Ad Scheduling Bid Adjustments for your Campaigns in Google AdWords

We have seen how to setup and use device level bid adjustments and location based bid adjustments. This blog is focused on ad scheduling bid adjustments. You can use ad scheduling bid adjustments to increase or decrease your bids for campaigns that show only on certain days or during certain hours. But before we get to ad scheduling bid adjustments, let’s revise the fundamentals of bid adjustments quickly.

What are Bid Adjustments?

Bid adjustments allow you to set the frequency of your ads. You can adjust the bid based on the time of the day, the location of the user, the device that the user is on when using Google search and more. Bid adjustments come in handy when you want to target certain audiences from a particular geography, a specific device or a particular time to show your ads.

In this blog, we will learn to setup a custom ad schedule followed by bid adjustments for the ad schedule.

How to setup a Custom Ad Schedule?

Note: Ad scheduling is available only for campaigns with “all features” enabled.

  1. Pick a campaign you want to setup a custom ad schedule for.
    ad scheduling bid adjustments
  2. Switch to setting after selecting the campaign.
    ad scheduling bid adjustments
  3. Select the ad scheduling tab under setting menu.
    ad scheduling bid adjustments
  4. If you have never scheduled an ad before, click on +ad schedule button.
    ad scheduling bid adjustments
  5. You will be prompted to choose a campaign.
    ad scheduling bid adjustments
  6. Once you choose the campaign ro schedule ads for, click on + create custom schedule.
    ad scheduling bid adjustments
  7. Now you can schedule your ads from the available options and hit save.
    ad scheduling bid adjustmentsThis is how you setup a custom ad schedule for a campaign of your choice. There a few thing you need to keep in mind though. The ad schedules you set are based on your account’s time zone. Therefore, you should adjust your ad schedule keeping in mind the time zone your target customers are in.
    The ad schedule is based on a 12-hour or 24-hour clock. Therefore, to schedule an ad to run from the end of one day through a portion of the next day, you should create an ad schedule for each day. If you are using a 12-hour clock, for example, to run an ad from Monday 11:00 P.M to Tuesday 7:00 A.M, your ad schedule for Monday should extend from 11:00 P.M to 12:00 A.M, while your Tuesday ad schedule should run from 12:00 A.M to 7:00 A.M.

    How to set Ad Scheduling Bid Adjustments?

    Once you have scheduled ads for your campaign following the steps above, adjusting bids for the same comes as a continuation. To create a new ad schedule and adjust its bid, you can start from step 1. If you want to adjust bids for an already existing ad schedule, you can start from step 8 (see below).

  8. From the list of ad schedules, select the row of the schedule that you want to set a bid for.
    ad scheduling bid adjustments
  9. Once you have selected the ad schedule, click on set bid adjustment tab.
    ad scheduling bid adjustments
  10. You can either increase the bid or decrease it. Enter a value in the box and click make changes to set the adjustment.
    ad scheduling bid adjustments
  11. You can leave the box empty to remove the bid adjustments.
    ad scheduling bid adjustments

An example of Ad Scheduling Bid Adjustment –

Let’s say you are advertising on AdWords to promote your new Art Exhibition that you are hosting at your home in Bakersfield, California. You are open from 10 AM to 4 PM on weekdays and from 11 AM to 8 PM on weekends. You have scheduled to show your ads on weekdays from 10 AM to 4 PM. Similarly, ads will show from 11 AM to 8 PM on weekends. You want to promote your weekend ads as there are other exhibitions open on weekends too. Now you use ad scheduling bid adjustment to increase the bids for the 11 AM to 8 PM ad schedule.

You increase your bid by 30% for 11 AM to 8 PM ad schedule.

Your starting bid: $5
Ad scheduling bid adjustment: + 30%
Resulting bid: $5 + (30% x $5) = $6.5

Hence, for any user searching for an art exhibition on weekends, your bid will be $6.5.

Note: Ad scheduling bid adjustments are not available for campaigns using an automated bid strategy.

The above example illustrates the usage of ad scheduling and ad scheduling bid adjustments. You can combine ad scheduling with location based and device level bid adjustments too.

Let’s see how you can combine two or more bid adjustments.

From the above example, we know that your bid for weekends is $6.5. You are adding location based bid of 20% for users who are in Bakersfield.

Your bid after ad scheduling bid adjustment: $6.5

Location based bid adjustment: +20%
Your total bid: $6.5 + (20% x $6.5) = $7.8

Hence, for any user searching for an art exhibition on weekends from Bakersfield, your bid will be $7.8.

Similarly, you can add more bid adjustments for your campaigns to improve the targeting of your campaigns. To understand how bidding in AdWords work, please read our AdWords auctions blog. And for more AdWords concepts, visit our AdWords and PPC blog.

Device Level Bid Adjustments for your Campaigns in Google AdWords

In the previous blog, we understood the working of AdWords auctions in detail. We discussed Google’s adaptation of Vickrey Auction called Generalized Second Price Auction. We learned about Maximum Bid, Actual Bid and different Quality Factors that Google considers when deciding the Ad Position. I have also mentioned about Bid Adjustments. I will be explaining the basics of bid adjustments, how they can help an advertiser and what different types of bid adjustments (device level bid adjustments etc) are available in AdWords.

