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High Quality Score but Ave CPC Higher than Est CPC

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# 1
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My Quality Scores are OK.  Not brilliant but not terrible either.  I'm currently working on my website and creating pages for each product.  When this is finished I will change the landing pages for my ads to correspond with the specific product.  At the moment all my landing pages are to my Home page.  I'm hoping this will improve my quality score.  In the meantime I'm trying to analyse the current situation.

 

Why are my ave cpc so much higher than est cpc when my quality score is quite good?  The majority of my keywords have a quality score of 7.  Some are higher and a few lower but not many.  My Max cpc is much higher than the est cpc.  I think this could be why my ave cpc is more than est cpc?  Not sure why though if my quality score is quite reasonable?

 

I have tried reducing my budget but then my ads either don't show or my one competitor gets above me.  My competitor's ads are not as targeted as mine.  For example if someone searched "Portacot hire Queenstown" then my ad would say "Portacot Hire Queenstown".  My competitors ad would read "Baby Equipment Hire Queenstown".  This leads me to assume that the ad position between us is based on budget.  However, if this is the case then why is the est cpc not higher to reflect my competitors budget?

 

Can anyone offer advice?  Thanks in advance.

2 Expert replyverified_user

Re: High Quality Score but Ave CPC Higher than Est CPC

Top Contributor
# 2
Top Contributor

Hi Lucy,

 

Welcome to the AdWords Community Smiley Happy

 

Estimated Top Page bids are just estimate, it gives the estimated minimum bid requirement to keep your ads at top position, based on your quality score, landing page experience.But It does NOT give you guarantee that your ads will appear on top page and your actual CPC should be less than Estimated CPC. Actual Cpc is different from the estimated Top Page Bid. It Could be higher or lower than the Estimated CPC.

Because there are some internal & external factors, which impact your Actual CPC:-

  1. Relevancy of the search term with Keywords.
  2. Bid and budget of the keywords and campaigns.
  3. Real time ad rank of your ads. And Remember, Now Ad Extension formats are one the factors on Ad Rank Formula. 
  4. As Quality Score Determine every time when your Keyword matches with the Search term used by user. Thus QS at the time of Bidding.
  5. Competition, Geographical Location, Time, Device, when your ads appear on the SERP.


These are the some factors that determine your actual Cpc.

Thus bidding equal to est top page bid does not give always first positions and bidding higher than est top page bid do not guarantee that you will charged less than est top page bid.

 

Please Follow the below link and video, and learn how Avg CPC is calculated.

https://support.google.com/adwords/answer/6297?hl=en

https://www.youtube.com/watch?v=PjOHTFRaBWA&feature=youtu.be

--Rakesh Kumar, AdWords Top Contributor , Twitter | Linkedin | Community Profile
Did you find any helpful responses or answers to your query ? If yes, please mark it as the ‘Best Answer’

Re: High Quality Score but Ave CPC Higher than Est CPC

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# 3
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Hi Lucy,

 

You have a literally great explanation from @RAKESH Kumar . I would like to add only one thing. 

 

If you do simple a search for 'Portacot hire Queenstown' in Google, you will find that Google highlights phrases like 'rent baby equipment queenstown', 'baby equipment hire', 'baby equipment rental' and so on. 

 

It means Google considers 'baby equipment' to be semantically relevant to 'portacot', the first thing. For the second, 'portacot' has considerably lesser search volume if you compare it to 'baby equipment'. It means the number of people searching for 'portacot' is lesser than that of 'baby equipment'. It further means that a comparatively higher CTR can be expected from 'baby equipment' keywords as more people are searching for it. Google has more historical performance data for this keyword.

 

So, the wise method would be to include 'baby equipment', rental, rent etc terms in your keywords. It will give you better positions and your QS would be more likely to be higher on such terms. Also, make sure to optimize your landing pages for these terms as well.

 

My two cents.

 

All the best!

