Havas Media Group Focus :: Google AdRank Extensions


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Google made a big change in October to the algorithm behind ranking ads in paid search. With this update, AdRank will take into account an additional component - the expected impact from your ad extensions and formats. This POV explores the impact of this change in detail and helps marketers understand how to adapt their AdWords approach accordingly.
Read our Havas Media Group focus to understand more.

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Havas Media Group Focus :: Google AdRank Extensions

  1. 1. google adrank extensions November 2013
  2. 2. HAVAS MEDIA GROUP FOCUS Google AdRank Extensions Lead contributors Anna Stoyanova Search Director Havas Media UK anna.stoyanova@havasmedia.com Eleonore Quint Search Manager Havas Media UK eloenore.quint@havasmedia.com Mark Sutton Search Manager Havas Media UK mark.sutton@havasmedia.com Claudia Rowe Search Manager Havas Media UK claudia.rowe@havasmedia.com Daniel Hinton Search Executive Havas Media UK daniel.hinton@havasmedia.com Lisa Butterworth Search Executive Havas Media UK lisa.butterworth@havasmedia.com © 2013 Havas Media Group 2
  3. 3. HAVAS MEDIA GROUP FOCUS Google AdRank Extensions Google made a big change in October to the algorithm behind ranking ads in paid search. What is the change? Google uses a calculation called Ad Rank to determine positions for paid ads. Previously, Ad Rank was calculated using max CPC bid and Quality Score. With this update, Ad Rank will also take into account a third component: the expected impact from your ad extensions and formats. Below is the official statement from Google for this change: “When people use Google to research and buy things, they’re interested in the most relevant and useful results. Ad extensions help by providing more information to potential customers and additional ways for them to respond. For example, they can call your business number, see your business location on a map, or choose an even more relevant landing page that you’re promoting with sitelinks. Ad extensions typically improve clickthrough rate and overall campaign performance because they make ads more useful.” More information is available on the official blog: >> http://adwords.blogspot.co.uk/2013/10/improving-ad-rank.html What is the expected impact? Improvement for the user experience on Google: • It will encourage advertisers to improve the quality of their ads even more since they will need to increase their ad rank to reach higher position for the extensions to appear. • In Search results we expect to see more relevant ads, with beautiful extensions that will be the most relevant to the users. © 2013 Havas Media Group 3
  4. 4. HAVAS MEDIA GROUP FOCUS Google AdRank Extensions We will hopefully see less of this... And more of this... For Advertisers, there are pros and cons: • The overall performance of the ads is likely to improve since the algorithm will show the highest performing ad extensions combination. • The average CPC might decrease if the combination of format and extensions is relevant and the Ad Rank is improved. • We can however as well expect the average CPC to rise at first given that extensions show on high positions and the competition might be more aggressive to rank in these positions. © 2013 Havas Media Group 4
  5. 5. HAVAS MEDIA GROUP FOCUS Google AdRank Extensions What we make of it • Overall we think this is a logical move by Google, if you’re doing a good job of managing your activity and creating good, relevant ads then you should be rewarded for it rather than just giving the top spot to the highest bidder. Similar to how your Quality Score suffers if your mobile offering is bad / non-existent, this change should only penalise advertisers who are behind the times, so for most savvy companies and agencies this is a positive change. • The only part of the announcement that is perhaps a little odd, is that the impact of your ad extensions will form a third factor in ad rank alongside Quality Score and bid. Given that the impact of your extensions is likely to be directly related to their quality, it would have made more sense that this factor was included in Quality Score rather than considered alongside it. The fact that ad extension impact will be a third factor implies (though of course is not confirmed) that its weighting in the ad rank calculation will be more significant than had it been absorbed into Quality Score. • What is needed going forwards is an extension level quality score or some other similar indication from Google as to how much impact your extensions are having on your ad rank so people have some basis on which to optimise what they’re using - there’s presumably been something like that created in order to factor extension impact into the Ad Rank calculation, but advertisers need visibility on that in the front-end. Google is promising to improve reporting for ad extensions. • This change is also likely to punish the smaller advertisers, who aren’t big spenders or run by big agencies and thus don’t get access to the various betas. If extensions that are still in beta get factored in then it would penalise those who can’t access them, unfairly benefitting large advertisers. • In any case, the adoption of ad extensions is likely to increase and create additional competition for the top positions. • On the other hand, SEO may lose out even more (or so it seems) by pushing organic search results lower and lower down the page. This would however give rise to some interesting testing opportunities. © 2013 Havas Media Group 5
  6. 6. HAVAS MEDIA GROUP FOCUS Google AdRank Extensions Next steps • Ensure you are taking advantage of relevant ad extensions for your business. Speak to your PPC team to prioritise the implementation of higher impact vs lower impact ad extensions. • Consider higher involvement with beta products which will give you a head start and most likely a competitive advantage when the product is fully released. • Monitor campaign performance closely and optimise ad extensions to improve performance - e.g. test different sitelinks combinations or image variations. © 2013 Havas Media Group 6
  7. 7. www.havasmediagroup.com Produced by Havas Media Group