What are Bid Adjustments?

Bid adjustments allow you to set the frequency of your ads. You can adjust the bid based on the time of the day, the location of the user, the device that the user is on when using Google search and more. Bid adjustments come in handy when you want to target certain audiences from a particular geography, a particular time or a specific device to show your ads.

AdWords offers three basic bid adjustments, Device, Location and Ad Scheduling. In this blog, we will see how device level bid adjustments can be set.

Note: Bid adjustments are set by percentages either at campaign level or at ad group level.

How to set Device Level Bid Adjustments?

  1. Pick a campaign to which you want to add device level bid adjustment.
    device level bid adjustments 1
  2. Switch to setting after selecting the campaign.
    device level bid adjustments 2
  3. Select the devices tab under setting menu.
    device level bid adjustments 3
  4. Click on the cell corresponding to the device (computer, mobile, tablet) you want to adjust bid for in the Bid Adj column.
    device level bid adjustments 4
  5. You can either increase the bid or decrease it. Enter a value in the box and click Save to set the adjustment.
    device level bid adjustments 5
  6. You can leave the box empty to remove the bid adjustments.
    device level bid adjustments 6

Additional Information about Device Level Bid Adjustment –

You can set device level bid adjustment at ad group level too. Instead of selecting a campaign, select an ad group and follow the steps mentioned above.

Note: When you set a device level bid adjustment for a campaign and an ad group within that campaign, the ad group bid adjustment will be used to determine your bid.

The range of device level bid adjustment is -90% to +900%. If you don’t want to show ads for a particular device, set its bid -100% (decrease by 100%).

Note: If you decrease a campaign’s bid by 100% for a particular device, then the ad group-level adjustment for that device won’t be used.

An example of Device Level Bid Adjustment –

Let’s say you are advertising on AdWords to promote your Mobile Performance Optimizer app. Users searching from a mobile device are more likely to click on your ad rather than those on tablets or computers. You can use device level bid adjustment to bid higher or lower depending on the device the user is on.

  • You increase your bid by 50% for mobile devices.Your starting bid: $5
    Mobile bid adjustment: + 50%
    Resulting bid: $5 + (50% x $5) = $7.5Hence, for any user searching from a mobile, your bid will be $7.5.
  • You decrease your bid by 30% for computers and tablets.Your starting bid: $5
    Computer and tablet bid adjustment:30%
    Resulting bid: $5 – (30% x $5) = $3.5

Hence, for any user searching from a computer or tablet, your bid will be $3.5.

I hope the example has given you an idea on how you can use device level bid adjustments to render your campaigns more efficient. Following the above steps you can set device level bid adjustments to your campaigns. We will discuss location based bid adjustments in the next blog.



Location Based Bid Adjustments for your Campaigns in Google AdWords

We have learned the basics of device level bid adjustments and how to set them up in the previous blog. We have also discussed how auctions in AdWords work. In this blog, we will see how location based bid adjustments can be set. But before we get into that, lets recap on what bid adjustments are first.

What are Bid Adjustments?

Bid adjustments allow you to set the frequency of your ads. You can adjust the bid based on the time of the day, the location of the user, the device that the user is on when using Google search and more.

Note: Bid adjustments are set by percentages either at campaign level or at ad group level.

You can use location based bid adjustments to target audiences from specific geographies. You can also adjust bids for locations where you don’t want to show your ads.

Say you own a chain of cafes, you can use location based bid adjustments to customize your ads or bid higher for such locations.

How to set Location Based Bid Adjustments?

  1. Pick a campaign to which you want to add location based bid adjustment.
    location based bid adjustments 1
  2. Switch to setting after selecting the campaign.
    location based bid adjustments 2
  3. Select the locations tab under setting menu.
    location based bid adjustments 3
  4. Click on the cell corresponding to the location you want to adjust bid for in the Set Bid Adjustment tab.
    location based bid adjustments 4
  5. You can either increase the bid or decrease it. Enter a value in the box and click make changes to set the adjustment.
    location based bid adjustments 5
  6. You can leave the box empty to remove the bid adjustments.
    location based bid adjustments 6

Additional Information about Location Based Bid Adjustment –

Unlike device level bid adjustments, you can’t set location based bid adjustments at an ad group level. This setting is available only at the campaign level. However, the range of location based bid adjustment is also -90% to +900%. And if you don’t want to show ads for a particular location, set its bid -100% (decrease by 100%).

Note: You can also add new locations to target. In the screenshot below, you see a + locations button left of set bid adjustments. You can target a specific city, a region under the city, a state or a country as a whole too.
location based bid adjustments 7

You can also use location extension to target users who are located around your business area. Using the location extension, you can show your business location, phone number, and a marker on the map. You can specify a radius around your business location and bid accordingly using location extension.

