If you liked the recent posts about Quality Score, you’ll love the recently launched Search Ads Quality Getting Started Guide.

The guide offers information on how Quality Score affects your ranking and how much you pay, tips on how to improve your ad quality, and addresses some of your most common questions. It should serve as a resource to help improve the efficiency and profitability of your search advertising on Google.

Whether you've been advertising with AdWords for years, or you just created your first campaign, we believe that the Getting Started Guide will be a useful resource for you to learn more about a topic that is at the core of advertising on AdWords. Use it to learn, refresh, or review the foundations of Quality Score. You may even want to share it with clients to help them understand how their ads are shown on Google.com. Check it out today!


Posted by Jeremy Wood, Product Specialist Team

For today's APAC agency post we have a note from our Chief Economist at Google, Hal Varian. Hal and his team spend most of their time studying the AdWords auction and finding ways to make it more efficient. Today he'd like to share some research that he and his team has done on conversion rates by ad position:

Advertisers often ask us how conversion rates vary with position. Everyone is aware that higher positions tend to get more clicks and therefore more conversions in total. The question of interest is how does the conversion rate (conversions/clicks) vary with position?

This is a tricky question for several reasons. Since Google ranks ads by bid times ad quality, ads in higher positions tend to have higher quality and higher quality ads tend to have higher conversion rates. Thus you may see a correlation between auction position and conversion rates just due to this ad quality effect. However, the real question is how the conversion rate for the same ad would change if it were displayed in a different position.

Another difficulty is that the average position number reported by Google is that it is an average over all auctions in which you participate. If you increase your bid, it is quite possible to see your average position move lower on the page! The reason is that when you increase your bid, your ad will appear in new auctions, and it will tend to come in at the bottom of those new auctions. This effect can be large enough to push your overall average position down. See this FAQ for more on this issue.

We have used a statistical model to account for these effects and found that, on average, there is very little variation in conversion rates by position for the same ad. For example, for pages where 11 ads are shown the conversion rate varies by less than 5% across positions. In other words, an ad that had a 1.0% conversion rate in the best position, would have about a 0.95% conversion rate in the worst position, on average. Ads above the search results have a conversion rate within ±2% of right-hand side positions.

The bottom line: conversion rates don't vary much by position.

Posted by Jeremy Wood, Product Specialist Team
This is a partial cross post from the Inside AdWords Blog