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Higher bid = Lower CTR?

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# 1
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I'm currently running an experiment in my ad group - half my impressions have 2x the CPC bid. (Campaign is search-only, and all other aspects of the campaign are the same between experiment and control - the only change is the CPC bid).

 

What I'm seeing is that the higher-bid experiment is getting a slightly lower position, and a CTR that is only 50% of the lower-bid control. In other words, I'm getting the same number of clicks for both groups, but the higher-bid group is requiring twice as many impressions to generate as many clicks as the lower bid group.

 

See the stats here: https://skitch.com/cmarcus/8m3mn/campaign-management

 

Can anyone explain why bidding 2x as much would produce results that are 1/2 as good?

3 Expert replyverified_user

Hi Cooper,   There are a number of things that could caus...

Top Contributor
# 2
Top Contributor

Hi Cooper,

 

There are a number of things that could cause this. The first thing that comes to mind is there may have been more competition on the SERP's when you set a higher bid. With the lower bid, come of your competitors may have dropped out due to ad scheduling. This is indicated by the lower avgerage position of your ad with the higher bid.

 

That's what experiments are for, to find out what works for you. In this case, I would say the higher bid didn't work out so well.

 

Best of Luck!

 

Pete

 

petebardo -- Deadhead doing AdWords

Hi Cooper,   Look at which keywords are being triggered i...

Top Contributor Alumni
# 3
Top Contributor Alumni

Hi Cooper,

 

Look at which keywords are being triggered in the control and experiment.

 

As you have increased the bid in the experiment, you might find that a different set of keywords are getting more impressions as they are now eligible to enter more auctions (related to - keyword not shown due to adrank)

 

Once you have compared both of these I think you might spot what's going on.

 

Let us know how you go.

What about the actual search networks? Have you looked at...

Badged Google Partner
# 4
Badged Google Partner

What about the actual search networks? Have you looked at your segments per google search and search partners? Search partners data, particularly the top vs. other segment, can be weird... Sometimes the other position for search partners actually produces a higher CTR than the top position. If you are now bidding in the top position, that could be part of the issue...

 

What about device targeting? Competition and keywords are more likely the bigger issues, but device budgets could have an affect. If you are targeting all devices, and now that you have raised the bid, the higher CPC devices now get more expensive clicks, with a limited budget, you could have spent more on more expensive devices, and ran out of budget before the more cost effective devices got enough impressions to generate the same number of clicks.

 

It seems like, regardless of the reason why, the control performance is "better" (from a certain perspective) overall. It looks like you get more impressions with the experiment, but the engagement of the users seeing those impressions is not the same. Pete and Purefuzz have you on the right track here, I would say keywords (match type?), and competition are far greater factors than network or device, but you have to try and take it all in context with analysis like this.

 

What if, just for giggles, you tried the opposite experiment for a similar time frame? What sort of data do you see if you reduced the bid 50%? Thenn you may see some data that let's you know where your control bid falls on the performance scale. Could you do even better with a lower bid?

Tom

Hi Guys,   I'd take the liberty to disagree with every on...

Top Contributor
# 5
Top Contributor

Hi Guys,

 

I'd take the liberty to disagree with every one and have an opinion other than the ones above me.

 

Higher bids can quite often lead to lower Ad Position which, of course, will entail lower CTR. Therefore the real question is why higher bids often lead to lower Ad Position.

 

When your bid is low most of the times you're outranked by competitors, and the ad is left eligible for the 2nd, 3rd etc search results pages only. Since users don't often see pages other than the 1st page, these instances will be cleared from your stats. (Stats only consider instances when the user in fact sees the page your ad is located on!!!) You'll only accrue stats at moments when the advertising scenario allows your ad to show on the 1st page in which favorable cases you may even have high positions (by good luck) so as to accrue a good average by the end of the day.

 

When you raise the bid chances are that your ad will show a great many additional times which are close to borderline cases. Lost impressions are spilling over from the 2nd, 3rd etc pages to the first page but get stuck at low Ad Positions. (Unless the bid increase was astronomical.) And the low ad positions accrued by these impressions will paradoxically deteriorate the high average Ad Position that you formerly enjoyed, thanks to a lower bid.

