by default for new accounts. It can be enabled at any time. Each keyword will be labelled with one of three possible Quality Score states: Great, OK, or Poor. Your ads may be performing effectively and with lower costs if your keywords have Great or OK Quality Scores. However, keywords with a Poor Quality Score may need to be replaced with more specific keyword choices. If you don’t want to replace poor quality keywords, you can try optimizing their associated ad text and landing pages. To learn more about optimizing your ads, keywords, and landing pages, visit our Tips for Success page.

Why are Google only going to show such limited detail on quality score with only ‘Great, OK, or Poor’ as a guide? Well, they must be pretty nervous about some advertisers having to much information. Here are some comments from Nick Fox in a interview over at Traffick

“Google is currently exploring ways of providing more of this type of information to advertisers. The problem is, if we give too much information about the process to the bad guys, they’ll turn around and use that to circumvent the process….Potentially it helps the bad guys optimize, so we have to be careful how we implement this.“

• The Quality and Performance Overview section includes 11 topics meant to define quality and performance, and to help understand AdWords system behaviors.
• Within the Quality and Performance Factors section, you’ll find links to more than 25 topics on Quality Score, quality-based minimum bids, landing page quality, ad postion, and clickthrough rate (CTR).
• The Troubleshooting section offers more than 15 helpful links that can assist you in troubleshooting your keywords, ads, landing pages and minimum bids.
• Lastly, the Improving Ad Performance section offers 20 or so topics on choosing successful keywords, creating targeted ads, and optimizing your account.

So overall thats 71 helpful links for advertisers.

I’m glad Google made the whole quality thing so simple.

If you read my interview with Graywolf about the whole landing page quality update, you will know that many deemed having the landing page quality as a independant factor which only determined min cpc meant that advertisers could still rank if they were prepared to pay the price for it. Which kind of makes Google look more interested in cash than being completely focused on ‘user experience’ as they preach. If the advert isnt great quality then don’t rank it.

I have outlined the interesting points of the post below;

Traffick: So, I’ll assume a whole range of factors are involved in deciding ad rank but that along with bid, CTR History is, as Google has said in the past, “predominant.” But you’re saying that landing page quality does not currently affect ad rank; landing page quality only affects minimum bids.

NF: We’ve been debating this internally, and it’s my feeling that our users will benefit even if we push the landing page quality measure into the quality score that affects ad rank. Basically, I advocate all of the factors being used in the actual rankings of the ads, not just affecting minimum bids. So I’m pushing for landing page quality being included in the ranking formula and I think you’ll see that soon.

Nick also confirmed the rumours that I posted a few days back regarding the possibility of having quality score shown at adgroup level

Traffick: How can you provide more information to advertisers who have low quality scores, and is there some way advertisers can appeal high minimum bids that might be based on “algorithmic false positives”?

NF: Google is currently exploring ways of providing more of this type of information to advertisers. The problem is, if we give too much information about the process to the bad guys, they’ll turn around and use that to circumvent the process.

Traffick followup: So they try to “fix” it, but the intent is not to really fix it.

NF: Right, the intent is not to really fix it. In any case, Google is running a test now — we haven’t formally announced it yet, but I guess I’m going to tell you now — showing in the front end, quality score information to the advertiser. This is sensitive. Potentially it helps the bad guys optimize, so we have to be careful how we implement this. As for the editorial process and appeals, today there is an escalation process, and Google can correct mistakes if it sees that a mistake has been made. There are actually few enough of these appeals that I get to see all of them personally.

Interesting stuff.

Next month I’ll beta test the Quality Score Column in AdGroup Detail (I’ve been invited by Google), if you wish I can do some experiments as I’ll be able to see Quality Score for each keyword in real time. So I can confirm if this is true or not.

Andrew Goodman has already voiced his concerns regarding Googles lack of transparency and it seems the new update has brought about further debate over at Threadwatch.

