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In paid advertising, there are plenty of terms to keep novice marketers on their toes, but not all of them are as important to your business as the two we will explore in this article.
Ad Rank and Ad Position are interlinked values that can confuse many people. When you take the time to understand the difference between Ad Rank and Ad Position you will comprehend the link between them.
Better yet, you’ll be in a better position to make smart decisions about how to grow your business through paid advertising.
Sound good?
Let’s discover more.
Ad Rank is used to determine the ad position, which is where an ad is displayed on Google’s search engine results pages (SERP) relative to the competitors’ ads.
To calculate it, Google considers a number of factors, including:
Here is the formula to help you calculate your Ad Rank:
Ad Rank = MAX CPC Bid x Quality Score x Expected Impact of Extensions
Having a good ranking is definitely a good sign. Here are just a few things that your good Ad rank is telling you:
Whenever a user search triggers your ad, it will compete in an auction, and then Google Ads calculates the rank. This process considers auction-time factors such as ad relevance and expected click-through rate. If your ad gets a better ranking, it is fulfilling more requirements for the top positions.
A high quality score is indicative of a highly-relevant ad that is meeting the needs of users. Google will reward such ads with a lower cost-per-click (CPC) value. Therefore, by maintaining a high ranking position, you can keep your costs to a minimum.
If you have a low ad ranking, there is no need to panic — you can fix it in a number of ways:
Each of these techniques can help you refine your ads so that they are more targeted and more relevant for smaller subsects of your wider audience. This should improve your CTR.
As a last resort, you can also increase your keyword bids to improve ad rank. To discover more about improving your ad rank and optimizing for conversions, check out our blog on Conversion Rate Optimization best practices.
Ad Position relates to your ad’s placement in SERP. This is the list of results a search engine will return in response to specific search terms.
Within SERP, there are two types of search result:
These are the natural listings that search engines return, which are determined by a series of relevant metrics and solid search engine optimization (SEO) practices.
In Google’s SERP, there are up to 8 sponsored search positions.
The Ad rank will influence which position sponsored ads appear. For example, an ad position of ‘1’ will hold the first position in the top area of SERP.
For anyone in paid advertising, seeing your ads in a higher position in search results is a good feeling. But there’s more to be gained than a dose of pride.
When your ads show up on top, there is more chance of getting clicked on. By working on your quality score, you can maintain a good ad position, which ultimately helps to increase your return on investment (ROI).
As the ad position is determined by ad rank, so your ad must meet specific ad rank thresholds in order to be displayed in SERP. Because of this, it’s possible to earn a higher spot even when you’ve been outbid by competitors.
The competition for the top spot can get expensive, which will damage your ROI if you don’t have a smart strategy for growth. Increasing your bids can help move you up, but that’s not a good long-term plan. Ideally, you should be focusing on improving your quality score.
Another point worth knowing is that the #1 average position is not always best.
Google uses the ad rank formula to determine how your ad compares to competitors’ ads. This, in turn, is a factor in your ad position in the search engine results pages.
People who are new to paid advertising may simply try to muscle their way into better positions by throwing money at their campaigns. However, when you realize what the benefits of a good ad rank and ad position are, you’ll discover a smarter method.
There are many factors that Google considers, but the one you should focus on is the quality score. By improving that, your ads will become more engaging, and more relevant to your viewers. After that, click-through rate (CTR) will increase, and your cost-per-click (CPC) will fall.
By taking this approach, you can get a better ad rank, and subsequently benefit from a higher ad position. Best of all, you’ll be doing it for less money, which is great for your overall ROI.
Learn more about improving your quality score now to change the fortune of your campaigns today.
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