"Increase Ad Rank and Reduce Cost-Per-Click with a Predikkta Survey on Google AdWords."

Pay-Per-Click Advertising or PPC is a web-based marketing model, in which advertisers pay a fee each time one of their ads is clicked on.

Improve Pay-Per-Click Advertising PPC

PPC is a quick method employed by website owners to direct traffic to their website. PPC advertising is a frequently used marketing tool, as it is the fastest way to be highly ranked on the Search Engine Result Page and is part of Search Engine Marketing (SEM).

Google's advertising platform, “AdWords”, is based on bidding per keyword model. As an advertiser, you decide which keyword phrases you would like to trigger your ad for, and you choose a maximum price you are willing to pay if a visitor clicks on your ad.

Sounds simple doesn’t it? But be warned, PPC can be deceptively simple for an advertising tool – there are multiple factors impacting on Google’s AdWords. For example, you are chasing the keyword “plumber” and have decided to place a maximum bid of $10. You have been ambitious, and have easily outstripped your competition – the average Cost-Per-Click (CPC) bid is $5. On the face of it, you can expect to be placed right up the top, considering you are paying the most.

Quite often, however, the highest bidder is not ranked as highly as would be expected. This is because Google AdWords takes into account other factors to measure an ad’s position on the SERP (Ad Rank).

Google AdWords

Based on Google's algorithm, each time a search is initiated, an automated auction between different “advertisers” starts and Google chooses a set of winners to appear on the search engine result page. Unlike a normal auction though, AdWords uses a 'second price auction', where the highest bidder doesn't always win (get the highest position). This is because Google wants to give the searcher the most relevant search result and winners are decided on factors like Cost-Per-Click and Quality Score.

Ad Rank formula

Cost Per Click (CPC) is the maximum amount of money you are willing to pay for each click.

Quality Score is Google's rating of the quality and relevance of both your keywords and PPC ads, and consists of:

  1. Ad relevancy: How relevant are the ad text, URL and keywords to the search query?
  2. Click-Through-Rate: The higher your historical and expected CTR is, the better Google values your ads.
  3. Landing page: Is the landing page of good quality and relevant to the search query?
  4. Ad formats: Adding ad Extensions like Sitelinks, Phone Number or Location make your ad more relevant.

Due to the influence of the Quality Score, Ad Rank can be higher than your competitors, even if you have the lowest maximum CPC bid! See the table below:

Max. Bid Quality Score Ad Rank Total Your Price
Advertiser 1 $2.00 10 20 $ 1.61
Advertiser 2 $4.00 4 16 $3.00
Advertiser 3 $6.00 2 12 $4.00
Advertiser 4 $8.00 1 8 $8.00

But how does Google determine what you exactly pay?

The price you pay for a click on your ad is determined by dividing 'Ad Rank of the Advertiser Below You' with 'Your Quality Score' + '$0.01'.

Ad Rank formula

So, if we have a look at the table again, the price Advertiser 1 pays is $1.61 and Advertiser 2 pays $3.00.

Increase CTR on AdWords

It is said that CTR accounts for 60% of the Quality Score, and is therefore the most important component. This is because a high CTR is a strong indication to Google that your ads are relevant and helpful to users. Also, Google doesn't get paid if no one clicks. This is why Google prefers good ads that are relevant and have a high CTR.

There are two main factors which can influence Click Through Rate of PPC ads.

First of all, bid on the right set of keywords. Consumers go through different stages of a buying journey and therefore you should focus on bidding on high commercial intent keywords. Examples are “branded keywords” or actual products and services (e.g. 'Levi 507 Jeans', 'Samsung Galaxy S5', and 'Survey software'). These types of keywords have much higher CTR than informational keyword searches (e.g. 'how to fix a tyre', 'where does coffee come from', etc.)

You might have selected the relevant keywords for your ads, but is the ad copy appealing enough? Does it really attract visitors and encourage those extra clicks, or is your copy just another ad on the SERP? Ad copy is therefore the second factor influencing CTR on Pay-Per-Click advertising.

Test Ad copies with Predikkta

As an advertiser, you should stand out from the crowd and stop being an average or below advertiser. It is very important to have an attractive relevant ad copy. If you do not, you will have higher costs with lower returns, which then influences your Quality Score and ultimately your Ad Rank.

Google AdWords offer A/B testing on ads, but how to start with the right ad? Too often, businesses are not creative enough, or do not spend enough time creating that initial appealing ad.

Ad Rank formula

Getting the initial ad is hard, and on top of everything else you have to monitor the ad daily and continually A/B test it to improve your CTR. Businesses often do not want to 'miss' customers, so they make the ad copy so general that only few people are interested in clicking through.

With Predikkta you can test thousands of different ad copies, in one survey, to find the most attractive ad and increase Click Through Rate. Start your AdWords campaign by optimizing Click Through Rate from the get-go.

Predikkta offers the AdWords Optimizer Tool, in which you can test different ad copies against each other via an online survey in a simulated environment. This way, you can find the most appealing ad out of a set of ad copies without testing it live on AdWords and losing time and money doing so.

Try our AdWords Optimizer now