Did you know that Google ads offer a 200% ROI? On every dollar spent by an advertiser, they earn two in return. It is undeniably the best way for businesses to market themselves. However, search marketers usually spend most of their time analyzing SEO algorithms, trying to reverse-engineer the factors that help your website rank organically.
There is not enough focus on paid search, even though PPC is also driven through the Quality score algorithm, similar to SEO. It is used to determine cost per click, ad position, and other factors.
To crack the code, all you have to do is understand the inner workings of the Quality score.
This article will help you understand the impact of Quality score on cost per conversion and cost per click. By the end, you will be able to make sense of how Google calculates the score and get tips on conquering Google ads and improving ROI.
The Impact of Quality score on Ad Position
Quality score is a metric used by Google to grade how relevant ads and keywords within your Google Ads account are. The report is quantified and revealed on a scale of 1, being awful, to 10, being unique.
Why does the quality matter?
Because irrelevant ads don’t appeal to users, and that’s why Google takes extreme care to only show your ads to people who have shown interest in what you’re selling. Instead, they want to showcase clickable ads, as more clicks equal more payments.
The Impact of Quality score On CPC
Quality score is also used to determine the amount you are charged per click. The formula used to calculate cost per click is Ad Rank Of the ad directly below yours/ your Quality score + $0.01.
To put it simply, if your Quality score is high, your CPC discount will be just as high. But, conversely, if your Quality scores are low, you will have to pay more.
What Is Considered To Be A Good Quality score?
Typically, you don’t see 10s across the board when it comes to keyword quality scores. However, there will be a mix of scores; the average score you see nowadays is 5.
Note down this information and apply the correct formula used to calculate CPC.
For example, if your average score is 5/10, you can get a 50% discount on your CPC. On the other hand, with a quality score below average, such as 1/10 on average, your CPC will be increased by 400%.
Quality score: Impact on Cost Per Acquisition
PPC is great for businesses dependent on direct response/lead-generation marketing, such as ecommerce websites. And obviously, they would be more concerned about the cost per acquisition/conversion (CPA) than CPC.
This is because you can get a better profit if you get a high volume of clicks charged at $50 than at $20 per click. Data shows that high-quality scores are directly correlated with low CPAs.
In summary, if you have a below-average Quality score, you will have to pay as much as 64 percent per conversion than the average advertiser. Your CPA will drop 16% per point above the average. Contrarily, each point below the average score of 5/10 will cause the CPA to rise by an average of 16%.
How To Improve Quality scores
It is not evident that Quality score is the key to winning at Google Ads. Instead, the way Google calculates Quality scores is through the Click-Through Rate (CTR). This means that it should be your main focus if you want to improve your score.
The CTR per PPC can vary from a minimum of 0.1% to a maximum of 70%. This is because many CTRs are dependent on commercial intent, which entails that people will click on ads if they find what they are looking to buy.
Thus, you need to focus on commercial intent keywords, including product and services names and authentic brands and products—for example, Philips Air Fryer, software management services, high-speed laptops, etc.
That’s it. That’s your guide to making the most of your Google Ads campaigns.
Remember, it’s easy to get caught up in the technicalities of AdWords. Don’t worry about all that tactical stuff. Just concentrate on keeping your Quality score up, write great ads, get the keywords right, and your AdWords campaign will be successful.