Is Google Quality Score Taking Away Strategic Bidding?

google-quality-score-taking-away-strategic-bidding

I play the guitar during my free time (that’s right, not all search marketers are nerds). Okay, back to the article.

Recently, I have been searching online trying to find the best price on a particular guitar effect pedal that I am trying to get. I had been through all the sponsored ads and eBay listing and came to realize that everyone is selling it at the same price. Maybe the manufacture had set the retail price, or there is an agreement between all the retailers, the fact remains that not a single one of them has any competitive edge over the others (at least price-wise).

This got me thinking. How would the consumers react when they see all the PPC advertisers offer the same value?

Let’s go back to my pedal-shopping experience. When I realized that I couldn’t get any deals from any of the sponsored ads, I really had no preference on whom I should buy from (same offers one shipping, guarantee, etc). I could’ve bought it from the first site I visited, the last site I visited, or anywhere in between.

So how would each advertisers decide on how much they should bid on their keywords, or more precisely, which position would generate the most ROI?

One may believe that being at the first position would generate the most exposure therefore having the highest chance of converting. Others might believe that consumers will shop for the best price and visit all the listing from top to bottom, and when they reach the last ads and realize that everyone sells at the same price, they might as well just buy from the site they are currently on and save all the troubles. Advertisers who believe in the latter would try to rank on the bottom of the SERP.

The point being, every advertiser has their own bidding strategies!

Let’s assume that the “ranking-at-bottom” strategy does work (and it has for some of my clients), and to cut the cost even lower, the advertiser choose to state the price in the ad hoping that the customers are aware of the price before they decide to click on the ad (once again, this has been proven successful for some of my clients). It’s quite obvious that the bottom-rank advertisers would have a lower click through rate (CTR).

Now the problem comes!

According to the article Is The Hype Over Google AdWords Quality Score Justified? by Craig Danuloff on Search Engine Land, keyword quality score is mainly affected by the keyword’s click through rate and the click through rate of other keywords in the ad group and account. With this quality score system, the bottom-ranking and price-in-ads strategy would result in low click through rate for the keywords, and when the quality score gets too low, the keywords would be deemed “ad rarely shows due to low quality score”.

In order to keep the ads running, advertisers now have to abandon their once working strategies and keep bidding higher or rewrite their ads to attract more clicks when they clearly realize they will be just flushing money down the drain. So who’s the really benefiting from this quality score system?

Consumers? Or Google!

Pitstop Media offers ROI based internet marketing services. If you need help with PPC management or PPC optimization please contact us for a free, no obligation quote. We’ve helped companies reduce their paid advertising cost by as much as 48% and increase AdWords conversion rates by as much as 410%. See our internet marketing case studies.

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About 

Steve worked for Pitstop Media Inc as a Pay per Click (PPC) specialist, helping clients maximize the value of their PPC campaigns. He is also a musician and a part-time sound designer for TV/film.

 

One Response to “Is Google Quality Score Taking Away Strategic Bidding?”

  1. Eric said:

    Jun 05, 09 at 7:16 pm

    Ha – you can count one more search marketer who plays guitar to add to your non-nerd list.

    As for your nerd elements in the post – Perry Marshall has posted tests he’s run on which position produces the best ROI for Google AdWords, and it tends to be (bonus info for anyone happening to read this comment) about position 8. Less clicks, but also less cost per conversion. This doesn’t always mean better ROI is overall better – a lot of people are happy to give up some percent to get higher profit, even at a loss in ROI.

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