 

Thanks
Ratan Jha

 

 


About Me: Community Profile | Ratan Jha INC. | Splashsys Webtech
If this or any other post solved your question, do not hesitate to accept it as the solution.

Re: High Quality Score but Ave CPC Higher than Est CPC

[ Edited ]
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# 4
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Thank you Rakesh and Ratan for your replies.

 

I'm still a confused. Here's another example. If I use the Ad Preview and Diagnosis and search +baby +hire +queenstown there is only my ad and one other ad. Therefore the competition is not high for this keyword. My quality score is 9/10. I also have another keyword +baby +hire. However, whilst this keyword may have a higher search volume world wide this keyword is only triggered when people search locally. This keyword has a quality score of 6/10.

 

Within the last 7 days the keyword +baby +hire +queenstown had an ave CPC of $4.79. Yesterday the ave CPC was $2.44. When ever I use the Preview tool there is only myself and one other ad that comes up. I have tried different locations and devices.

 

I would be surprised if the one other ad showing is changing their bid. Their ads are not very good and I'm guessing they wouldn't be tweaking their bids.

 

I have just checked the ad extensions status for the last 7 days which is quite interesting.  Performance of sitelinks extensions for this ad group are as follows:

 

Home Page: CTR 11.11% - ave CPC $2.73

Equipment & Booking: CTR 20.83% - CPC $4.45

Blog: ctr 12% - CPC $2.73

Contact: CTR 19.23% - CPC $4.45

 

In the above example the higher the CTR the higher the CPC.  I have checked various different time periods. In all cases where the CTR is the same or very similar to each sitelink then the CPC is the same or very similar. In all cases the higher the CTR the high the CPC.

 

This leads me to believe that the landing page of these extensions is very relevant.  My Equipment and Bookings page is a cloud based booking system.  I have 5 categories.  The first category is Strollers and thus the landing page. I'm therefore thinking that if the search term did not include the word stroller and you then click on Equipment and Bookings' site extension then my quality score is less and thus a high CPC?

 

Should I therefore remove Equipment and Bookings & Contact from my Sitelink extensions as these landing pages probably don't link directly to the keyword search?

 

I could eventually replace the Equipment and Bookings' Sitelink to the specific product pages I am currently working on. These pages will also have a 'Contact' link anyway.  However, it was my intention to have the landing page for the actual ad itself to be the product page.  Should I keep the ad's landing page as the Home Page and the Sitelink be the product page or vice versa.  Or double up the ad landing page and Sitelink as both being the product page?  Then what do I do for generic searches such as 'baby equipment hire' that do not refer to specific products?

 

The Call Extension CPC seems to correspond with the the CTR of the Sitelinks.  Ie the CPC matches the CTR % of the Sitelinks.  Again, the higher the CTR the higher the CPC?

 

The landing page I set up with each ad is the Home page.  Is this landing page overridden with sitelinks?

 

I hope I have made sense!

 

Thanks

 

 

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Accepted by topic author Lucy W
September 2015

Re: High Quality Score but Ave CPC Higher than Est CPC

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# 5
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Hi Lucy,

With respect to the ad preview and Diagnosis tool. It is worth noting that this tool should be used for diagnostic & preview purposes only and not as an indicator of the actual SERP. There will be discrepancies between the 2 and these will lead to erroneous assumptions, such as the level of competition your keyword is experiencing.

A better indication of competition would be the Auction insights report for the ad group in question.

As to the sitelinks problem you are referring to. This connection is actually a misunderstanding, and can be explained in a variety of ways. The simplest is just based on position. Consider that Adwords shows 2 of your sitelinks when in position 2 and 4 in position 1. Now perhaps the 2 with the high CTR's are mainly present in pos 1 (as indicated by their higher CTR) this would also lead to a higher CPC as pos 1 is more expensive than pos 2. The opposite then applies for the other 2 which mostly appear in pos 2, these will have lower CTR's as less traffic clicks on pos 2 when compared to pos 1 and they will be cheaper.