An example of Location Based Bid Adjustments –

Let’s say you are advertising on AdWords to promote your new chain of cafes in New York. You have multiple outlets operational in Queens, Brooklyn and JFK Airport, but not in Manhattan. Users looking for a cafe from Queens, Brooklyn and from around JFK Airport are clearly the ones you want to target. You would still want to show up for people searching from Manhattan because you are opening shortly, but you don’t want to bid high. However, you can adjust your bid based on the location of the users to improve the impact of your ads.

  • You increase your bid by 25% for locations Queens, Brooklyn and JFK Airport.Your starting bid: $2.5
    Location bid adjustment: + 25%
    Resulting bid: $2.5 + (25% x $2.5) = $3.125 Hence, for any user searching for a cafe around Queens, Brooklyn and JFK Airport, your bid will be $3.125.
  • You decrease your bid by 20% for location Manhattan.Your starting bid: $2.5
    Location bid adjustment:20%
    Resulting bid: $2.5 – (20% x $2.5) = $2.0

Hence, for any user searching from the Manhattan region, your bid will be $2.0.

The above example is to give you an idea on how you can use location based bid adjustments. Following the above steps you can set location based bid adjustments to your campaigns. We will discuss ad scheduling bid adjustments in the next blog.



How does AdWords auction work?

.We all are very familiar with auctions and AdWords auction is very similar to them. A traditional auction is a public process of bidding for (buying and selling) goods/services. Instead of fixed prices, participants place bids. The highest bid is declared the winner and the product is sold off. A bid is a price the participants are willing to pay for a good/service on auction.

Google AdWords also follows a similar approach. Advertisers use AdWords to bid on different keywords. A single keyword can have multiple bids. And a single keyword also has multiple winners.

What are advertisers bidding for on AdWords?

The simplest answer is Keywords. But it is not entirely true. Advertisers are bidding to show their ad copies for particular keywords. To make this idea easily understandable, I will use an example.

Let me introduce you to four advertisers Aman, Bob, Caity, and Disha. These advertisers are using AdWords to promote their Microwave Safe Boxes. Hence, all of their keyword lists are identical. For a keyword, Microwave Safe Boxes, all of them have placed a bid. Aman bids $2, Bob’s bid is $3, Caity’s bid is $4 and Disha’s bid is $5. A user looking for Microwave Safe Boxes types the same on Google Search.

Advertiser Max Bid Ad Position (tentative)
Aman $2 4
Bob $3 3
Caity $4 2
Disha $5 1

What would happen now?

Every time a search query is entered on Google Search, an auction takes place. Yes, on an average, Google runs three billion (approx) AdWords auctions each day. There are four participants and four bids in this auction for the keyword Microwave Safe Boxes. And the aim of these participants is to win the AdWords auction and get their ad shown to the user.

Whose ad will be shown to the user?

It is very obvious that the highest bidder wins. So in the above situation, Disha wins the AdWords auction and Google awards her ad the first position on the Search Engine Results Page (SERP). But that is not it. Caity’s ad will also be listed on the results page. Her ad will be in the second position followed by Bob’s ad in the third position.

To avoid any confusion, let me explain what just happened. Google offers more than one position for advertisers to showcase their ads. In fact, on a SERP, Google provides up to eight ad positions. Four of them appear on the top, i.e. above the organic results on the results page. And four more appear at the bottom, below the organic results.

Note: There are other parameters besides the advertiser’s bid. We have considered them to be constant for now. We shall discuss them a little later in this blog.

How much does an advertiser pay?

This question might sound very silly, but trust me, it isn’t. Most of the readers would give a definite answer very promptly. However, the bid amount an advertiser agreed to pay is not the answer.

Disha bid $5, but Google doesn’t charge her $5 for her ad. Google charges her $4.01. Caity bid $4, but she pays Google a sum of $3.01 to retain the second position. Similarly, Google charges Bob $2.01 to place his ad third on the results page.

What is Generalized Second Price Auction?

Before I clarify why Google charged Disha $4.01 only and Caity $3.01, let me introduce you to the concept of Generalized Second Price Auction (GSP). A Second Price Auction or Vickrey Auction is a bidding process where multiple bidders bid for a single item. The highest bidder wins, but they have to pay the price of the second highest to keep the product. Generalized Second Price Auction (GSP) is an adaptation of Vickrey Auction; Google uses this approach when selling AdWords ad positions.

When there are multiple items to be sold to bidders, auctioneers follow GSP. And in AdWords, these items are ad positions on the results page. Every bidder places their bid. Auctioneers sort all these bids in descending order. The highest bidder wins the first position and the second highest bidder wins the second position and so on. But Google charges each winning bidder the bid of the next highest bidder.

I believe you can now relate to why Google charged Disha only $4.01, Caity $3.01 and so on. The additional one cent is to outbid the next highest bidder and retain the current ad position.

This is a very easy breakdown of how Google auctions the ad position/slots for AdWords advertisers. But this is not it. Google considers various other factors besides an advertiser’s bid to decide whether an ad is listed or not.


In the above example and in the explanation that followed the example, please read an advertiser’s bid as Maximum Bid. Maximum Bid is the amount an advertiser is willing to pay to Google for a given keyword and the ad associated with the keyword. An advertiser defines the Maximum Bid well ahead of the auction. It is not the Actual Bid. Actual Bid is what Google charges the advertiser after the AdWords auction. Actual Bid for an advertiser is usually a cent greater than the bid of the advertiser in the second position.