 

The phenomenon described above is, of course, a paradox that defies logic. Sometimes it happens other times it doesn't happen. If Google considered the so called lost impression stats (2nd, 3rd pages when the user does not see the appropriate page) in the calculation of the average Ad Position you would never come across this phenomenon. It would be non-sense per se. Therefore I'd say the paradox is in fact nothing else but an instance of illusion which is caused by the way Google calculates the avg Ad Position.

 

On the other hand, chances are AdWords don't have an alternative. Considering lost impressions in calculations of the CTR would entail even more issues.

 

Best,

Lakatos

 

 

I agree with the fact that this could be a very pertinent...

Top Contributor
# 6
Top Contributor

I agree with the fact that this could be a very pertinent explanation. The question is how the lost impression share due to rank is calculated. If an ad is eligible only for page 2+ with its lower bids, does this count as a lost impression or not?

Calin Sandici, AdWords Top Contributor | Find me on: Google+ | Twitter | LinkedIn | myBlog
Was my response helpful? If yes, please mark it as the ‘Best Answer.’ Learn how here.

Hi Calin and Others,   >> The question is how the lost im...

[ Edited ]
Top Contributor
# 7
Top Contributor

Hi Calin and Others,

 

>> The question is how the lost impression share due to rank is calculated <<

 

The clue is to know whether or not the user goes and sees the 2nd+ search result page where your ad copy is eligible to show. (Eligibility is, of course, based on the computer simulated auction, as always.) If he does it will be considered a normal impression and factored in metrics. If he doesn't it will be considered a *lost impression* which is not factored in any metrics, let it be the Total ImpressionsCTR% or the Average Ad Position which was discussed above, thanks to the Asker's inspiring query triggering our minds.  

 

However, IS metrics seem to be an exception to the above rule since the basic IS formula is

 

                         Impression Share = Total Impr / (Total Impr + Lost Impr)

 

Total Impr means the total number of impressions that were in fact accrued in your stats.

 

If Lost Impressions were not considered in the calculation of your Impression Share, the metric would always equal to 100%. Similar considerations apply to Lost Impr Share Due to Rank.

 

Cheers,

Lakatos

Alright. That's what I thought as well. So if it's a lost...

Top Contributor
# 8
Top Contributor

Alright. That's what I thought as well. So if it's a lost impression in case it's eligible on page two, and no longer a lost impression when the bids are increased, then the OP should see a decrease in position AND in the Lost Impression (rank) sector, right?

 

I love this thread!

Calin Sandici, AdWords Top Contributor | Find me on: Google+ | Twitter | LinkedIn | myBlog
Was my response helpful? If yes, please mark it as the ‘Best Answer.’ Learn how here.

>> the OP should see a decrease in position << &nbsp; I would...

[ Edited ]
Top Contributor
# 9
Top Contributor

>> the OP should see a decrease in position <<

 

I would rather say that this scenario is not excluded and is sometimes very likely to happen. Unless the bid increase is very high and sky-rockets the ad positions.

 

>> the OP should see a decrease in the Lost Impression (rank) sector <<

 

Yep, that's 100% correct. Accordingly the Impression Share will inevitebly enhance if the bid increase is in excess of a low threshhold. Lost Impression (budget) will not be directly and significantly affected. (Unless again the bid increase is very high and the same budget allows for significantly less clicks that gets delivered early in the day. But this is an indirect effect.)

 

 

So, Cooper, how about an ad group experiment, instead of...

Top Contributor
# 10
Top Contributor

So, Cooper, how about an ad group experiment, instead of a keyword experiment? So you can see lost impressions delta between the two ad groups (control and experiment)?

Calin Sandici, AdWords Top Contributor | Find me on: Google+ | Twitter | LinkedIn | myBlog
Was my response helpful? If yes, please mark it as the ‘Best Answer.’ Learn how here.