There are 3 sets of numbers that you need to compare (in conjunction with each other) in order to look at ad extension data. These 3 are the following:
1) Top line data (as you are looking at above)
2) This extension vs other (segmented data looking at the actual clicks on the sitelink)
3) Click type (segment data looking at how many of the ads clicks are on sitelinks)

By just using the top line data you are allowing too many variables to influence your conclusions as that data actually has little to do with sitelinks as an independent entity.

If someone clicks a sitelink then they go to that sitelinks destination URL, they will not go to your ads destination URL.

Sitelinks do not effect QS post Auction. So clicking on a sitelink will not suddenly increase the price for that ad. The price is already set before the user even sees the ad.

QS is calculated for each and every auction, and thus will vary (sometimes drastically) for the same keyword ad combination. What you also need to remember is that the QS that you see in your account can be very misleading as that is the QS of that keyword for exact match only. Broad and phrase matches to that keyword can have vastly different QS which can effect the over all CPC of that keyword. I would suggest looking at the search query report to determine how much of your traffic is closely related to your keywords.

There are a lot of topics to go over with relation to this question but I hope I have shed some light on some of it. Let me know if you have any questions.

Re: High Quality Score but Ave CPC Higher than Est CPC

Top Contributor
# 6
Top Contributor

Hi Lucy,

 

I spent sometime doing a search for 'Portacot hire Queenstown' in Queenstown location and could see a total of 6 ads on the very first page. Hence, the competition is not between only two of you, there are a few others as well Smiley Happy

 

Let me now come to your questions. 

 

Should I exclude those two sitelinks as they have higher CTR and Higher CPC ? 

 

Let's first understand the impressions and clicks metric for extensions. The number of clicks you see for individual sitelink is not the number of time that particular sitelink was clicked, the clicks column counts clicks both on your sitelinks and on your ad when your sitelinks appeared with it. (Source). 

 

Now, it becomes easy to understand that the CTR you see for each sitelink is not absolute to it only. This metric takes the combination of clicks made both on ad and on sitelink into account. To check the exact number of click on a sitelink, you can segment data by Click Type. It will give you clear picture of your sitelink's performance. If you see majority of clicks on your ad headline, it means you are getting this increased click because your ads become more candid and enhanced on SERPs when they appear with sitelink. It sometimes attract unnecessary clicks as well, that's my personal experience for top position ad.

 

Next, whether you should exclude them or not, I would advise you analyze the performance as discussed and only then come up with a decision. If you think your sitelink is merely creating deviation and is not much targeted to conversions, it's better not to use. Remember, you should treat all your sitelinks as individual landing pages. If your sitelink pages are not optimized for conversions, you are simply showing your visitors a way to go away from your main offerings. 

 

Now let me come to the cost thing. My personal experience says that if I get obsessed with top rank of my ad, I am more likely to pay more unnecessarily. Please bear in mind that ranking at the top does not mean it will fetch maximum number of conversions (I recently did an article on it), but it ensures one thing and that is - I will be paying more than my competitors. So, I would advise you to check your ads performance at different ranks ranging from 2 to 4. After a few weeks, you will be able to find your most profitable ad position.It will help you to keep the cost at the minimum possible amount. 

 

Also, as you say - higher the CTR the higher the CPC. It's not necessarily true in general, but when you compete for nothing but for top ad position, it may seem true.

 

Hope it helps.

 

Thanks
Ratan Jha

 


About Me: Community Profile | Ratan Jha INC. | Splashsys Webtech
If this or any other post solved your question, do not hesitate to accept it as the solution.

Re: High Quality Score but Ave CPC Higher than Est CPC

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# 7
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Thank you everyone!  I'm slowing beginning to get it.  I can understand that my CPC will be more when my ad is in the top spot and less if the same ad is lower for another auction.  It also makes sense that my CTR would be higher for the top ad slot and hence higher CPC. I even get that if someone clicks a Sitelink when the add is in the top slop then it would also cost more.