What quality factors does Google consider before adjusting an advertiser a winner in the auction for ad position?

It is true that AdWords auctions don’t just use the Maximum Bid as a cue, there are other factors associated. And it is important to understand why these additional factors are essential.

Google follows a well-defined norm to help advertisers and user. And the additional factors (we haven’t discussed them yet) help Google stick to this norm.

“Showing relevant ads at a higher ad position.”

Google understands that its users want to see ads that actually mean something to them. Likewise, advertisers also want to present relevant ads to users to gain clicks and accelerate their business growth.

Now let’s look at the quality factors that Google uses to assess the quality of an ad before deciding the position of an ad.

  • Expected Clickthrough Rate: Google considers the feedback of the users. Google counts every click of a user as a vote. Hence, a good click-through rate means approval by majority users. Thus, Google deems an ad with a good click-through to be the best for a particular search query.
  • Landing Page Experience: Hal Varian, Google’s chief economist very rightly points out that an ad is only useful to a user if the landing page helps them find what they are looking for. For the benefit of users as well as advertisers, Google recommends a high-quality landing page.
  • Ad Relevance: Google equipped its algorithms to analyze the language in an advertiser’s ad copy. And by this analysis, the system determines how relevant it is to a search query. This way, advertiser’s don’t have to worry about losing money on irrelevant/low-quality clicks.

What is Ad Format?

Ad Format: Even though this isn’t a typical quality factor, Google is particular about the ad format too. An ad with an extension containing a phone number, website URL, and additional information is of more benefit to a user than a bland ad. Ads offering more value will also drive a better click through rate. Likewise, ads with more information are more relevant.

Google combines quality factors and ad format impact with maximum bid set by advertisers to derive a score for ads. This score is called the Ad Rank. Google uses ad rank to decide an ad’s Ad position (higher or lower).

Quality factors and ad format impact are clubbed into a Quality Score.  Google then multiplies the Quality Score with Maximum Bid to derive the Ad Rank.

Ad Rank = Quality Score x Maximum Bid


Google ranks Quality Score on a scale of 1 to 10, 1 being the lowest and 10 being the highest.

Following the example from above, all the four advertisers also have a Quality Score associated with their keywords now. Let’s see what their Ad Ranks come out to be. And how ad ranks are going to change the ad positioning.

Advertiser Max Bid Quality Score Ad Rank Ad Position (final)
Aman $2 9 18 3
Bob $3 5 15 4
Caity $4 7 28 1
Disha $5 4 20 2

From the two tables, we can very easily see a significant change in the ad position. Quality Score did play a crucial role. Disha, who bid the highest ($5) couldn’t secure the top position. Aman, who bid the lowest ($2) could still secure a better position than Bob who bid higher than him.

How much is an advertiser actually charged? What is the Actual Cost-Per-Click?

To calculate the actual CPC of any advertiser on Google AdWords, we can use the following formula.

Actual CPC = [(Ad Rank of the next highest bid)/(Quality Score of advertiser)] + 0.01

We can use this formula to calculate the actual cost-per-click that Google charges all the four advertisers. Caity holds the top position. Her actual CPC is $2.87. Disha holds the second spot. Her actual CPC is $4.51. Aman holds the third spot. His actual CPC is $1.67.

The gist of the blog –

Through auctions in Google AdWords, advertisers aim at getting a better Ad Rank. A good Ad Rank helps in retaining a higher ad position on SERP. Quality Score and Maximum Bid are the two key components of ad rank. In order to spend less and gain a good ad position, the Quality Score has to be optimized. Similarly, increasing the Maximum Bid to rank first is also a bad practice. Instead, you should optimize your Quality Score.

And not to forget, AdWords allows advertisers to adjust their bids not just based on keywords they pick. Advertisers can choose when their keywords should take part in an AdWords auction. Which means that they get to decide when, where and how to show their ads. Bids can be adjusted based on the time of the day, the location of the user, the device that the user is on when using Google search and more.


What is Customer Match in Google AdWords?

Not many advertisers are familiar with the term called Identity-based targeting, neither did I. I managed to understand the term’s theoretical implications, but practical applications were still hard to grasp. However, Google has made it easy for us to get the idea of identity-based targeting right. Google has introduced a new feature called Customer Match in AdWords.

What is Customer Match in Google AdWords?

AdWords Customer Match lets advertisers target their ads to customers based on data about those customers that advertisers share with Google. The data identifier for customers is in the form of email addresses.

Note: Google insists advertisers procure these email addresses from first party procedures.

How does Customer Match work?

Creating a Customer Match list in Google AdWords is very easy. We can break it down into 4 simple steps.

  1. Go to the shared library tab. You can find it on the left side of your AdWords account.
    Customer Match 1
  2. From the options, click on audiences. You will see different remarketing options. Customer emails option is our interest of them all.
    Customer Match 2
  3. Create a new list from create list option below customer emails. And please note that membership duration should depend on your average sales cycle. However, we recommend advertisers to set it longer. This is because we don’t want to miss out on potential leads.
    Customer Match 3
  4. By clicking upload and save list button, you are accepting to the policies of Google. It might take up to 3 hours to complete the process. You can view the progress under audiences tab.

