Google is changing the way they measure your Quality Score. Though Google uses an auction bid type system for its Adwords management, much of your position ranking is currently determined by how relevant Google deems your structure, ad, keyword and landingpages are with one another. Then it takes that score, factors in your account history, click through rate and many other factors and this final “score” is often called “Quality Score” or “index”. If this Quality score is too low, Google will raise the minimum bid required to show your ad. This is how more established players who have good history and have properly structured and optimized accounts can out position you with a $0.10 bid while you may be unable to show your ad even at a $2 bid.

The news out of Google is that in the next few days, the Quality Score, which used to be static and by keyword, will now be calculated at the time of each query.

In addition, the always dreaded minimum bid will be no more. Keywords will no longer be marked “inactive” and given a chance to show. Consider though that keywords that were previously inactive probably were inactive due to a low Quality Score, so don’t expect a huge jump in traffic unless those keywords have very little competition but high volume. (What words are those?). The minimum bids will be replaced by a “first page bid”. First page bids are determined using the exact match version of the keywords and the ad’s Quality Score.

What does this all mean? How does it affect me?

Good Question. Unfortunately it’ll depend on your account. For LeadQual and their clients, my initial reaction is mixed.

Real Time Quality Score System – Great

This new quality system will most likely be beneficial for LeadQual and any other agency that knows what they are doing. (Note, there are 100s of agencies out there and they are definitely not made equal. They made sound the same, but the quality of work will varying tremendously. Ask our clients. Seriously, we’ll give you references!). Every time a new intricacy is built into Google system, it gives us the opportunity to further optimize our accounts to reap the benefits and edge out the competition that do not know how to utilize the new features. Tighter structures, tighter ad relevancy will be top of our priority list as these new features roll out. SEM Managers out there should really think about how to best restructure their accounts so that each keyword is mapped to an Ad Creative that is highly relevant. This may mean creating much larger, more expansive accounts. It will be more difficult to manage, but the rewards could be tremendous.

First Page Bids – Not so Great
I do not like this move by Google. Yes it gives advertisers a number to look at that they sorely want to know. I don’t know how many people I’ve worked with always ask why their keyword is not showing on the first page. We would then try to explain that it isn’t just about showing on the first page. High position is important for maintaining a good click through but what should ultimately determine what price you want to pay is the ROI and margins you are trying to target. This new features makes it too easy to get to that first page. It will most likely increase dumb money being spent which helps Google but not the consumers who use the engines nor the agencies that work hard to place bids by the ROI. To clarify, “dumb money” is a term used to describe money being wasted due to a lack of information or understanding of how search works. It is money that is not tied to ROI needed to make the numbers work. LeadQual currently calculates out the first page bid through careful bid management, but now it will be visible for anyone to see and in a matter of seconds many advertisers will be fighting for that first page . This unfortunately increases competition. The only benefit I see is that the extreme dumb money will be curbed. This means the local businessmen and huge brand players (usually the culprits of dumb money) may stop paying $5 to $10 a click if they knew they could pay $1.25 for the first page. But overall there is a very real potential this will raise competition and result in higher CPC costs in the coming months. Again great for Google, not so much for LeadQual and it’s clients.

I have a pretty high perception for Google and the moves they make as they are generally geared towards improving the user experience versus a engine like Microsoft which has some very questionable UI features purely built to increase profits. Because of my high perception of Google, I am somewhat disappointed by this latter move. At least they didn’t go all out like MSN Adcenter. Every time you go into MSN’s UI to make a bid change there is a giant button next to your bid field that says “bid to first position”. I am certain many have used that feature and wasted 1000s of dollars

…. and I am out like minimum bidding.

Paul Lee
Director of Online Marketing
LeadQual – SEM

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