Why the Highest Bid Doesn’t Always Win with Google Ads

First off, what is the Google Ads platform?

Google Ads (previously named Google AdWords) is a paid advertising platform that allows anybody to reach potential customers in pivotal moments along the consumer’s journey. Billions of times per day, people rely on Google to look up answers, discover new places, learn new skills or shop for products and services. In other words, when people want-to-know, want-to-go or want-to-buy, they turn to Google.

With Google Ads, businesses can appear to targeted potential customers at the top of search results and on popular websites. But, how does Google make sure the right ads are presented to the right customer at the right time?

You can’t simply buy your way to the top of Google search results.

Google Ads is an auction based platform. Advertisers determine their maximum bid for placement in paid digital ad placement and auctions run every time a user searches or browses the web. However, the highest bid doesn’t always win.

The winner, and highest positioned ad, is determined by Ad Rank, which is essentially the max bid multiplied by the ad’s Quality Score. The most impactful factors in calculating an ad’s Quality Score are:

• Expected click-through-rate
• Landing page experience
• Ad relevance
• And the use of Ad Extensions

Higher quality ads lead to lower advertising costs.

Relevant search results are vital to Google Ads and advertisers using the platform. Implementing Quality Score in Google auctions prevents advertisers from simply buying their way into search results for irrelevant keywords. Additionally, the higher an advertiser’s Quality Score, the less they have to bid to reach potential customers. Consequently, lower online advertising costs result in greater return on investment.

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