Just by following these easy steps, one can create a Customer Match list on Google AdWords. Also, Google offers this feature on Search, Shopping, YouTube and Gmail campaigns only.

How to set targeting using Customer Match?

After creating the Customer Match list, you have to implement it in various campaigns of your choice to activate the targeting feature. To set targeting, follow the below steps.

  1. In the audiences tab, you can access the targeting options.
    Customer Match 4
  2. From the targeting tab, you can add a campaign or an ad group you want to set the targeting for.
    Customer Match 5
  3. After selecting the campaign, select Interests & remarketing targeting.
    Customer Match 6
  4. And from the drop down, select customer email lists and pick the list of your choice.

Another thing to note is that campaigns may take up to 12 hours to start serving with the updated remarketing list i.e Customer Match list.

Customer Match also helps advertisers discover Similar Audience that could be interested in their offerings.

Customer Match 7

Why to use Customer Match?

Customer Match is a useful advertising tool for many business goals, from increasing brand awareness to driving performance.

  • On YouTube, reach new audiences, by targeting similar audiences to your most valuable customers.
  • On Gmail, reach your customers or a similar audience with personalized ads at the top of their inbox tabs, in addition to your email campaigns.
  • And on the Search Network, and Google Shopping optimize your campaigns by adjusting your bid based on what you know about your customers’ activities.

Furthermore, Customer Match is a perfect implementation of identity-based targeting. Most of all, with a little experience, advertisers can master making the most of it. For any help regarding the same, write to us or visit the AdWords help page.

What is Impression Share in Google AdWords?

Google defines Impression share (IS) as the percentage of impressions an ad receives to the total number of impressions that an ad could get.

The definition is self-explanatory. But how can you calculate your Impression share? What are the types of Impression share? And what are its implications? We will discuss all that in this blog.

Impression share (IS) calculation –

(IS) = Impressions received / Total eligible impressions

Google uses this formula to calculate the Impression share. Google estimated eligible impressions using many factors, including targeting settings, approval statuses, and quality. Impression share data is available for campaigns, ad groups, product groups (for shopping campaigns), and keywords. Usually this data has a time lag of 2 to 3 days and will only be shown for campaigns/ad groups/keywords with significant impressions.

Types of Impression Share (IS) in AdWords –

  • Search IS –  (IS) only for impressions generated through Search Network.
  • Display IS –  (IS) only for impressions generated through Display Network.
  • Search Lost IS (budget) – The percentage of impressions lost out on Search Network due to insufficient budget.
  • Display Lost IS (budget) – The percentage of impressions lost out on Display Network due to insufficient budget.
  • Search Lost IS (rank) – The percentage of impressions lost out on Search Network due to low ad rank.
  • Display Lost IS (rank) – The percentage of impressions lost out on Display Network due to low ad rank.
  • Search Exact Match IS – (IS) from Search Network for search queries that matched keywords exactly.

Note: Lost (IS) due to low budget is available only at the campaign level.

Implications of Impression Share (IS) –

Impression share gives us an idea on how bidding high on a keyword or increasing the budget of a campaign improves the visibility of ads.

If keyword bids are low, the risk of not winning an ad space on the first SERP is inevitable. And this might put you in a position where you are losing impressions, clicks, and conversions. This isn’t good for your business. Using Average Position metric of keywords along with Impression share, you can understand what has gone wrong. The Average Position is good, but the share of impressions is low. Your ads are not getting the kind of exposure that is supposed to be at such high positions.

Likewise, Google doesn’t show your ads if your daily budget gets exhausted. The budget is low, and it gets exhausted by mid-day. You are missing out on impressions for the rest of the day. And for very obvious reasons, it isn’t a good practice. We highly recommend our advertisers to reduce Impression share lost due to budget (preferably zero)

How does Google estimate Impression share?

Google monitors the auctions over the course of a day. Google uses internal information such as quality for you and all other participants in the same ad auctions. Impression share includes all auctions where your ad showed and all auctions where your ad is competitive enough to show. Google estimates IS based on when your ad was competitive in the auction. You don’t need to worry when there are small fluctuations. Changes to your bids, quality, or Google’s ad systems may change the set of auctions in which the system estimates you were competitive. Google could include auctions where your ad could show at twice its current bid. But Google could also exclude auctions where your ad needs a 1,000% bid increase in order to appear.

Impression share estimation for Shopping Ads –

Google calculates IS for Shopping campaigns similarly to text ads. However, Google considers that multiple Shopping ads from the same advertiser can show at the same time. And in order to avoid double counting when multiple ads from the same advertiser are in the same auction, AdWords assigns the impression and the impression opportunity to the highest ranked Shopping ad from that advertiser.

Besides the budget and bid, quality of the ad copy and geotargeting setting also impact the Impression share. Lesser restriction on targeting and improved ad copy quality can boost the share of impressions.

Where to find the Impression share data in AdWords?

