Understanding The Ad Rank Forumla

Google’s AdRank formula determines the ad position, or exactly where your ad shows up on the SERP. Adrank can make a huge difference in the success or failure of your campaigns.  The top branded result can get up to 80% of clicks. (Learn more about Google’s recent changes to search engine results pages.)

AdWords Ad Rank Formula

How is the AdRank Formula Calculated?

There are several factors that determine Ad Rank. Google’s AdRank Algorithm assesses the Bid (max CPC) x Quality Score x Anticipated Impact of Extensions.

Let’s break things down even further:

  • Bid (Highest CPC): The maximum amount you’re willing to pay for an AdWords ad click.
  • Quality Score: Estimate of the quality of ads, keywords and landing pages.
  • Extensions: Features within your ad which show extra business information, like a phone number address, or additional webpages.

Google and Bing have similar formula for AdRank. The biggest difference is how Bing calculates quality score. Landing page relevance and quality are a larger part of the equation.

Outbid, Outrank?

Ad rank is more than just outbidding competitors, a higher max CPC does not necessarily mean a better rank. Relevance, quality score, click through rate and extensions weigh heavily in the AdWords Ranking formula.  

Outbid outrank

An ad with a lower bid can easily have a  higher AdWords ad position on a SERP if the keywords are highly relevant and extensions fit well within the searcher’s perceived overall desired outcomes. This is the reason the Evolve Digital Labs team focuses so heavily on keyword research and landing page optimizations to drive the overall user experience, thereby improving AdWords performance.

Cycling Through SERPs

Ad position can fluctuate, that’s because AdRank is recalculated every time your ad could appear on a SERP. With an auction and depending on competition, ad position can move up or down. The top three or four high-ranking ads are eligible for the top positions. There are three ads on the bottom of the page.  The average campaign position can be found under the campaigns tab, look for the average position. You can also click the ad format or keywords tab to check position by keywords.

How to Improve AdRank

There’s no simple fix for improving AdRank, but there are optimizations which can improve quality score, a major factor in rank. The keyword, pun intended, to keep in mind is relevancy and the components which make up the overall quality score and their impact on Ad Rank, from the AdWords AdRank Algorithm.

Consider these elements to enhance the chances of improving Ad Rank.

  • Click Through Rate (CTR) –  Based on historical impressions and clicks within AdWords
  • URL CTR – The clicks and impressions the display URL has historically received
  • Relevance of ad text and keywords – How relevant is the ad copy to a searcher’s query
  • Quality/Relevancy of the landing page – Is the page relevant, easy to navigate
  • Geo Targeting Have your AdWords campaigns had success in the regions targeted
  • Device Targeting How well do the ads perform on different types of devices (mobile/tablet/desktop)

Improving quality score and thus Ad Rank starts with generating content, keywords and assets which keep customer language in mind.  The Evolve Digital Labs free AdWords Grader reviews quality score and keywords, to grade where a PPC campaign stands and the potential for growth. Check it out today and see where your campaigns stack up.

Evolve Digital Labs’ Resources