Last month I read a news brief on Google’s projected numbers for 2011. It was no surprise the damn thing had a green arrow pointing north. With Larry Page at the helm of Planet GOOG (ticker), he has a major undertaking to GOOG shareholders. The idea of making money hasn’t changed. However, one could only question if the plan for making money has changed. Frankly, it’s been the same plan all along.
Google published its projected increase for CPC (cost per click) in 2011 as 5%, the same as last year. When I heard this, I choked on my Americano. There is no way Google’s CPC only increased 5% last year. They must have done one of those weighted means we forgot about in Stats class. Even after digging up a subjective number, we found an 8% increase in CPC that was published by Jefferies & Co.’s analyst, Youssef Squal.
Youssef may not be so quick to overstate but I will. It’s more than that. It’s hard for us to tell because we manage our clients CPC down. When you think about all the advertiser accounts that go unmanaged or that are managed by a majority standard, 8% is the difference between a CPC of $1.00 and $1.08. Come on!
I have to admit: I’ve been dying to write an updated piece about Quality Score (QS) since 2 years ago. The game has changed forever and I’ve spent more time gritting my teeth and cursing at my monitor (logged into Adwords) than ever before. The reason is because we were told quality score was to help ‘reward’ advertisers for constructing highly relevant campaigns and adgroups. But its all different now. Where’s the reward?
When QS was first introduced to advertisers in 2005, it was just a static score used to determine the minimum CPC based on the ad relevancy to its keywords. Over the next five years, Google would add in: CTR, landing page relevancy, account history (a combine average of all CTR’s in an account, and (the best part) “other relevant factors.” I’ve always gotten a big laugh out of “other relevant factors” because as I would dissect QS, I could see there was much more unexplained reasoning for low quality scores.
An Illustration of Traditional Quality Score (Pre-2009-2010)
In August of 2008, Google restructured QS and made it a “real-time” score that would take effect as soon as someone searched on Google. Some of the other differences Google made were: replacment of minimum CPC to “first page minimum bid”, landing page quality, and landing page load time. In expectation of a rough change to quality scores, we were surprised that existing advertisers who had been advertising a while, didn’t really see much change…until 2010. Now we go into the accounts and look around at QS but we’re not in Kansas no mo.