You can find the IS data under the Columns button in AdWords. You have to choose “customize columns”, then “competitive metrics”, where all of the different Impression share metrics are available.

Impression Share

Similar Audiences for AdWords Search and Shopping Ads

I have discussed Remarketing Lists for Search Ads, different approaches to using RLSA and the advantages associated with them. This article is a step beyond Remarketing. This article is focused on using Similar Audiences for Google Search and Shopping Ads to approach new customers.

“Similar Audiences looks at data about your existing remarketing audiences and finds new and qualified consumers who have shared interests with that audience. It’s a powerful – but simple way to reach a much larger audience and drive clicks and conversions among new prospects.”

Similar Audiences for Search and Shopping Ads, without a doubt, helps advertisers improve the overall return on their ad spend. Two key advantages of this new feature introduced by Google are –

  1. Improved Audience Targeting –  Similar audiences targeting is a data-driven approach to targeting new potential customers. Earlier, intuition was the tool at advertisers disposal. These potential customers are based on the remarketing lists for search ads.
  2. Better Click Quality – Because similar audiences use remarketing lists as a cue, hence the associated traffic is going to be of a better quality. Advertisers can target those visitors who are very likely to take actions that add value to your business with information and ease.

Note: Audiences in the remarketing lists will not be a part of the similar audiences targeting ensuring that your remarketing audience is not poached by the similar audience.

How do Similar Audiences for Search and Shopping Ads work?

It is quite simple, to be honest. I have explained the process of finding new customers using similar audiences in three steps.

  • AdWords collects data regarding website visitors. AdWords adds these visitors to the remarketing list.
  • Using the remarketing list and the insights from the scrutiny, AdWords records the aggregate search behavior of your visitors.
  • AdWords automatically finds new potential customers whose search behavior matches with your remarketing list.

Let’s look at the example of Drew from our Remarketing List for Search Ads blog. Drew visited an advertiser’s website listing down Studio Apartments. This led to the addition of Drew to the advertiser’s “Studio category” remarketing list. This list has more visitors who were looking for studio apartments. And a while later, Drew’s fiance, Rachel, also searches for a Studio Apartment. She has a similar search behavior as Drew and others in the remarketing list. As a result, AdWords targeted her at similar audiences.

Note: Google doesn’t consider individual search behavior when identifying similar audiences. Instead, Google uses the aggregated search behavior of the remarketing list as a whole.

How does Google qualify Similar Audiences?

Google looks at millions of people before qualifying a user into your similar audience. The system automatically identifies the remarketing list that best matches a user search behavior. Google considers a variety of factors.

  • The number of visitors on the original list
  • How recently these people joined the original list
  • The similarity of these visitor’s search behavior

Note: Google creates a similar audience list only from a remarketing list with at least 1,000 cookies with enough similarity in search behavior to create a corresponding similar audiences.

Google also adjusts your similar audience list as your remarketing list changes. The similar audiences are an advanced approach to building fruitful and profitable advertising campaigns using Google AdWords. Advertisers can also opt out of the similar audiences recommendations following this link.

At AdNabu, we encourage advertisers to consider using Similar Audiences. However, we call for caution. It is best to go read the privacy policies and limitations for added benefits and better understanding.

What is a Good Average Position for your Business?

Google defines Average Position as “A statistic that describes how your ad typically ranks against other ads.”

In other words, Ad Position and Average Position tell where your ads are being displayed on the Google Search Network, Google Display Network or Google partners network.

Google provides 8 ad positions on a SERP. Google numbers these ad positions from 1 to 8, 1 being the top-most position above all the other results. And 8 is the bottom-most position. Your ad can be anywhere between 1 to 8. It can also be on the second SERP where the ad positions are numbered 9 to 16.

How Google determines Ad Position?

Ad Position of an advertiser’s ad is determined by the Ad Rank of that particular ad. Google defines your Ad Rank as the product of your Max CPC Bid and the Quality Score of the keyword that triggered an ad.

Ad Rank = Max CPC * Quality Score

What is Average Position?

It is simply the mean average of ad positions of an ad, keyword, ad group or a campaign. It is also important to note that Average Position statics are available for ads and campaigns as a whole too.

A working example to calculate Average Position –

Let’s say a search query triggered your a hundred times ( hundred impressions) in the last three hours. Google positioned your ad at 1 twelve times, at 2 twenty-three times, at 3 twenty-seven times, at 4 seventeen times and at 5 twenty-one times.

Ad Position No of Impressions
1 12
2 23
3 27
4 17
5 21
Total Impressions = 100

Avg position =(Ad position * No of Impressions) ÷ Impressions

{(1*12) + (2*23) + (3*27) + (4*17) + (5*21)} 100 = 3.12

I have used a very simple formula to calculate the Average Position. We calculated your Average Position to be 3.12  in the last three hours.

Interpreting Average Position –

From the example above, we can see that the Average Position need not necessarily be an absolute figure like 1 or 2. It is mostly a decimal number like 3.12 (from above). What it means is that your ad got the most impression at Ad Position 3.

How to access the Average Position data from your AdWords account?

