Any person advertising on google, who ever tried to ask them a simple enough question knows exactly what i'm talking about.
I started a campaign approximately a month ago, and quickly noticed this roller coaster minimum Cost-Per-Click ride that google took me on.
Min CPC would jump from .18 to .23 to .60 in a matter of days.
Keep in mind all of this is happening while nothing changed in the campaign except for the CTR which went UP! (landing page, keywords, adgroups and ads all remained the same).
So I asked this person from Google to please explain to me what is happening to my account...
Guess what she tells me? "Sir you will need to improve the Quality Score in your account because that's the only thing that will bring down the price."
We all know that the quality score plays a major role, but i changed nothing and my CTR went up and so did the prices!
She then blurts out something else like: "here at google we look at the whole experience of the web-user, so the quality of the ads are very important"
"Web-user's quality" she tells me...
How about improving quality for the web-users that actually put money in your pocket?!
You can start by providing some normal answers to simple enough questions.
This is a reasonable question i'm asking, why do the prices go up?
What can i do to prevent this and continue to play ball with google?
Would rather stay on hold with Yahoo for an hour, then deal with this highway robbery. Where you have to adjust your estimates of EPC (customer value) and other metrics every 8 hours...
With the introduction of the quality score and the associated minimum bids the waters are becming murkier though. Through the min bids, Google is able to influence the auctions. The opaque nature of the quality score doesn't help Google's cause. Especially not since how they say the quality score operates and the experiences of so many users are completely opposite. The example mentioned in the previous post is just another example of this.
By tweaking the QS algorithm, Google is able to directly influence its revenue (high min bids --> more revenue) and this is where the line becomes relevant results and the corporate bottom line becomes blurry.
something i just had to get off my chest...
G's not tweaking the algorithm to drive bids up, they're tweaking the algorithm to drive bids up for sites they think will be of little interest to people who click on ppc ads - that's a huge difference. For starters, every business has the right to control their product's / service's quality to make sure they stay attractive to consumers. Also, since this is an auction, driving up the minimum bid for undesired sites removes people from the auction - that doesn't drive prices up, it removes the lesser sites from bidding.
So I have "bought" into what they say they do, I see it everywhere, again and again. However, I have a close friend who has a site that gets marked low for quality and for the life of me, I can't figure out why. So I'm not blind to their system being imperfect, but the conspiracy theories that G is doing this to drive up prices is just misguided nonsense. If they want to drive up prices, since people who do the paying are measuring their ROI that they get, what you do as an engine is maintain quality (fight fraud), improve targeting abilities and provide more data so advertisers can continue to find ways to maximize their spend with you - of course that doesn't make for a very sexy conspiracy theory.
As the poor performance of your campaign became evident they increased your minimum bid.
Find a way to offer what the visitor wants.
My other point is that by introducing minimum bids, Google DOES have the ability to set influence prices. Combined with Google's marketshare, that enables the company to behave as a monopoly.
The performance of your advert is obviously not what Google had predicted. They thought you were going to have 100 clicks a day, that 30% of visitors wouldn't come back and click another ad. They found that you got only 40 clicks a day, and only 3% of visitors stayed on your site.As the poor performance of your campaign became evident they increased your minimum bid.
I have a campaign that started at .05c and then for weeks the quality score was OK with min bids of .10-.15 then about 6 weeks later the bids went down to .03-.04 range. I changed nothing on my end.
So google figured my ad/landing combo is poor and raised my min bids and then 6 weeks later when i OVERPAID substantial amount of money they figured my ad improved and is now great? All while i changed nothing.
The problem i see here is that if my break even point and my max bid was .09c at .15 cents my keywords would become inactive and at this point google would stop gathering data. I would be filtered out indefinitely even though operantly my ad is great: CTR 11% CV rate 8%. ad group has only 3 keywords that are super targeted "buy blue widget".
I'll give you another big problem as i see it with quality score:
The minimum bids are jumping the same in ALL INDUSTRIES 3c 4c 5c 10c 15c 20c 30c 40c etc...
In finance vertical .10c .20c min bids are not an issue at all I personally bid several dollars a click. Now, try selling a book or some other low margin item with 15c or 20c minimum bid. So here a pattern emerges: in high margin / high bid verticals things are not that bad. In low margin areas advertisers are choking. And surfers do look for those low margin items and lots of times it is hard to find because advertisers can not conveniently deliver that item above the search results.
I used to start my day with analyzing stats and ROI, now i start with checking quality scores in all accounts - it is time consuming and at times very frustrating in low margin areas.