 

I have recently found out how to adjust bid for individual keywords.  It wasn't my intention to be in the top slot. Just above my one local competitor.  Now I know how to adjust each keyword bid I can be more precise.

 

What I still can't work out is how to see how many competitors I'm up against for my keywords at any one time? I didn't say there was only one competitor for 'portacot hire queenstown'.  I said there was only one competitor for '+baby +hire +queenstown'.  If the Preview Diagnosis tool can not be relied upon to assess competition then where do I find the Auction Insights?  I've gone to the Ad Group that '+baby +hire +queenstown' is in.  Which tabs do I need to click after this? Or does it matter? Should I just gradually decrease my bid for this keyword and keep checking with the preview tool that I'm above my local competitor?

 

A few days ago I adjusted the bid for keyword '+car +seat +rental +queenstown'.  I realised I was paying too much as I was competing against car hire ads which are very competitive. I reduced my bid so I was about 2 or 3 down from the top but still above my competitor.

 

I would like to tweak the bid for '+baby +hire +queenstown' but I can't see any other competitor on the preview diagnosis.  As I said above it probably doesn't matter if I'm not interested in coming above these 'hidden' competitors?  If I've bid between $2.44 and $4.79 for this one keyword then in what increments should I decrease it?  Also, if I then check the preview tool will my adjustment take affect immediately?

 

I have checked Google Analytics for this keyword for the last 7 days when my ave CPC was $4.79.  The search queries by the customers were either 'baby hire queenstown' or 'queenstown baby hire'.  So my keyword was a good match. Yesterday my ave CPC for this keyword was $2.44.  Again the search query was an exact match.  I can only conclude that my local competitor has either reduced their bid or there were other competitors earlier in the week or there are competitors I cannot see?

 

I think I went off subject a bit with Sitelinks.  I can see it's relevant but it's hard to digest everything all at once :-)  I'll review all your great information on Sitelinks later.

 

I really do appreciate all your help everyone!

Marked as Best Answer.
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Accepted by topic author Lucy W
September 2015

Re: High Quality Score but Ave CPC Higher than Est CPC

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# 8
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HI Lucy,

To view the Auction insights report, It is under the details tab (same place you find the search query report).

Learn more here:
https://support.google.com/adwords/answer/2579754?hl=en

With regards to bidding above a certain competitor there is actually a new flexible bid strategy that allows you to do this automatically. The strategy is called target outranking share. This may be beneficial in terms of time saving. Just ensure that you watch it for awhile to make sure that you are comfortable with the way it is operating within your account.

Learn more here:
https://support.google.com/adwords/answer/2979071

Good Luck

Re: High Quality Score but Ave CPC Higher than Est CPC

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# 9
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Hi Clynton,

Thanks for the heads up on where to find the Auction Insights. Unfortunately I don't seem to have enough activity? This message comes up "There has not been enough activity for us to generate an Auction insights report. Please select a different range or alter your selection. "

How much activity does there need to be for the Auction Insights to work?

I will look into the new flexible bid strategy. That looks like it will work for me.

So the only thing I'd like to get sorted now is the Auction Insight if that's possible?

Thank you!
Marked as Best Answer.
Solution
Accepted by topic author Lucy W
September 2015

Re: High Quality Score but Ave CPC Higher than Est CPC

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# 10
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It is an unknown variable. The system needs some data to work with. I am guessing this is a new account? If that is so you will have to give it a few days. If it has been active for awhile then you will have to increase the date range that you are looking at.

In most circumstances a couple of days data is enough, unless you have a low volume account. So the inverse is also true, if you have a high volume account then you can look at a single days data.

The required data does fluctuate and is not a simple exercise of saying you need 10 000 impressions in order to show that data.

Good Luck