Average position as a metric is available in almost all views in AdWords including campaigns, ad groups, keywords and ads. One recurring requirement is to observe whether average position changes during the day. You can see that by going to the dimensions tab and segmenting the data by Hour of day.

Average Position

More about Ad Position and Average Position –

Till now we focused majorly on ad position in respect to AdWords Search Network. There is a different approach to evaluating the position of your ad listings. Advertisers very popularly call this “Top vs Others”.

To get the data about your ad placements, you can segment your AdWords tables. In the segments tab in your campaigns, select Top vs Others.

Average Position

Here is what Google says about Top vs Others segmentation. “Apply the “Top vs. Other” segment to your statistics tables to find out where your ad appeared on Google’s search results pages and search partners’ pages.”

To add, Google has also provided guidelines to help interpret the data from Top vs Other segmentation. There are five different terms and each of them is explained for easier understanding.

  • Google search: Top – Your ad was displayed above the organic Google search results.
  • Google search: Other – Any AdWords text ads that don’t appear directly above Google search results are categorized as “Google search: Other.”
  • Search partners: Top – Your ad was displayed above the partner’s organic search results on a search partners’ page.
  • Search partners: Other – Ads that don’t appear directly above partner search results are categorized as “Other.”
  • Google Display Network – Your ad ran on the Google Display Network.

All of this is a lot of information, and Average Position is a topic that gets deeper as you dig. Let us consolidate on what we already discussed in the article.

  • Ad Position is dependent on Ad Rank.
  • Google determines Ad Rank using Max CPC Bid and Quality Score.
  • Average Position is the mean average of impressions per Ad Positions.
  • Data related to Average Position is available in under the dimensions tab.
  • Advertisers also use Top vs Other segmentation to evaluate Average Position.

What is a good Average Position?

We have learned different approaches to segment and collect the data. But what is a good Average Position? A good Average Position for your business is where you are making a positive ROI. It need not necessarily be #1.You can understand this when you look at the Cost-Per-Click and Conversions reports. The lower your CPC, the better. In contrast, higher the conversions, the best.

From customer insights, AdNabu suggests that an Average Position of 2 is idle for a balanced progress. Click-through Rate of positions 1 and 2 aren’t significantly different. But to retain the top position, advertisers might end up bidding higher. Unless the Quality Score of an advertiser is exceptionally better than the competition, pushing to get on the top isn’t cost-effective. Top position is no harm as long as it is not draining the budget. If the Average Position is >= 3, AdNabu suggests improving it.  

Moreover, instances where a higher position with lower conversions and a lower position with higher conversions are not new. In such cases, bringing down the position is a must to maintain a good return on the ad spend.

How to adjust Average Position?

To attain a higher Average Position you can either increase the bid or focus on improving the Quality Score. Likewise, to reduce the position, you can bid lower. Also, there might be a situation where Google Search: Top might be performing lower than Search Partners: Top or vice versa. These are a few optimization techniques to keep your Average Position good.

In conclusion, as we all already know, each keyword, campaign, AdWords account, and advertiser are different in their own way. What works best for one need not produce similar results. This blog post is aimed at equipping advertisers with an in-depth knowledge of Ad Rank, Ad Position, and Average Position. We hope that you have learned something new, and can make better decisions when optimizing your campaigns.

How is the new Enhanced CPC going to change the bidding game?

Enhanced CPC

A little about the basics of CPC and auctions –

To understand enhanced CPC (cost-per-click), let’s recap the concept of cost-per-click and how auctions work.

Cost-per-click is the bidding strategy in Google AdWords. Google, therefore, charges an advertiser only when a user clicks on their ad copy. The link in the ad copy redirects the user to the landing page. Google rules out the cost for displaying the ad in this bidding strategy.

When a user searches for a query on Google search, using the keyword in the query as a cue, Google sends ads of different advertisers to the auction. Also, advertisers define a maximum cost-per-click they are willing to pay for their ad to be shown. This maximum bid is extended up to 30% of its original value to benefit an advertiser to beat the competitors. This is only for advertisers who has opted for enhanced CPC. And this is done only on auctions that Google thinks have a chance of conversion. Based on this max bid and quality score, ad rank is calculated. Google decides which ad is shown on the top using ad rank. And the rest of the ads come next in the order of their ad ranks.

What is the new enhanced CPC?

Google’s new enhanced CPC aims at removing the 30% cap on the maximum CPC bid. Instead, Google adjusts the bid automatically while considering the probability of a click leading to a conversion. Google predicts the conversion probability of that particular advertiser’s account based on the historical data of conversions. Other factors including the match type, keyword-query match, location, language, browser, time of the day, date of the month etc. Your bid might increase or decrease as needed. Google believes that this automated bid adjustment strategy will increase the ROI of AdWords campaigns.

The transition from the old strategy to the new –

Even though Google officially announced the launch of enhanced CPC, the transition from the old strategy to the new might probably be slow. Especially, AdWords, as per popular reports, might do a split testing first.

With regular evaluation, AdWords will validate the improvements from the test. If these results show a significant progress, this new automation might get popular among the AdWords community.

