This past Tuesday Google announced a big change in the way AdWords ads are ranked in the search results. Before this update, ads were ranked according to a basic Ad Rank formula that I explained last week in How to Improve Your Google AdWords Quality Score (in just 24 hours). The Ad Rank formula was:
Ad Rank = (Your bid) x (Your Quality Score)
So to get your ads to rank higher you used to have just two options: increase your bid or improve your quality score. But as of Tuesday, we now have a third option…
The New Ad Rank Formula
As you may or may not know, Google’s business is dependent on their search advertising revenue. Therefore, it’s in Google’s best interest to give advertisers the best tools and ad formats to entice searchers to click on all those ads. And Google is relentless about testing new ad formats. Every couple of months a new shiny ad is released to a select number of beta testers and if the tests show an increase in ad clicks, then Google rolls it out to all advertisers to maximize their revenues.
Well not too long ago Google released ad extensions, which as the name implies, are additional features that you can add to your ads. For example, you can use the Call Extension to include your phone number in your ad. Or, if you want to add your store address next to your ad in the search results, then you can use the Location Extension. My favorite, which I wrote about in Google AdWords Enhanced Campaign Settings Checklist, is the SiteLinks Extension. SiteLinks are additional links that display underneath your ads to give you even more opportunities to attract your prospects (see below).
As you can image, ad extensions catch the attention of prospects and lead to more clicks on your ads. In turn, that drives more leads and sales for your business, and more money into Google’s bank account.
With all that background it should be fairly obvious what Google is now going to use in their ad ranking formula. If you wanted to maximize Google’s ad revenues, wouldn’t you give preference to advertisers that used ad extensions? I sure would, and that’s exactly what Google announced on Tuesday.
So the new Ad Rank formula is:
Ad Rank = (Your bid) x (Your Quality Score) x (Expected Impact of Your Ad Extensions)
Start Using Ad Extensions (Or Else…)
It’s obviously in every advertisers best interest to start using ad extensions. If you don’t, then you risk losing your current ad position. Not all ad extensions will make sense for your business, but I can’t think of any reason to not set up SiteLinks.
So if you haven’t already, go log in to your AdWords account, click on the “Ad Extensions” tab, and then use the “View” drop-down menu to select the ad extension to add.