What is AdRank
To determine the position of where on Google’s search results page the ad ends up (ranks) and how much the advertiser pays each time someone clicks on an ad, Google uses something they call AdRank. The higher an ad ranks, the higher position the ad appears on the search results page.
Parameters affecting AdRank
The following parameters are affecting how the AdRank will be determined:
- Maximum amount the advertiser is willing to pay for a click
- The quality score of the ad
- Extensions in the ad
Maximum bid
The maximum bid corresponds to how much the advertiser can imagine paying for a certain keyword / keyword phrase to trigger an ad to be displayed and for someone to then click on the ad.
Quality Score
The quality score is determined on a scale from 1 – 10, where ten means that the ad is extremely relevant. See section further down about the quality score.
Ad extensions
Ad extensions add additional information about the company to the body of the text ad. This can be e.g. more information about the product, including product highlights, relevant links and pricing. It can also be information about the company.
Google Ads extensions make ads more informative and help searchers make decisions. Ad extensions reinforce the arguments for the visitor why she should click on the ad. The larger size of extensions in the SERP makes them more effective.
Privacy policy
A fourth factor that also contributes to AdRank (not shown in image 1) is if the ad states that the website has a Privacy Policy, Integrity Policy or similar. Such policies describe how the company handles personal data, information about GDPR, etc.
Parameters affecting the Quality Score
The higher value of the quality score the more relevant the ad is. A Quality Score of 10, which is the highes possible, is usually only achieved by keywords that contain the advertiser’s brand name.
The following parameters are affecting how the Quality Score will be determined:
- Expected click through rate
- Relevant ads
- Useful and relevant landing page
Expected click through rate
Expected click through rate. This expectation is based on historical data held by Google that relates to the specific ad in question. Click Through Rate CTR is calculated by taking the number of clicks on the ad divided by the number of times the ad has been shown to those searching for keywords linked to the ad as a percentage. For example, the ad has been shown 1000 times, clicked on 100 times 100/1000 as a percentage = 10% click frequency.
Since Google strives for relevance, it uses the click frequency as a measure of quality. The greater the percentage that clicks on the ad, the more relevant Google considers that users perceive the ad.
Relevant ads
Google rewards those advertisers who offer relevant ads to their searchers by showing them in higher positions at a cheaper click price. The “better” an advertisement fulfils a visitor’s expectations of what she is looking for, the more satisfied the user is. The more relevant and useful the ad is, based on specified keywords, the better the quality score.
Useful landing page
The higher the usability and relevance the visitor feels the landing page has, based on the keywords she used, the higher the quality score is achieved.
How high AdRank reduces ad expenditures
The more energy the advertiser has worked with AdRank and its parameters, the more effective and cheaper the advertising can be. Image 3 shows a fictitious example of how AdRank affects click price and ad position.
Conclusion
Understanding AdRank, its constituent parameters and working with these provides great opportunities for higher ranking and lower expenses for advertising.
