Very interesting new feature.
It inuitively feels wrong to set positions by Adrank score and THEN to abuse the Adrank model with an override system - but hey - monkey see, monkey do.
I guess it will damage the unwary. I can see people insisting on positions 1-3 with ads that have no hope of ever reaching an Adrank that gives them top 3 in a month of Sundays. They don't put the CPC up enough to compensate, then come back a month later and wonder why they still haven't spent their first fifty punds/bucks yet.
|The only downside I can see happening is in competitive markets, there will be a dozen people targeting positions 1-3. Because an ad will not show if it doesn't meet that ad rank score |
There has to be other downsides. Can't see them... but I've only read your post so far. Maybe I should go and look at it properly for myself.
As eWhisper mentioned, there is a real danger that CPC prices will climb even higher when this launches. Does this mean that previous click thru rates and landing page relevancy importance are slightly diminished?
Will people with horrible click thru rates be able to obtain a #1 or #2 ranking just because they are willing to outspend advertisers who have worked hard and 'followed the Google rules'?
"There has to be other downsides."
One other downside could be more time spent on bid management - checking constantly to see if in fact your ads are #3 when you've said that's what you want them to be. Currently you don't really see (if you've been a long-time advertiser) you ad position fluctuate that much during a typical day - now that's a real possibility.
What we potentially now have is an Overture scenario where bid management becomes a huge task.
What we potentially now have is an Overture scenario where bid management becomes a huge task.
- couldn't agree more!
So what if everybody tries to bid their way into position #2 instead of #1 -- will position #2 start to cost more? And I thought I was confused before...
It sound like if you are happy with your current campaign performance, then you might actually get more clicks at a lower cost, rank higher on the page and see your CTR increase. If 6 of the top-10 advertisers competing for a keyword put in a target position of 1-3, then only three of them may show and your ad should move up on the page at a lower cost unless your bid price is still calculated based on other advertisers who are not showing because they requirements have not been met.
As the CTR of the ads that used to be lower on the page increases, it sounds like those who want to appear only in the top spots will either not show at all or have to raise their bid prices to get any exposure if I understand this correctly.
I assume this will be the usual gradual roll out
|This means that if your Ad Rank is not high enough with your current CPC to reach the position you want to show your ad in, then your ad won't show at all. |
Not sure I get this. Does this mean that a strategy of "Rank me as high as my max bid will allow but never more than 3rd (and whilst you are at it never charge me more than one penny more than 4th)" is not possible. If so what implications for third party ranking tools?
Think it is going to take me a little while to get my head round exactly what this means in terms of the ranking algo.
Complications are what keep me interested in this game and the AdWords team are certainly good at providing me with no shortage of interest.
|One other downside could be more time spent on bid management. |
I was reading somewhere recently that Google may be getting ready to roll out it's own Bid Management Program effectively eliminating the need for third party providers. Not sure if this is pure rumor or not, but it makes sense. Even more so now with this new Position Preference feature.
This feature just doesn't make much sense to me. How many advertisers know their ROI at different positions? Who really pays a lot of attention to that so much so that they want to be turned off if they aren't where they want to be?
The only way this feature makes any sense IMO is if they combine it with an auto-bidder of some sort. So I am guessing that will be the next feature added. Not sure I like the idea of Google controlling everyone's bids. That's going to increase prices for sure..
In my opinion, this doesn't change much except help those who already were satisifed with their positioning.
At an efficient point, every advertiser is bidding at a point which will yield the max ROI. Any good ppc bidder would know off-hand the approximate location their ad was, and the ROI it yieled.
This new feature just makes it easier to track, but I don't think we'll see people who bidded lower earlier raising their bids or some huge inflation of PPC, specifically because this info was available in one form or another earlier on. And most people should have adjusted their bids from the beginning to accordingly fit the position that best reflected their goals.
I think this helps the people who are in a high position and only want to solidy it for the sake of ROI. For example, it may not be worth the CPC to bid on #3--if I always needed #2 to break even.
Despite the dire predictions, I can also envision a "race to the bottom".
It is pretty well established that often the #2 ad gets more attention than the #1, and at least one study has shown that #1 and #3 get about the same. (and oddly or not, the bottom often ranks in the top 2, even if it the 6th ad).
So if we all bid for #3....
I rank #1 for many terms, and my ads do well also. I would not mind knocking my ads down from 1 to 5 or 6 for certain terms where my organic results are good.
Is there any formal research on the best position to have?
Suppose if I were in photography where if a person seems my site and picks me over compition, I would earn a sizeable amount of money. Should I always shoot for number 1 or number 2 or what?