A threadwatch member, Graywolf has published some interesting statistics which highlight the lack of understanding we currently have in how Google determine landing page quality and its direct correlation with the minimum bid you are forced to pay. Remember, landing page quality does not effect your ad rank, it only determines your minimum cpc.

In this particular case a keyword has a 11% CTR and 41% conversion rate, which to anyone would seem to be performing very well – Yet this keyword has been forced with a high minimum cpc with the latest update. Now remember, Googles landing page quality score is there to help improve user experience, is this really whats happening with a 41% conversion rate? It would suggest not.

Does the landing page algo have problems or are we witnessing Google using the lack of transparency as a tool to just increase their revenue?

Whichever way you look at it, with the complete lack of transparency, Google are able to pretty much do as they please without the fear of repercussion under what it can deem as a landing page quality score update – rather than just a hike in bid prices.

Danny Sullivan went a little further with his thoughts;

you told them your conversion rate?!!! Plenty of people have been paranoid that if Google say conversion rates, Google would push up the prices on things that work. It’s not hard to think that if they see a term getting lots of clicks (number 1 pulled twice number 2) and a high conversion and a low CPC, up the CPC. Not saying this is happening, but with even less transparency, I think it gives people even less reason to want Google to see what their conversion rates off. Might be interesting to track your conversion outside their system and see if that stops those type of changes.

So what do we think? Is this really in the users best interests? Or is this a charade for Google to make even more profits…

If Google is really after the MFA sites and arbitragers, why does it not just try and enforce its polices properley?

• No Google ad may be placed on any non-content-based pages.
• No Google ad or Google search box may be displayed on any domain parking websites, pop-ups, pop-unders, or in any email
• No Google ad may be placed on pages published specifically for the purpose of showing ads, whether or not the page content is relevant.

Well, Shoemoneys latest post explains

“Keep in mind Google is not going to stop letting you do this… They are just going to charge you more cause of your “quality score”. There is just to much money to be made right now in arbitrage and Google wants a bigger slice.”

More conversation on this over at the SEW forums.

Google has cleared this up by stating the landing page quality only directly effects your minimum bid, not your ad postion.

Will my landing page quality affect my ad’s position?

Not for Google search. While one’s landing page quality is directly correlated with the minimum bid required for one’s ads to run, it does not affect your ads position (or ‘rank’, as it is often referred to) at all. However, since there is no minimum bid requirement for contextually-targeted ads, low quality landing pages will result in the need to bid higher to compete in the auction, which could also impact your position on pages in the network.

This time instead of just effecting the search network advertisers, Google seem to be trying to reduce traffic to sites that offer a ‘poor user experience’ on their content network to.

Google explain “In the next few days, we will be making two changes to how AdWords evaluates landing page quality. First, we’ll begin incorporating landing page quality into the Quality Score for your contextually-targeted ads, using the same evaluation process as we do for ads showing on Google.com and the search network. Advertisers who may be providing a poor experience on their site will notice that their traffic across the content network decreases as a result of this change. Second, we’re improving our algorithm for evaluating landing page quality and incorporating landing page content retrieved by the AdWords system. “

So it looks as though they are once again after the MFA type sites getting cheap clicks on the content side aswell, in theory traffic should be limited somewhat by Googles algo update to these. Plus it looks as though there’s further updates for the search network too!

Google continue “As with our July system update, both of these changes will affect a very small portion of advertisers, so the vast majority of advertisers will not be affected at all by either change. However, those who may be providing a low quality user experience will see an increase in their minimum bids for Google.com and the search network and/or a decrease in traffic across the content network. In most cases, we expect that the higher minimum bids will cause the low quality ads and keywords to become “inactive for search.”

What do you think of this change? Is it a little arrogant of Google to think they can police the web and identify what ingredients make up a good user experience for everyone?

Are we getting a little tired of the lack of transparency shown by Google?

Check out some of the conversation over at Threadwatch.