What I love about being an Advanced Experienced AdWords Expert as I have been for years now (and I am using the word LOVE sarcastically here) is that I keep finding out things that I have assumed for years are wrong. And that if I read Dave Barry too much- and I am not making this up- I start to write like him.
It is only because I have teachers in the form of AdWords Dedicated Account Representatives that I have these frequent stunning realizations.
So here’s another myth by the wayside:
If you bid more, your cost per click will go down because your CTR goes up and your Quality Score goes up because QS is so dependent on CTR.
Ok maybe you didn’t follow that- so here’s the myth in visual form:
Here’s what the AdWords Lady said:
CTR is normalized in regard to quality score so ads in top positions which usually have a high CTR don’t have an unfair advantage. While higher positions tend to have a higher CTR, we expect higher positions to have a higher CTR.
For example, we know that when an ad appears in position 4 it has an x% CTR. When that same ad moves up to position 1, with no other change, that same ad has a CTR of x+y% CTR. When we calculate quality score, we remove the impact of the y variable so that we just have the intrinsic CTR of the ad, independent of position. Therefore, while increasing bid may increase CTR, that increase alone should not improve the advertiser’s quality score.
The below blob posts give more insight into this topic as well.
That really got my goat- not only does it appear that my myth may have been true up until October of 2008, but it also appears I should be reading the Google AdWords blob more carefully. And that got my goat even more- I didn’t know Google had blobs. There’s a chance she meant “blogs” but since Google has Waves now, I think they really could also have Blobs. Or maybe I’m just making a stupid joke about her being dumb because I felt dumb. I don’t know, I’ll ask my therapist when she gets back in town.
So, since AdWords shows ads at a variety of positions and really only tells you the average position, they somehow gather a normalized CTR via some statistical magic I’m not educated enough to understand, and use THAT as that CTR to multiply your bid by. Voila!
Very cool. And smart, because if they didn’t normalize CTR, whoever was in the top position would have an unfair advantage.
It also means that you have to care more about the effectiveness of your ad copy again. Because THAT’s what determines your normalized CTR and quality score and required bid for a given position.