Personally, I think they need more gradients. Going from $.50 to $1 to $5 with no steps in between seems very arbitrary and simple-minded.
One thing that they should look at is queries where no ads are showing. I'll have keywords that I'm running that get high minimum bids and where no other ads are showing. I understand that Google is concerned about quality, as I am, but some user queries will lend themselves better to ads than others. The solutions is not to effectively prohibit ads for those types of queries. Maybe you limit the number of ads shown, maybe you try a few other things, but I actually think it is a disservice to users to have no ads showing.
As a user of Google myself, I would rather have some marginally related ads than no ads at all. Some people are very anti-ad, but I often find ads useful when I'm shopping for products, looking for information, etc. I actually feel like I'm getting less when I enter a search on Google and only get organic results and no ads.
Some of the most significant deficiencies are:
Other factors are reputed to include:
If you can achieve an Excellent Quality Score then you might be faced with a minimum bid of 4¢ whilst a landing page with a Poor Quality Score for the same keyword might require a bid of at least 90¢ just to be active.
"And i am not saying that they are tweaking the algorithm to increase revenue."
Ummm, yeah you are.
"But any changes in the algorithm DO influence their bottom line directly and it would be naieve to think that revenue is not important for such a large publicly traded company."
It would be naive to think G can raise prices that they determine and that ad revenue would stay the same. If prices go up, your ROI goes down and you make adjustments, namely, lowering your bids or working on something else to lower your costs (like quality score!).
Since bid price alone doesn't directly determine your position or your actual xosts, it would also be naive to assume that when a competitor of yours is scored poorly for quality (or removed from the auction entirely via high min bid), that your costs would go up. That's not how an auction works. Quality scoring essentially devalues the bids of your poor performing competitors, either lowering them so far below you that they don't affect your price or removing them entirely.
"My other point is that by introducing minimum bids, Google DOES have the ability to set influence prices. Combined with Google's marketshare, that enables the company to behave as a monopoly."
Yes, G's quality scoring affects pricing, making it expensive for low quality sites to enter the auction. But the affect that has on others and your concepts of it combining to cause or create a monopoly is just incorrect. They do not control the omlone advertising market, they control their share and they control it better than their competitors by strongly favoring the value they present to users / consumers.
I don't dispute that when you've been graded poorly and your costs invrease, that you feel like you're getting hammered. But the alternative would be to ban you from the auction, instead they try to provide financial incentives to those who help them achieve their goal of pleasing the consumer.
Like I said, I know of one seeming exception, but besides that, quality scoring seems to me to be great for advertisers and is a critical piece of keeping people interested in clicking on PPC ads.
While I do agree that QS can serve as an incentive for advertisers to improve the quality of the user experience and/or conversion rates, I again go back to the fact that Google execs discuss QS and 'monetization' interchangeably in their quarterly earnings calls. There are two worlds: one where G tells the SEM community that QS is a beautiful market-enhancing feature that should be trusted implicitly as pushing for 'quality', and another where G answers the investment community's incredulous 'How are you beating our estimates all the time?' questions by saying that QS and broad match - among others - allow G to control its own monetization destiny.
Markets are more or less efficient, and G's stock is down 20% this year because the market realizes that the QS-min-bid-pain, way-too-broad broad matching and AdSense-pie-getting-smaller are symptoms of a company whose fundamentals are worsening.
-Shorebreak
I still cannot agree about the QS theory being related to
the bid prices, because NOTHING changes in my campaigns (except for the CTR going up) and the prices still keep on climbing.
Google has been hit hard, stocks are down to 300$.
Don't you guys laugh when you hear the financial gurus
who blame the current market for the falling google stock?
I think it's guys and gals like us that are tired of Google's non-stop Samba dance with our bid prices. Obviously tired frustrated marketers tend to turn more towards other venues of PPC advertising (overture, ad center etc). Probably this is the number 1 reason why
Google is making less.
Or am i wrong? May be the Adwords gurus have been able to figure
out how to calculate their ROI , if your marketing expense is always
jumping up... Seems impossible to me, but what do i know.
Let me know what you think.
Find a way to offer what the visitor wants. "
Anyone heard of this metric a la google?
stock wise and news wise, yahoo looks like mangled baby ducks and msn is looking hostile whilke G quietly allows the ups and downs to come (as they always do) and to pass.
do G's competitiors look like they're gaining ground? forget beating them, i see them trying to be like G and having a hard time even doing that.
$6B anchors don't help your leaky sailboat blow by the leader.
Ever think that maybe, it's their algorithm thats flawed? There's one algorithm the judge every single website in every single market, and you're surprised that there are a few anomolies every once in a while?