That's just a hypothetical but is there any research like that?
Having an extremely large AdWords campaign it makes my head spin to think about the amount of time and resources that are going to have to be alloted to getting this figured out for each ad group. :S I'm interested to see what kind of tools they come out with for management of this feature.
Maybe the competition for #3 will be so much that the bid will be more than #1...
|Is there any formal research on the best position to have? |
Never seen any really scientific ones. Seen writeups on several small studies done, and while sometimes interesting the results are not consistent enough to build an advertising blitz on.
Most that I have seen seem to indicate that the best ad position is #1, #2, or the bottom one (since many people tend to scan ad lists from the white space at the bottom and go up). But even that varies - one showed that #2 was the best spot, another showed #1 best by a small margin. But #3 (unless it is the bottom one also) nearly always is #3.
And another problem with these studies is that use patterns tend to change over time. What people new to the web look at changes as they get more familiar with surfing - and at least one study noted that banner ads tend to fall off the edge of the world for long time users - they simply don't see it. But that study might be biased also, since it was only done on one ad - other things such as color and design could also affect it.
This should be beneficial to many (but not all)
Especially beneficial to Google, capitalizing on those highly competitive words (which are also usually the most searched for words)
Cha Ching for Google!
Yikes. Most professional Adword buyers know that being on the top has the propensity to get you a disproportionate amount of looky-loo clicks. From an ROI perpspective being on the right side is the most optimal between 3-6.
So, what happens when 100 bidders want to be positioned at 5 lets say. I guess the highest bidder gets it, regardless if position 2 may be less competitive. I am assuming that Google expects every position on the first page to be aggressively bid on. Can an ad buyer bid on every position and prioritize which one they want first, second, thrid, etc... in case they do not win their desired bid position.
My take is this:
1. Google wants/needs more revenue
2. Google thinks that position bidding will generate higher CPCs due to people willing to pay a premium to have a listing at a certain spot. So why do this? Very simple. Google's Avg CPC costs have been getting lower. Not good for Google. Why? Most professional bid management companies are not bidding for the top spot - this in turn lowers Google's potential to generate a higher CPC. Why? Take a course in game theory and/or study the Cobb-Douglas production function theorem which deals with the laws of supply/demand and the willingness a consumer has to pay for a certain product /service within a competitive environment. Google is smart - they realize their is demand for a specific bid position and want to capitalize on this fact.
3. Google does not care how much effort it takes you to do bid management. In fact, the worse you are at it, then the more likely you will be bidding too much. Which is good for Google. Google can get away with this since they are pretty much the only show in town (Yahoo not withstanding).
I've said it before - PPC companies have signed up everybody who is anybody.
The only way for them to keep increasing their revenue is to add new 'features'.
Worse than 'money', new features always seem to consume a huge amount of our 'time'...
Anyone knows when position preference is launched?
On a few of my accounts the feature became "active" in the sense that positions could be selected. So far it appears to be inactive with respect to actually responding to the preferences set.
It would be nice if the position preference also appeared on the 'edit ad group bids' screen (where one can change bids for several adgroups at once).
This would allow one to manage positions at the keyword or adgroup level (just like bids).
Something is buggy with the interface. It often fails to save when there are 500 keywords per page, especially if there are lots of different positions set.
With Google *potentially* developing its own bid management solution, do you think it's bids will become public info like Yahoo's? I was just reading the thread about the API quota...hmmm.
more accurate management of the bid position would come in handy. we spend well over USD 1 million a year on google ads. with that volume we do track each ad. what we found is that advertising less then rank 3 is a money waster. potential buyer may click, but already made their mind up when hitting bid one and two. rank two can save you a lot of money, plus you can put pressure on rank one by driving up the bids.
for the potential customer it is imperative that he/she finds the same ad at the same spot ALL the time. this also eliminates the use of budgets, as the ad does not always show. we found that rather then bookmark a site, visitors go again through google to find the ad/site.
a sticky point for us is that ads globally (lets say google US/DE/UK etc..) do not always show at the same position/rank. this gives us little control for ad control globally. I think this is one feature ad management should provide, i.e. having features in place to set bid position by market.
Anybody seeing any effects from setting position preference? I've been running it for several days and it doesn't seem to make any difference.
Interesting feature but i have more negative than positive expectations and the same time it will become more complicated for advertisers to manage their compaigne
|Anybody seeing any effects from setting position preference? I've been running it for several days and it doesn't seem to make any difference. |
Tested it this weekend, and it took a day to 'warm up' but it eventually worked...