Google has announced an improvement in the AdWords auction that will let the search giant show more relevant ad extensions & formats to searchers.
Ad extensions provide more information to potential customers and also the additional ways to respond. These typically improve the clickthrough rate as well as the overall performance of the campaign by making the ads more useful.
Improvements in Ad Rank
Ad Rank is a calculation used by Google's system for ordering ads on search result pages. Earlier, Ad Rank was calculated on the basis of max CPC bid and Quality Score. The latest update has brought with it a third component that will be taken into account while calculating Ad Rank. The third component is the expected impact from ad extensions and formats. Google has also increased the importance of Ad Rank in finding out if your ad is eligible to be displayed with formats & extensions.
Google revealed more details and implications of changes. Here's the information on the official AdWords blog:
- “Ad extensions and formats can now influence the position of your ad on the search results page. If two competing ads have the same bid and quality, then the ad with the more positive expected impact from extensions will generally appear in a higher position than the other.
- When estimating the expected impact of extensions and ad formats, we consider such factors as the relevance, clickthrough rates, and the prominence of the extensions or formats on the search results page.
- Because Ad Rank is now more important in determining whether your ad is shown with extensions and formats, you might need to increase your Quality Score, bid, or both for extensions and formats to appear.
- In each auction, we'll generally show your highest performing and most useful combination of extensions and formats among those eligible. So there's no need to try to guess which extensions will help improve your clickthrough rate the most.
- You may see lower or higher average CPCs in your account. You may see lower CPCs if your extensions and formats are highly relevant, and we expect a large positive performance impact relative to other competitors in the auction. In other cases, you may see higher CPCs because of an improvement in ad position or increased competition from other ads with a high expected impact from formats.
- For now, this update only affects search ads appearing on Google Search."
Recommendations for Using Extensions
Extensions make ads more useful and can also improve the performance of the campaign. So, AdWords team recommends you to add extensions that make sense to your business type and campaign goals. With the recent improvements in AdRank, Google expects its systems to do more to automatically serve extensions, when they are most beneficial.
Google has cited an example to explain this:
“For example, consider someone downtown searching on a mobile phone for "auto repair." In this example, the user might be most likely to respond to your ad when they can click to call a phone number or tap a link to get directions to visit in person. So we may show a combination of call and location extensions with your mobile search ad.
Now imagine if someone were searching for "auto repair" on a laptop computer in the suburbs. Say your ad earned the 3rd ad position above the organic results in this auction. We might show your seller rating and sitelinks because that's the highest performing and most useful combination of extensions that could be shown with your ad in this particular auction and ad position”.
AdWords team expects that AdRank changes will help in serving more relevant ads as per the user's intent and context. The update will show most useful combination of formats and extensions. Google has also updated its Help Center articles on ad extensions and how we rank ads.Google Improves Ad Rank to Show Up More Relevant Ad Formats & Extensions!,