An important note for everyone –

With enhanced CPC being still an experiment, at present, the outcomes are only theoretical. Your spend might, first of all, see a spike in the initial weeks. And probably even out in the months to come. It might also go down drastically initially but burst out later. We furthermore aren’t sure of anything as of now. But at AdNabu, we recommend not switching to E-CPC yet, instead use our in-house Bid Optimizer, at least for your campaigns on AdNabu.

What is a good Click-through Rate in Google AdWords?

Click-through Rate

What is a good click-through rate?. This question frequently comes up during our AdWords Q&A. Before we get into the quest of finding out what a good click-through rate is, we have a few basics to revise.

What is Click-through Rate?

Click-through rate is the ratio of the number of clicks and impressions. It is expressed in percentage. Click-through rate is a key performance indicator of both keywords and ads. To avoid misinterpretation, I have listed down a few important points that highlight the extent and limitations of click-through rate.

  • CTR measures the immediate response, not the overall response- CTR talks about the % of people who clicked on the ad right away to reach the destination page. It doesn’t include people who failed to click on the ad then but visited the website later seeing the ad.
  • CTR doesn’t measure the quality of clicks – A click can merely be out of curiosity which might not lead to a conversion. Hence a high CTR doesn’t necessarily guarantee a good Conversion Rate or a low CTR doesn’t mean a poor Conversion Rate.
  • A good CTR leads to better Quality Score – Good CTR means that an ad is relevant to the searcher’s query. The relevance of an ad is an important parameter when Google assigns Quality Score.

What are the factors that affect Click-through Rate?

Like most of the metrics in internet marketing and AdWords in particular, click-through is also dependent on various other factors. Without a doubt, the ad copy is one of them, but it isn’t the only one.

The advertising network –

Most advertisers, when looking at CTR, overlook the fact that CTR for search, display & partner networks vary significantly. Search network has a higher CTR than display. And partner websites usually have a lower CTR than Google-owned websites.

The device –

Again, device level CTR is a metric that varies heavily. Devices like smartphones and tablets usually see a slightly lower CTR than laptops or desktops. This may, however, vary from campaigns to campaigns.

The industry –

The good click-through rate for each individual industry is different. An eCommerce website can expect a different CTR than a lead-generation website.

Location targeting –

Ads which are locally targeted can have a higher CTR than ones that are targeted globally. We have observed that for countless AdWords accounts localized campaigns have a higher CTR due to customers trusting a store near them.

The ad type –

A text ad might not work well as a persuasive ad, whereas it could be an effective informational ad. Likewise, an image ad might work well for an eCommerce website but not for a lead-generation website. An informational ad might drive a viewer curious and persuade them to click, whereas an acquisitional/promotional ad might not have the same impact.

Ad relevance –

When considering the content of ad you want to advertise using, it is a must to consider the relevance it has to the product/service you are advertising for.

Target audience –

If your ads are placed in front of the wrong audience, CTR will be low. Who do you want to see your ads? This determines CTR too.

Keywords –

The kind of keywords you select, it affects the CTR too. A unique keyword like AdNabu will without a doubt see a good CTR. Because it is not generic, it is focused and it doesn’t have competition. But how would a keyword like Quality Score guide or AdWords optimization software perform? They are generic, a lot of advertisers are using these keywords and CTR is distributed across the advertisers!

Average ad position –

Of all the factors, ad position is the top most factor that affects the CTR. You can’t expect the same performance from an ad that is the bottom of the pile as the one that is at the top.

Having brushed up on the basics, let’s not dive into finding an answer to this complex question:

What is a good click-through rate?

Even though most advertisers look at generalizing CTR and quantifying it, sane ones do understand that this quantification makes very less sense or no sense in most of the cases. Why is it so? Because of the above-listed factors! There are so many considerations, most of which are unique for each advertiser. One could assume all the factors to be at their best, then state a measure of CTR that is good. But that is not the case.

What one can do is take the industry benchmarks listed by popular advertisement management agencies as just a reference. The agencies publish this information which is an average of both low and high performing accounts. They also include the less spending accounts along with the accounts that are burning a lot of cash. You can’t just compare Amazon’s CTR to a local retailer who has just launched their store. There are so many such contradictions.

Yet, with a few meticulous considerations, an advertiser can derive a good click-through rate for their campaigns. One widely accepted and relevant consideration is the average position of ads. Based on the average position, generalization of good CTR makes some sense.

For average ad position between 1 & 2, 20% click-through rate can be considered good. For 2 & 3, 10% and for 3 & 5, 5%.

How to improve click-through rate?

  • By improving ad relevance –  This is one trained and tested ways to improve the click-through rate. Using techniques like Dynamic Keyword Insertion, enhanced ad image quality, catchy ad text and most importantly by choosing the right keywords.
  • By improving ad position – If I have to pick one factor that can surely make a difference the click-through rates, it would be the average ad position. No matter the industry, product/service type, targeting, device and other factors, if the average ad position is good, your click-through rate will be good.

And I can already sense the follow-up question, what is a good average ad position, right? – We have a few elements to investigate before judging an average ad position to be good or bad. One important element here is the spend. How much are you paying to achieve or retain an ad position? We will discuss the ad position in detail in the next blog.